Net Promoter Score & Model

Net Promoter Score (NPS®) is the most popular and proven metric for measuring and acting on customer loyalty data.



How It Works

The Net Promoter methodology is so simple you can explain it with a drawing on a napkin.


Why NPS?

The Net Promoter model is an approach in which you use your Net Promoter score to drive improvements.

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Higher Margins

Promoters are usually less price-sensitive than other customers because they believe they’re getting good value overall from your company. The opposite is true for Detractors, who are more price-sensitive.

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Higher Annual Spend

Promoters buy more, more often, than Detractors do. They tend to consolidate more category purchases with their favorite supplier. Promoters’ interest in new product offerings and brand extensions also exceeds that of Detractors or Passives.

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Greater Cost Efficiencies

Detractors complain more frequently and consume more service resources. In contrast, Promoters reduce customer acquisition costs by staying longer and helping to generate referrals.

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Higher Retention Rate

Detractors generally defect at higher rates than Promoters, which means that they have shorter and less profitable relationships with your company. Rescue those Detractors—turn them into Promoters—and experience higher margins.

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Greater Word of Mouth

What proportion of new customers selected your firm because of reputation or referral? The lifetime value of those new customers, including any savings in sales or marketing expense, comes from Promoters. If you’re using the Net Promoter model, you’ll attribute 80 to 90% of referrals to Promoters. On the other hand, Detractors are responsible for 80 to 90% of negative word of mouth, so you can attribute the cost of this drag on growth to them.

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The Ultimate Test

The ultimate test for any customer-relationship metric is whether it helps your organization tune its growth engine to operate at peak efficiency.

  • Does it help your employees clarify and simplify the job of delighting customers?
  • Does it help you identify and engage your best customers?
  • Does it allow you to compare your performance—to yourself and to industry leaders—from week to week and month to month?

Net Promoter—and its notion of Promoters, Passives, and Detractors—does all this, and will help your company realize the benefits you may have heard about.

 

Unlock Business Growth

Apply the power of Net Promoter to your customer experience management work.


A focus on Net Promoter is your surest route to a thriving business. Learn more in this ebook.
Learn the milestones on your journey toward an effective Net Promoter program.
Find out how improvements in your Net Promoter Score affect your organization’s profit and growth.

 

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