The Net Promotor Score (NPS)
The net promotor score is a number between minus 100% and 100%. To compute a Net Promoter score you need to subtract the percentage of Detractors from the percentage of Promoters. You obtain a Net Promoter Score by asking customers a single (loyalty) question on a 0 to 10 rating scale:
How likely is it that you would recommend to a friend or colleague?
Based on their responses, customers can be categorized into one of three groups:
- Promoters (9-10 rating),
- Passives (7-8 rating), and
- Detractors (0-6 rating).
The percentage of Detractors is then subtracted from the percentage of Promoters to obtain a Net Promoter score. see figure 7.
Figure7. NPS calculation.
Tracking net promoters (the percentage of customers who are promoters of a brand or company minus the percentage who are detractors) offers organizations a powerful way to measure and manage customer loyalty. Firms with the highest net-promoter scores consistently garner the lion's share of industry growth.
Example (1):
- Detractors : 20%
- Passives : 30%
- Promotors : 50%
- 50-20 = 30
The net promotor score : 30
Example (2):
- Detractors : 30%
- Passives : 50%
- Promotors : 20%
- 20-30 = -10
The net promotor score: -10 (minus 10)
The score does not follow a 0-100 scale but a -100% to +1-00% scale