Net Promoter Score® is a Customer Experience metric that companies across the world use to predict Growth. It measures overall Customer Satisfaction and Loyalty. Numr, a market research company in India recommends tracking NPS® regularly to optimise your CX program.
After all, Net Promoter Score® is a strong indicator of a company’s relationship with its customers.
NET PROMOTER SCORE® AND CUSTOMER ACQUISITION
Undeniably, Net Promoter Score® helps companies acquire more customers. Because, NPS® measure loyalty based on recommendations, it encourages referrals. Basically, Net Promoter Score® is calculated by asking respondents,
“How likely are you to recommend (a product/service) to others?”
And, the score is calculated by subtracting the percentage of Detractors from Promoters. (Also, read more on that, here.)
Basically, the objective of an NPS® program is to reduce Customer Attrition and increase Retention. However, it does so by increasing the number of Promoters. Furthermore, an efficient NPS® converts existing customers into enthusiastic Brand Advocates (Promoters).
In short, Net Promoter Score® quantifies Recommendations/ Referrals. And, referrals are the best form of advertising.
To emphasize, as per Nielsen, 92% of people trust recommendations from friends and family over any other type of advertising. Furthermore, word-of-mouth marketing influences about 20-50% of all purchases. After all, more promoters lead to more referrals, which leads to more new customers. Hence, companies with companies with the top NPS® scores in their industry outgrow their competition by 20%.
In short, a high Net Promoter Score is an indicator of high number of Promoters. Which, in turn means that there is an increased chance of recommendations/referrals. Furthermore, this denotes a higher probability of Customer Acquisition and ultimately, growth.
Moreover, companies with a high NPS® know the importance of increasing Promoters. Numr, a market research company in India suggests that companies should use their NPS® data to fuel all marketing and customer success strategies to boost growth.
*Net promoter Score® and NPS® are registered trademarks of Bain & Company, Satmetrix and Fred Reichheld