Net Promoter Score (NPS)

Net Promoter Score (NPS) is a customer loyalty metric that measures how likely a customer is to recommend a company, product, or service to their friends or colleagues. It involves asking customers a single question on a 0 to 10 rating scale - “How likely are you to recommend this product/service/company to a friend or colleague?” - and categorizing their responses into groups:

When to use

Net Promoter Score can be used at various stages of the product development cycle to assess customer loyalty and satisfaction. It is particularly useful for evaluating the effectiveness of changes made to a product or service, as well as for benchmarking against competitors. NPS can also be used to track changes in customer loyalty over time.

Pros

  • Provides a simple and standardized metric for measuring customer loyalty.
  • Can be used to compare customer loyalty across different products, services, or companies.
  • Provides a clear indicator of customer satisfaction and potential for customer retention.
  • Easy to administer and analyze.

Cons

  • Only measures a customer’s likelihood to recommend, without providing detailed information on why they would or would not recommend a product or service.
  • Responses can be influenced by factors outside of the company’s control, such as personal relationships or situational factors.
  • Can be affected by differences in how respondents interpret the scale or the question itself.
  • Should not be used as the sole measure of customer satisfaction, and should be supplemented with other qualitative and quantitative research methods.

Learn more in the User Research: Comprehensive Guide article.

© Aleks Petrov, 2023
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