What NPS Means, Why It's Important, and How to Calculate It

What NPS means is Net Promoter Score, which is a metric used to measure customer experience success and specifically the loyalty customers have for your company. NPS is different from similar metrics like customer satisfaction score because it measures customers' general feeling toward a brand overall rather than how their experience with singular interaction or purchase has gone.

How is NPS Calculated?

The way to calculate your NPS is to survey your customers and score their answers based on how likely they are to become or continue being repeat customers, how likely they are to recommend your goods or services. Check out this HubSpot post to learn more.

Customers are then put into 3 categories based on the answers they give.

• Promoters to your brand
• Passives to your band
• Detractors to your brand

The net promoter score is calculated by subtracting the percentage of Detractors from the percentage of Promoters.

What is a Good NPS Score?

This question is difficult to answer with a specific number, but the key idea is to track your NPS. If you are tracking it and it is improving, that is a good sign. You will need to establish your own baseline and a good place to start is comparing your score to similar businesses in your industry. You can see what businesses in your industry generally consider a ‘good NPS' here.

Why is NPS so Important

The reality is that almost all businesses will have more Detractors than Promoters. To top that off, detractors are more vocal about their opinions than promoters. All winning brands have a good NPS and it is a key indicator of a business's growability.

• Promoters Renew – They will continue to use your products and services for years.
• Promoters Expand – In a B2B setting they will expand their use of your products and services as they grow.
• Promoters Forgive – Hiccups happen to all businesses sooner or later. Late delivers and service outages will be taken in stride by Promoters who tend to be more likely to continue being customers when they have an unsatisfactory experience.
• Promoters Promote – They will share content on social media and spread word of mouth to raise awareness of your brand.
• Read more in a recent GainInsight.com post.

At Fidesic, we launched an NPS program a few months ago and our current NPS of 44 puts us ahead of 70% of other software vendors, but we're not done. We're working to keep our customers happy directly and we have seen insights on what segments of our products people love and what we can improve.

At Fidesic we know that if your work life is improved, in most cases your quality of life also improves. We want to make your daily ‘grind' as enjoyable as possible, because everyone is entitled to joy at work. We base all development decisions on the voice of the customer, so if there's something we can do to make your work-life better, let us know, we'd love to hear from you.