Net Promoter Score (NPS)
Category: Strategic
Gauges customer loyalty based on the likelihood of recommending your product or service.
What it Measures ?
How happy customers are with us.
Relevant StakeHolders
Customer Success, Sales Leadership, Marketing
Why it Matters ?
Tracks customer loyalty by measuring likelihood to recommend your brand.
In-depth Use Case / Real-world Example
A manufacturer asks customers, “How likely are you to recommend us on a scale of 0–10?” Scores of 9–10 are promoters, 7–8 are passive, and 0–6 are detractors. If 60% are promoters and 10% are detractors, NPS is 60–10 = 50. A higher NPS means happier customers and more referral potential.
Sample Formula
Customer Surveys: Promoters - Detractors / Total Responses