Net promoter score

The definition of Net Promoter Score, is the metric used to measure customer satisfaction and the probability of them referring that product, company or service to a friend or family member. In HR, the best application is ENPS.

Do you know what NPS is? As a customer, for sure, you have already answered the following question at some point : “On a scale of 0 to 10, how much would you recommend our company?”. This simple question is the basis for what we call the Net Promoter Score (NPS), which is nothing more than a metric for measuring customer satisfaction for a particular brand.

In addition, NPS can be a powerful tool for the Human Resources sector within the organizational environment , simply replacing the survey on consumer satisfaction with the quality of the experience of employees and candidates for a vacancy in the company.

After all, a motivated and engaged employee, as well as a customer, becomes a brand promoter, by recommending the company’s product or service to friends and family, in addition to expressing to professional colleagues, in their networks, how the organization is a great place to work and develop professionally. Thus, your business will attract the best talent in the market.

Interested in knowing more about what NPS is, how to calculate and use it in your organization’s HR? Keep reading until the end and understand everything about it!

Purpose of net promoter store

The Net Promoter Score (NPS) has become one of the main methodologies used to measure the satisfaction of a company’s customers, regardless of its segment.

Created in the early 2000s by business strategist and speaker Fred Reichheld, this metric can be used both to identify potential brand detractors and to measure consumers willing to promote and refer the company to friends and family.

In this sense, promoting consumers reduce the cost of acquiring new customers , in addition to facilitating service , since they know and trust the brand, increasing empathy in the most diverse situations that can occur between the business and the customer.

Otherwise, detractors, who are consumers who had a negative experience with the company, put the organization’s image in the market at risk by badmouthing the brand to friends and family, in addition to even suggesting it on consumer experience sites and on social networks that people do not hire your service or purchase your product.

Finally, there are consumers considered neutral, who occasionally consume the company’s product or service, but have not yet had a differentiated experience that has made them loyal to the brand.

Advantages of measuring net promoter store in the company?

Currently, for a company to remain in the market, it is essential to understand how the customer journey is going from the first contact with the organization to after-sales support.

This is because, in an increasingly competitive market, in which e-commerce allows the customer to purchase a product or service with just one “click”, providing a differentiated experience is the key to obtaining more than customers, and then making it the brand promoters.

According to Philip Kotler, considered the father of digital marketing: “ the amount spent to attract a new customer can be five to seven times greater than the cost to maintain proximity with an old customer ”.

Still, there are other benefits in understanding what NPS is and knowing how to use it in your company. So, let’s introduce some of them.

1-simple and fast

One of the main advantages of this methodology is that, through a single question, you get all the answers to measure customer satisfaction. Still, the NPS is an easy metric to calculate, having in its result a quantifiable value.

2-Comparable

One of the most competitive strategies for a company to remain in the market is to know how it is seen in relation to its competitors.

Thus, managers and leaders can create actions that differentiate the organization from others that operate in the same segment.

So, since most companies use this metric, there will always be solid data to compare their customers’ satisfaction against their competitors’ NPS.

3-Parameter recognized in the market

NPS is a standardized and proven method of measuring customer satisfaction levels.

Therefore, the methodology gained trust and has been used by brands that are a reference in the market, such as American Express, Apple, Magazine Luiza, among others.

How to calculate net promoter store?

Now that you understand what NPS is and its advantages of applying it in the company, also understand how simple it is to measure it. The calculation is as follows:

NPS = % promoting customers – % detracting customers

As an example, imagine a scenario with 100 responses collected. Among them, 60 were responses 9 or 10, that is, they are from promoting customers and 5 were evaluations from 0 to 6.

So, the calculation looks like this:

NPS = 60 – 5

So the NPS will be = 55.

To know if this is a positive or negative NPS, we will explain how to evaluate the results in the next topic. Keep reading! Net promoter score definition

How to evaluate net promoter store results?

To measure NPS survey results, there are basically four ranking zones. See how it works!

1-Zone of Excellence: score between 75 and 100

If your company has reached this score, know that it certainly provides an excellent experience to your customers , making them become brand promoters, recommending your product or service to friends, family and on social networks.

2-Quality Zone: score between 50 and 74

Here, customers found positive points in their journey, but they also saw aspects that they did not like, harming the experience.

Therefore, when obtaining this score, the company needs to analyze its persona and understand in which aspects it needs to improve to provide a better perception of the customer in front of the brand.

3-Enhancement Zone: score between 0 and 49

At this level of NPS, the company needs to pay attention to the feedback that customers have been offering about their purchase and after-sales journey. Net promoter score definition

Soon after, managers and leaders must develop and put into practice actions that improve consumer satisfaction so that they become brand promoters once and for all.

4-Critical Zone: score between -100 and -1

This is a warning sign showing that the relationship between business and consumer is definitely not going well.

Thus, in the critical zone, the company will be creating brand detractors, that is, dissatisfied customers who, in addition to complaining, will not recommend its brand and may even speak badly about it to their circle of friends.

At this point, the company needs to take urgent measures to reverse the situation, causing the customer to review its positioning and return to consume its product or service.