We all know that word of mouth is a powerful marketing tool, but do you know how many of your customers would recommend your company to a friend or colleague? Finding the answer isn’t as hard as you may think.
With a simple tool called Net Promoters Score (NPS®), you can determine how your customers feel about your brand. NPS was first introduced by Fred Reichheld in a 2003 article in the Harvard Business Review. Since then, several companies have used NPS to find out what their customers think so that they can improve their business.
Basically, the metric was designed to be a less complicated method of tracking customer loyalty and brand performance. A company can obtain its score by asking customers one single question: “How likely is it that you would recommend the company to a friend or colleague?” Based on the responses, which are rated from 0 to 10, customers can be categorized into one of three groups: Promoters (9-10 rating), Passives (7-8 rating), and Detractors (0-6 rating). The overall Net Promoters Score is taken from the percentage of Promoters minus the percentage of Detractors.
While finding out your score shows how your brand is performing, it is a follow-up question to those who rate it 8 or less than can really benefit the business. By asking “What would it take to have you score the company a 9 or 10?” you can receive valuable, actionable content that the company can use to strengthen its performance and improve customer loyalty.
If you would like to see a real-world example of how NPS has benefited a company, read this case study on Carolina Biological Supply, a leading global supplier of biological and science teaching materials.