What is NPS (Net Promoter Score)?

NPS, or Net Promoter Score, is a widely recognized metric used to gauge customer loyalty and satisfaction. It measures the likelihood of customers recommending a company's products or services to others, thus indicating the overall health of customer relationships.

When to use NPS?

NPS should be utilized when a business seeks to understand customer loyalty and identify areas for improvement. It is particularly useful after major changes in service or product offerings, or periodically to track customer sentiment over time.

When not to use NPS?

NPS may not be suitable for all types of businesses or industries, especially those with small customer bases where individual responses can skew results. Additionally, it should not be used in isolation; it works best when combined with other metrics and qualitative feedback for a comprehensive view.

What is the anatomy of NPS?

The anatomy of NPS involves a simple survey question asking customers to rate their likelihood to recommend the company on a scale from 0 to 10. Based on their responses, customers are categorized as Promoters, Passives, or Detractors, which helps in calculating the overall NPS score.