(Newswire.net — October 4, 2021) —
For the longest time, word-of-mouth recommendations have influenced purchasing decisions significantly in every industry. Everyone loves hearing about excellent services or products from trustworthy sources. As a matter of fact, about 92% of consumers trust word-of-mouth more than advertising.
What are Net Promoter Scores, and what do they have to do with this? Simply put, Net Promoter Scores are customer loyalty and satisfaction measurements. These measurements gauge how likely your customers are to recommend your products or services to others on a scale of 0-10.
How do they work, and how do you measure NPS? Well, we have written a comprehensive guide that will help you understand everything you need to know about Net Promoter Scores.
Keep reading to find out how you can grow your business by understanding NPS.
What Is NPS?
When you build trust with customers, you simultaneously create brand ambassadors who are willing to recommend your products to their networks. They are so enthusiastic about your products that they share with their friends, family, co-workers, among others. In this digital age, most go the extra mile and leave positive reviews online for everyone to see.
Technically, you use Net Promoter Scores, or NPS, to gauge how loyal, satisfied, and enthusiastic your customers are. You do all this by asking them how likely they are to recommend your product or service on a scale of 0 to 10. The scores you get will help you improve your products or service, customer support, delivery, and much more to increase customer loyalty.
What Makes NPS so Important for Business?
This is essentially a business metric that will help you understand that you need to change something to earn more enthusiastic customers. You can track and quantify this over time and learn more about what changes to make. If your company’s Net Promoter Scores are high, you know you have healthy relationships with customers.
You know that you have brand promoters who will not only come back but bring more people with them. This essentially generates a positive growth cycle, making NPS a valuable metric because it leads to more important questions. For instance, you can contact a standard survey and ask customers why they’ve given those specific scores.
This will help you understand what you’re doing right, what you’re doing wrong, and what areas require improvements. If your scores are low, you can create internal Net Promoter Score benchmarks. For instance, send your employees on a mission-critical goal, which is to earn more enthusiastic customers.
How Do You Calculate NPS?
When calculating your Net Promoter Score, you’ll use a Net Promoter scale that features three categories. You’ll categorize your customers into three groups, which are promoters, detractors, and passives, based on the number they give you from 0 to 10. The customers who answer the NPS question with number six or lower are the detractors.
The customers who answer with nine or 10 are the promoters, while those in between six and nine are passives. The promoters that fall on 9 and 10 are the most enthusiastic and loyal customers. They are the most likely to recommend your products or services, enhance your reputation, and help grow your business through referrals.
The detractors who fall between zero and six are highly unlikely to recommend your company or products to others. These customers are unlikely to make repeat purchases and may actively discourage other potential customers from your brand.
On the other hand, passives fall on seven and eight and won’t actively recommend your brand. However, they are also unlikely to leave negative reviews or give negative word-of-mouth. Passives are very close to becoming promoters, making it critical for you to investigate how to win them over.
Now to calculate your NPS, you’ll subtract your percentage of detractors from your percentage of promoters.
How Do You Interpret Your Net Promoter Scores?
In order for you to improve NPS, you need to understand the average score. You see, when you are more attractive than promoters, then you have a negative score. When you have more promoters, then you have a positive score, and more passives put you in the middle.
When it comes to Net Promoter Scores, the average will vary greatly between different industries. You need to understand your NPS average score in your industry and how your competitors are doing. Understand what constitutes a good or bad score.
How Do You Collect Customer Feedback?
If you’re looking for NPS best practices, the first thing you have to do is collect customer feedback. This will help you calculate and track NPS for your business. There are two main ways to collect customer feedback, which are website surveys and email surveys.
Website surveys will allow you to capture customer feedback when they are on your website. You can set it up on your main conversion page or use an exit survey right before customers leave your website. Start by asking how likely they are to recommend your company to a friend on a scale of 0 to 10.
If the customer is a detractor, you’ll apologize for the negative experience and enquire what you can do to improve their score. If the customer is a promoter, you will be grateful for the enthusiasm and inquire about the main reasons for loving your business. You can go the extra mile and ask them to share ideas on what else you could do to improve your brand and the customer experience.
When using the email survey, you’ll collect customer data by emailing your customers and inviting them to fill up a form. One thing about email surveys is that they are more involved and require more work. Your customers will need to open the email, click on the surveys, fill and submit the form.
What Are Net Promoter Scores and How Can They Grow Your Business?
So, what are Net Promoter Scores exactly? They are critical metrics that will help you understand how customers perceive your brand.
Even though NPS measurements are based on customer experience, they have been proven to work. This is an excellent metric to measure your business growth as it helps you learn what you can do to improve and scale your company.
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