How do you use NPS to gauge customer satisfaction?

1 What is NPS?

NPS is a survey question that asks your customers to rate on a scale of 0 to 10 how likely they are to recommend your product or service to a friend or colleague. Based on their response, you can classify them into three categories: promoters, passives, and detractors. Promoters are those who give a 9 or 10, meaning they are very satisfied and loyal. Passives are those who give a 7 or 8, meaning they are somewhat satisfied but not enthusiastic. Detractors are those who give a 6 or lower, meaning they are dissatisfied and likely to switch to a competitor. To calculate your NPS, you simply subtract the percentage of detractors from the percentage of promoters.

2 Why use NPS?

NPS is a useful tool for measuring customer satisfaction because it is easy to implement, understand, and benchmark. You can use NPS to track your performance over time, compare yourself with your competitors, and identify your strengths and weaknesses. NPS also correlates with customer retention, loyalty, and word-of-mouth, which are key drivers of growth and profitability for any business. By using NPS, you can get a clear picture of how your customers feel about your product or service and what you can do to improve it.

4 How to analyze NPS data?

Once you have collected your NPS data, you need to analyze it to extract meaningful information and insights. You can use various tools and techniques to do this, such as dashboards, charts, reports, segmentation, and text analysis. The main goal is to understand how your NPS varies across different customer groups, channels, products, features, or time periods. You should also look for patterns, trends, and outliers that can reveal opportunities or threats for your business. For example, you can see which customer segments are more or less satisfied, which channels or products generate more or less referrals, or which features or benefits are more or less valued by your customers.

5 How to act on NPS data?

The final step is to act on your NPS data to improve your customer satisfaction and loyalty. You should use your NPS data to inform your decisions and actions, such as product development, marketing, sales, service, or retention. You should also communicate your NPS results and feedback to your customers, employees, and stakeholders, and show them how you are using them to enhance your customer experience. For example, you can thank your promoters for their support, apologize to your detractors for their dissatisfaction, and ask your passives for their suggestions. You can also reward your promoters with incentives, address your detractors' issues or complaints, and engage your passives with more value propositions.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?