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06 MAY 2015

NPS and what's next? Three questions you should ask yourself

NPS

So you’ve done the Net Promoter Score (NPS) everyone is talking about. You’ve got your score and know how many of your customers are Promoters or Detractors. Great! What’s next? You’re probably wondering what the number actually means and how to use it. Start by asking yourself these three questions.

Is my NPS too low?

A Net Promoter Score equal or higher than 0 is a good result. You should be concerned if the score is negative, which happens when the number of Detractors is higher than the number of Promoters. If that’s the case it will be extremely difficult for your business to grow without a serious improvement plan. 

Net Promoter Score results above 50 are generally regarded as exceptionally high and mean your business has a serious word-of-mouth marketing growth potential.

You should draw lessons from the results of individual groups of customers. It’s actually possible that two different brands evoking completely opposite emotions, can come up with the same NPS result. E.g. and NPS which equals 20 can mean that the company has 0% of Detractors and 20% of Promoters, but it can also be true for a company that polarizes its clients way more and has a Promoters to Detractors ratio of 60:20. Which one are you?

If you want to make a profound study of your NPS results take a look at the sources and read The Ultimate Question: Driving Good Profits and True Growth.

What is the right NPS result for my brand?

Instead of meditating over the height of your result try placing it in the right context and find benchmarks among the competition. An NPS result of 20 might seem low to you, but it’s possible that, when compared with the competition it turns out to be very good. Do your research or check the industry and competition benchmark. E.g. Apple’s NPS equals 66, Samsung has a result of 54 and HP of 46 (customergauge.com). The score might be different depending on the country. The result is also influenced by the product category your brand belongs to. Generic products usually have a lower level of customer recommendations, while more complicated products with higher purchase risk typically have a higher recommendation rate.

With so many Promoters why are my sales results still low?

You know the score and the division of your customers. Perhaps you’re happy with the high amount of Promoters. Make sure you check where your sales actually happen and which group generates the highest income. You might be surprised!

If your key sales involve Promoters and their amount is linked with the amount of your sales, the situation is under control. But what should you do if, despite a high NPS result and numerous Promoters, their loyalty does not translate to sales and they don’t generate the desired income? Perhaps the Promoters are only using your cheapest and most basic offer and that’s why they’re so pleased. Your Detractors, in turn, have chosen more pricey solutions and are not satisfied with the price to quality ratio. If most of your sales don’t happen in the Promoters group :

  • search for inspiration in the positive experience of your most loyal customers and implement it to the rest of your offer
  • focus on getting your Promoters to try out your other solutions
  • think your price policy over

It’s good to know your NPS result, but it only pays if you use it to implement actions that help your business grow.

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