The NPS is the right marketing metric to use if business growth is what you are trying to achieve. Learn what NPS is and how to apply it to your customers. The presentation introduces NPS and its conceptual background, explains what it is and how it works, describes the process of applying it in real life, and provides a step-by-step guide for practitioners with no or little experience in statistics and analytics. Guide link --> https://neoretailing.com/product/guide-nps/

1. Net Promotor Score
(NPS)
The Marketing Approach to Managing Growth and Profitability

2. Background
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3. NPS vs. Customer Satisfaction by Business Size
Large Businesses consider the
NPS metric more important
than small businesses do.
&
Large Businesses consider
Customer Satisfaction metrics
less important than small
businesses do.
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4. Conceptual Background of NPS
Business growth and profitability are driven by behavioural loyalty...
thus, they should be measured using behavioural indicators instead
of attitudinal indicators.
Recommending something to a friend or colleague is a strong
indicator of customer loyalty in most industries.
Customers, willing to put their reputation under social judgement and
take the risk of destroying it, are loyal customers.
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5. What is NPS?
NPS is a marketing metric used to:
• measure customer loyalty;
• deliver growth; and
• increase net profit.
The NPS metric uses an 11-point scale to measure customers’ willingness to
recommend a product/brand/store/website to a friend or colleague.
Not at all
likely
How likely is it that you would recommend [product/store/website] to a friend or colleague?
Extremely
likely⓿ ❶ ❷ ❸ ❹ ❺ ❻ ❼ ❽ ❾ ❿
Neutral
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6. Why NPS?
• Strong correlation with business growth
and profitability in most industries;
• Simplicity;
• Quick implementation;
• Easy to interpret;
• Easy to communicate; and
• Inexpensive.
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7. How does NPS work?
1st: Identify 3 groups of customers
Not at all
likely
How likely is it that you’d recommend [product/store/website] to a friend or colleague?
Extremely
likely
⓿ ❶ ❷ ❸ ❹ ❺ ❻ ❼ ❽ ❾ ❿
         ☺ ☺
Group: Description: Score on Scale
1 Promotors ☺
The most enthusiastic customers who have the highest rates of
repurchase and referral.
❾-❿
2 Passively Satisfied 
Customers who are opportunity-driven and open to switch to
competitors at any time and for any reason.
❼-❽
3 Detractors 
Disappointed customers who can do serious damage to your
product/brand through sharing their negative experiences with
friends, family, colleagues, and other potential prospects.
⓿-❻
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8. How does NPS work?
2nd: Calculate NPS
Not at all
likely
How likely is it that you’d recommend [product/store/website] to a friend or colleague?
Extremely
likely
⓿ ❶ ❷ ❸ ❹ ❺ ❻ ❼ ❽ ❾ ❿
         ☺ ☺
NPS = ☺ % -  %
NPS Interpretation Action
+ Your company has more promotors than detractors Retain promotors and convert detractors into loyal customers
− Your company has more detractors than promotors Study and compare the two groups to learn what makes promotors
loyal and detractors disloyal.
0 Your company has an equal number of detractors than promotors Study and compare the two groups to learn what makes promotors
loyal and detractors disloyal.
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9. The Process of Applying NPS
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10. Step 1: Ask
Ask your customers to rate their willingness to recommend your
product/brand/store/website to a friend or colleague.
Not at all
likely
How likely is it that you’d recommend [product/brand/store/website’s name] to a friend or colleague?
Extremely
likely          
Neutral
Code: 0 1 2 3 4 5 6 7 8 9 10
Methods of data collection include:
- Survey/questionnaires
- E-mail
- Pop-up windows on website
- Purchase feedback/follow-ups
- Social media platforms
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11. Step 2: Analyse
Use software like Excel, SPSS, and/or SAS to calculate and analyse NPS
This step could be an uncomfortable step for practitioners
with little or no background in statistics/analytics.!
Step-by-Step Guide to Calculating and Analysing NPS Using Excel

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12. Step 3: Act
Goal

Task
Identify differences, relationships,
and/or best practices that can be shared
to improve NPS.
Compare NPS across the three groups
and in relation to other variables (i.e.
geographic variables like cities,
demographic variables like annual
income, and/or behavioural variables
like time spent in store).
There are several ways to compare sets of data. The Step-by-Step
Guide to Calculating and Analysing NPS Using Excel demonstrates
two simple, yet useful, methods.
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13. Conclusion
• Use the knowledge you gained to increase NPS.
• A successful application of NPS requires:
• transparency;
• good understanding of what needs to be changed/improved; and
• good two-way communications with others within the
organisation.
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14. Follow Us
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