Net Promoter Score Calculation to Find NPS Score of an Organization
The Net Promoter Score (NPS) is a tool to measure client satisfaction for a company. This is measured with one single question based on the quality and product of the company. The NPS helps to identify the growth potential of your company or product. NPS was developed by consultant Fred Reichheld of Bain & Company in collaboration with the company Satmetrix.
Make use of this tutorial to learn how to calculate NPS Score.
The NPS assesses how customers recommend a certain company, product or service to his friends, relatives or colleagues. The client or the customer is requested to answer the below question with the rating between 0 (not at all likely) to 10 (extremely likely).
How likely are you to recommend company/brand/product X to a friend/colleague/relative?
The customers or clients or people answering the question are distinguished into three categories based on the rating they provide for the question:
→ Promoters: who rate 9 or 10
→ Passives: who rate 7 or 8
→ Detractors: who rate 0 to 6
The Net Promoter Score (NPS) is calculated as the difference between the percentage of Promoters and Detractors and is expressed as an absolute number between -100 and +100. It is not expressed as percentage.
Net Promoter Score (NPS) = % Promoters - % Detractors
Net Promoter Score Example and Calculation:
Consider the below example. The NPS value of an organization is given as Promoters: 35%, Passives: 45% and Detractors: 20%. The NPS will be calculated as below.
Net Promoter Score (NPS) = 35 % - 20 % = +15. (Expressed as a number and not as percentage).
A positive NPS (>0) is considered good.
NPS is used in many large companies as a customer feedback tool. NPS indicates growth potential and customer loyalty for a company or product. You can compare your NPS for different areas or products versus the industry average, called the average NPS, if available.
NPS of an average company stays less than +10, whereas the highest performing organizations are situated between +50 and +80. However the NPS score varies between industries and between cultures and societies.