The Net Promoter Score helps businesses measure customer loyalty. It’s an easy way to understand your customers and measure how satisfied they are with your products or services.

Ask one question: “How likely are you to recommend our company to a friend or colleague?” Rate from 0 to 10. – you can learn about your customers and make better business decisions to improve your profits.

This guide will teach you the basics of NPS. It will show you how to calculate your score, understand the results, and use them to improve customer relationships.

What is the Net Promoter Score (NPS)?

The Net Promoter Score (NPS) is a popular way to measure customer loyalty and satisfaction. It asks customers if they would recommend our company/product/service to others.

People usually rate on a scale of 0 to 10. Those who rate 9 or 10 are called “Promoters,” 7 or 8 are “Passives,” and 0 to 6 are “Detractors.”

The formula for NPS is:

Net Promoter Score = (Number of Promoter Scores/Total Number of Respondents) – (Number of Detractor Scores/Total Number of Respondents)

That gives a score that can range from -100 to +100. A positive NPS indicates a higher likelihood of customer recommendations, while a negative NPS suggests room for improvement.

NPS provides businesses with a straightforward and effective way to gauge customer satisfaction and identify areas for growth. It has become a valuable tool for companies across various industries, offering insights to inform strategic decisions and improve overall customer experience.

NPS score breakdowns:

0 – 6: Detractors – The unhappy customers

This group includes customers who did not have a satisfactory experience and are unlikely to buy again.

Detractors can cast a shadow on your business, influencing potential customers. It’s crucial to delve into their feedback and understand the root causes of their dissatisfaction.

Addressing these pain points is a chance to regain their trust and a valuable source of insights. After implementing changes, reassess the NPS in 3–6 months to gauge the effectiveness of your efforts.

7 – 8: Passives – The “Take it or leave it” customers

Passives are those customers who didn’t encounter major issues but weren’t overly impressed either. They are the “take it or leave it” type, likely to return unless tempted by a competitor’s offer.

While they can become Detractors, the flip side is that they can just as easily become Promoters with the right strategy. Keeping an eye on their sentiment, understanding their preferences, and addressing them can turn Passives into loyal customers.

9 – 10: Promoters – Your business promoters

This category represents customers who are highly satisfied with your business. Promoters actively refer your business to others, serving as cost-efficient advocates.

While having a high percentage of Promoters is a win, it’s not the end of the road. This group offers a unique advantage—they can provide insights into improving the customer experience.

Learning to calculate NPS is about maintaining Promoters and using their feedback for your business improvements.

Now that we know the needed information, let’s check how you can calculate this metric using a five-step process.

How to calculate your Net Promoter Score

Measuring your brand’s NPS is simpler than you think – follow these easy steps.

Step 1: Gather customer feedback

Collect feedback by posing the question: “On a scale of 0-10, how likely are you to recommend our company/product/service to a friend?”

You can do this through surveys, email follow-ups, pop-up notifications, or social media polls. Use a number scale (0-10) and give customers a chance to explain why. This helps find areas to improve.

Step 2: Categorize your responses

Based on their numerical responses, categorize customers into three groups:

• Promoters (Score 9-10):
• Example: If 50 out of 100 respondents gave a score of 9 or 10, there are 50 Promoters.
• Passives (Score 7-8):
• Example: If 30 out of 100 respondents gave a score of 7 or 8, there are 30 Passives.
• Detractors (Score 0-6):
• Example: If 20 out of 100 respondents gave a score of 0 to 6, there are 20 Detractors.

Step 3: Calculate each score percentage

Determine the percentage of respondents in each category:

• Promoters percentage:
• Formula: (Number of Promoters / Total Responses) * 100
• Example: (50 / 100) * 100 = 50%
• Passives percentage:
• Formula: (Number of Passives / Total Responses) * 100
• Example: (30 / 100) * 100 = 30%
• Detractors percentage:
• Formula: (Number of Detractors / Total Responses) * 100
• Example: (20 / 100) * 100 = 20%

Step 4: Calculate your Net Promoter Score

Subtract the percentage of Detractors from the percentage of Promoters.

Example: 50% – 20% = 30

Step 5: Interpret the NPS score

Your Net Promoter Score is a number that can range from -100 to +100. The score provides an overall measure of customer satisfaction and loyalty.

• If the result is positive (e.g., +20), it indicates a higher likelihood of customer recommendations.
• If the result is negative (e.g., -10), it suggests that improvements are needed to improve customer satisfaction.

Remember, the goal is to not just understand the score but to use it as a tool for continuous improvement. Regularly track your NPS and make informed business decisions based on the feedback provided by your customers.

Let Formaloo handle the calculations of your NPS.

Simplifying your NPS calculations with Formaloo is a simple process. You don’t need to follow all the steps mentioned above. Just use the drag-and-drop feature to integrate the NPS question effortlessly.

Customize your NPS survey to match your business requirements by adjusting the question, score range, and messages. Formaloo will automatically take care of the score calculations, ensuring accuracy without requiring manual efforts.

You can view clear visual charts in your survey results dashboard displaying your overall NPS score. This process allows you to manage and use customer insights effectively for informed business decisions without any unnecessary complications.

To categorize survey responses into Promoters, Passives, and Detractors, you can use variables and conditional logic. This involves using specific data placeholders (variables) and logical rules (conditional logic) to classify responses into these three groups.

You can set rules that say if someone rates 9 or 10, add 1 to Promoters. If they rate 7 or 8, add 1 to Passives. And if they rate 0 to 6, add 1 to Detractors. This method helps you find the percentage of Promoters, Passives, and Detractors in your Net Promoter Score survey.

Share insightful NPS reports

Taking action based on your NPS data is crucial for driving meaningful improvements in the customer experience.

One effective way to facilitate this is by creating and sharing a comprehensive NPS report. The report should include important information such as your overall NPS score. It should also include the number of Promoters, Passives, and Detractors. Additionally, it should include the answers to the open-ended question about why customers gave a specific rating.

A dynamic chart showcasing how your score evolves adds a valuable dimension, especially if you’ve measured NPS before. Additionally, incorporating results from key drivers—questions directly influencing your NPS—offers insights into your strengths and weaknesses.

With Formaloo, you can quickly create and personalize charts and tables by filtering customer segments or product tags.

To have the best effect, regularly send updated NPS reports to the right team members every 3-6 months. You can customize your team members’ access and show each team the relevant data.

Use NPS to maintain customer relationships

In summary, the Net Promoter Score is a helpful guide for your business. It helps you keep customers happy and build strong connections with them. By looking at the score results, you can fix issues early and ensure your customers stay satisfied with your brand.

To get started, just use our NPS survey templates to find out if people would recommend your brand. Sign up for free now and start exploring the amazing features it offers.

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