How to Use Net-Promoter Score (NPS) To Grow Your Business
Do you want to know how to improve your business? There is a great tool that can help you do just that called Net-Promoter Score (NPS). NPS is a metric used to measure customer loyalty and satisfaction. It was created by Fred Reichheld, a Bain & Company partner and one of the fathers of modern marketing. In this blog post, we will discuss what NPS is, how it works and how you can use it to grow your business!
What is NPS?
Net-Promoter Score (NPS) is a customer loyalty metric that measures how likely customers are to recommend your business to others. NPS is calculated by asking customers two simple questions:
1. How likely are you to recommend our company/product/service to your friends or family?
2. How likely are you to continue doing business with us?
Customers respond on a scale of 0-10, with 0 being the least likely and 10 being the most likely. NPS scores can range from -100 to 100. A score of 50 or above is considered excellent, while a score below zero is considered poor.
How NPS Works
NPS works by measuring customer loyalty and satisfaction. It is based on the principle that it is more expensive to acquire new customers than it is to keep existing ones. Therefore, NPS can be used as a tool to help businesses retain their best customers and grow their business.
NPS can be used in a number of different ways, but one of the most common is to use it as a customer satisfaction metric. NPS can also be used to measure employee engagement and to track changes in customer sentiment over time.
There are a few different ways to calculate NPS, but the most common method is to take the percentage of customers who are "promoters" (those who give a score of 9 or 10) and subtract the percentage of customers who are "detractors" (those who give a score of 0-6).
For example, if 50% of customers are promoters and 20% are detractors, then the NPS would be 30.
How to Use NPS to Grow Your Business
There are a number of ways that NPS can be used to grow your business. NPS can be used to:
-Improve customer satisfaction: NPS can be used as a tool to measure and improve customer satisfaction. By tracking NPS scores over time, businesses can see how satisfied their customers are and make changes accordingly.
-Increase customer loyalty: NPS can also be used to increase customer loyalty. By understanding what makes customers loyal, businesses can make changes to improve loyalty. NPS can also be used to identify which customers are at risk of leaving and take steps to keep them.
-Improve employee engagement: NPS can also be used to improve employee engagement. By tracking NPS scores, businesses can see how engaged their employees are and make changes to improve engagement.
-Generate word-of-mouth marketing: NPS can also be used to generate word-of-mouth marketing. Promoters are more likely to recommend a business to others, so by tracking NPS businesses can see which customers are most likely to generate word-of-mouth marketing.
NPS can be a valuable tool for businesses of all sizes. By understanding what NPS is and how it works, businesses can use NPS to improve customer satisfaction, loyalty and engagement, and generate word-of-mouth marketing.
If you are thinking you would like to implement this for your business, contact the Lincolnshire Marketing Team for support.
