Customer loyalty is one of the pillars of any sales or marketing strategy, and NPS is the way to measure it. We tell you what it is and how to use it.
When it comes to retaining a customer , there may be many strategies, training on the subject, incentives, etc., but a fundamental part of the process is analyzing whether we are achieving the objective.
The Net Promoter Score, or NPS, exists for this. We tell you all about it in this post.
What is NPS (Net Promoter Score)?
Coined in 2003 by Frederick F. Reichheld in a Harvard Business Review article , NPS is a score used to measure customer satisfaction and loyalty. In particular, it seeks to answer a simple question: how likely is that consumer to recommend your products or services, brands or otherwise?
The way it is formulated can vary, but it always has the costa rica phone number same approach. The most well-known is through a simple question such as:
How likely are you to recommend the product to a friend?
To answer, you should use a scale of one to ten, since open-ended answers (such as an explanation of why you would do it) are not very useful in this case. Even though this is extremely valuable information, the NPS is calculated with values to be able to establish four types of clients, according to the score obtained:
Promoters
Liabilities
Indifferent
Detractors
The meaning of this analysis is not only about loyalty , but also about the possibility of a customer being a spokesperson for the brand or the product/service. This is the most important objective for any consolidated business: if it is achieved, the efforts will have been successful and the organization will need much less sales push work.
How to formulate and account for NPS?
Although it may seem simple, there are some key points that should never be overlooked. The survey that is conducted should:
Be easy to perform.
Be clear and direct.
Present the results in a simple way so that they can be worked on quickly.
Be understandable to everyone: from customers to employees not related to the questionnaire.
Values and results
The NPS question should be answered on a scale from one to ten. Each answer will be linked to a simple formula:
If the person answers nine or ten, they are a promoter . This means that this customer is highly likely to recommend our business to someone else and is unlikely to leave us.
If the person answers seven or eight, he or she is passive . This means that there is no firm decision regarding promotion or loyalty to our organization.
The case of those who are indifferent (five or six) and those who are detractors (one to five) refers to cases that are not only not satisfied with what we offer, but can also work against us when it comes to recommending to others.