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NPS: What It Is, Why You Should Care, and How to Improve Yours

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NPS: What It Is, Why You Should Care, and How to Improve Yours

NPS-hero-image-2Ever heard of Net Promoter® Score? Even if you haven’t, chances are you’ve answered a Net Promoter Score question without knowing it.

Have you ever answered a question that asks:

“How likely is it that you would recommend this product/service/company/jetpack to a friend or colleague?”

That’s the Net Promoter Score (NPS) question. And while it may seem simple, it’s actually a pretty powerful tool.

It’s designed to assess customer loyalty, but it’s widely used for consumer surveys, employee engagement surveys, customer satisfaction, and more.

One of the reasons its use is so widespread? It’s a remarkably effective way to quickly gauge customer loyalty. That’s why so many companies use it—it can really help measure the health of your customer base.

Why’s NPS so important?

There’s a ton of value to knowing your NPS.

  • It’s benchmarkable — Once you set a baseline NPS, you can begin tracking your progress over time and see how the improvements you put in place affect it.
  • You can react to it quickly — When employees or customers give you a low rating you know exactly who to improve relations with first. When you get high marks, you know where your next best opportunities will be.
  • It’s easy to understand — Need to quickly explain how well your brand loyalty is doing? A Net Promoter Score is really easy for most people to understand. It’s straightforward and not at all complex, so it’s really valuable as a data point.

Find Out What’s Driving Your NPS

Use our template built specifically for software companies uncover what’s behind your Net Promoter Score.

Try it now

So how does it work?

Whenever anyone answers an NPS question, they’re lumped into one of 3 groups: promoters, passives, and detractors.

  • Promoters: Respondents who answer 9 or 10.
  • Passives: Respondents who answer 7 or 8.
  • Detractors: Respondents who answer less than 7.

You can calculate your NPS by simply subtracting the percentage of detractors from the percentage of promoters.

So what’s a good NPS? Unfortunately, NPS scores aren’t one size fits all. The average NPS can vary a lot by industry, geographical area, or even company size. But SurveyMonkey Benchmarks has a host of comparisons you can use to see where you stand.

What makes my NPS what it is?

NPS is just an indicator of customer loyalty overall—it doesn’t tell you what factors are actually making your respondents detractors, passives, or promoters. However, SurveyMonkey has done extensive research within certain industries to find out what factors affect NPS the most.

For instance, research by SurveyMonkey’s survey scientists found 4 factors that account for the majority of change in the NPS of software companies.

Using the findings from that study, the team created a survey template that specifically targets the factors that contribute to NPS in software companies. By understanding what actually drives their NPS, software companies can spot areas for improvement or build on their strengths.

After all, finding your NPS is a great place to start—but finding out what’s behind it takes you to the next level.

Questions for Jillesa? Let her know in the Comments section below!

NPS®, Net Promoter® & Net Promoter® Score are registered trademarks of Satmetrix Systems, Inc., Bain & Company and Fred Reichheld.

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