Your Net Promoter Score (NPS) not only shows how customers feel about your business, but it’s also an indication of how your business might do in the future. The creators of NPS, Fred Reichheld, Bain & Company, Inc., and Satmetrix Systems, Inc., found that the score correlates with future customer spending, income growth, and customer retention. How you measure NPS is an important part of how you use this metric for meaningful data and solutions. In this blog post, we’ll explore how to measure NPS accurately, and how to derive meaningful conclusions from it.
How to Measure NPS Accurately
What is NPS?
NPS is a measurement of customer happiness, and it is based on a single question; “How likely is it that you would recommend our company to a friend or colleague?” A customer can then select a response between zero and ten. The total NPS is derived by subtracting the percent of “detractors”—those who responded with a number between zero and six—from the percent of “promoters”—those who responded with a nine or a ten. Since these numbers are calculated as percents, the total NPS score can be anywhere between 100 and -100, regardless of the number of customers surveyed.
The simplicity of this measurement is part of what has made it so successful. NPS is used by SMBs and Fortune 500 companies alike to assess performance and improve the customer experience.
How to Collect NPS Accurately
An accurate NPS and actionable insights start with the right collection method. It is important to collect as many responses as possible, but without using methods that would skew results.
NPS responses are most commonly collected via automated emails. This allows business owners to reach a large group of customers in a short amount of time. This method also makes it easy to process responses and quickly calculate your NPS. However, this is not the only way to measure NPS. You can also use comment cards, pop-up surveys on your website, postcards, an in-store kiosk, text messages, or social media.
No matter what method you choose, it is important to know how to measure NPS without skewing results. Consider the following as you craft your NPS survey:
- Not enough people: The more people you poll, the more accurate your survey will be. A larger pool of respondents will help to reduce the significance of errors, such as a customer hitting the wrong button, and outliers, such as a customer who had an abnormal experience.
- Offering rewards: Promising a reward for an answer will increase the likelihood that the customer will respond positively. This is due to the reciprocity effect—the natural desire to return a favor—and positive recall—the reward is most prominent in the customer’s memory, not the overall customer experience. Rewards will make your NPS score artificially high.
- Whom you survey: How you measure NPS will affect who responds. Do you want to poll all customers, loyal customers, new customers, or a different group? Those who have signed up to receive your newsletter, for example, will be more likely to respond positively, since they have willingly elected to receive additional information from you.
- Scale of ten or five: The original NPS survey and the correlations derived from it are based on responses from zero to ten. To simplify the survey and increase the number of responses, some businesses use a scale of zero to five instead. Since this alters the original conditions, it may not be as accurate.
- Changing the question: Just as some businesses might change the scale, others might change the wording of the question. For example, some might use, “how happy are you with your service?” The original NPS question was carefully chosen by researchers, and altering the wording even slightly may affect its accuracy.
How to Increase NPS Responses
To measure NPS accurately, you need a large number of responses, but incentivizing responses can skew the results. This presents an obvious problem; how can you get customers to respond? Your customers are busy, and getting them to pay attention and fill in even a simple survey can be a challenge. Consider the following to increase responses without affecting the accuracy.
- Use pictures: Using emojis and pictures instead of numbers can make the survey more approachable and eye-catching, which will increase responses.
- Incorporate email best practices: a number of different factors can increase opens and engagement in NPS emails. Use compelling subject lines, keep your email brief, make sure it is viewable to all email clients, make it mobile-friendly, and always test before you send.
- Use a brief introduction: While it’s important to explain why you’re surveying your customers, keep the introduction copy as brief as possible. Make sure the question and response section is viewable without scrolling.
- Spotlight the survey: Use graphics, an attractive color scheme, and appropriate font size and spacing to ensure that the survey portion of the email is obvious and clear.
- Collect responses directly in the email: The best way to increase NPS responses is to minimize the number of actions required. If your customer clicks their answer in the email and is then directed to another page to provide it again, they’re more likely to click away.
- Send from a real person: Emails sent from a general email address are more likely to go into spam and trash folders. You can still automate this email survey, but make sure the sender address is a real person’s.
How to Measure NPS as Useful Data
Obtaining accurate NPS data is only half the battle. It is also important to know how to measure NPS in a usable way, and how to determine what these insights mean. This will help you to draw conclusions that you can use to improve your overall customer experience.
- Use the right benchmarks: Different industries have different NPS baselines. You wouldn’t compare the business operations of a restaurant to a chemical manufacturer, and it doesn’t make sense to compare their NPS benchmarks either. Use NPS data that makes sense for your industry, as well as your business model. For example, if you focus on customer loyalty, your NPS should be high. If you focus more on customer volume, your NPS will probably be lower.
- Measurement over time: Measuring NPS once can tell you how you’re doing, but you won’t be able to see if you’ve improved unless you measure NPS again. When you conduct the survey, do it the same time, in much the same way each year, so your results aren’t skewed by extraneous factors.
- Determine who you are asking and why: Did you poll all customers, loyal customers or new customers? Each will give you different insights about your operations. For example, if new customers are generally happier than existing customers, it means your loyalty program or customer service might be lacking.
NPS provides fairly strict guidelines as far as what a survey should ask, but how you use the information is up to you. Before you decide how to measure NPS, you should know what questions you would like to answer. You should also have some thoughts on how you will use this data to improve your customer experience. This way, your NPS will provide real ROI.
Posted in: Customer Feedback