Surveys
Introduction
Priya is responsible for customer success in a growing SaaS business. Every quarter she asks her customers how likely they are to recommend the product. She includes a few extra questions to get as much feedback as possible. Unfortunately, this has lowered her response rates and made it difficult to understand her results. Her team have calculated an NPS of 42 – but it’s unclear what this score means, why it is the way it is and what they should do next.
Three months later some of the satisfied customers decide not to renew.
The issue isn’t the score itself but how you’re asking for, analysing and acting upon customer feedback.
Net Promoter Score is a simple way to measure how likely your customers are to recommend your business, product or service. However, it won’t provide insight into every element of your customer experience. In order for it to be useful, you’ll need to ask the right question, understand the responses, fairly compare the results and act on the feedback.
This guide will walk you through what Net Promoter Score means, how to calculate it, what a good score looks like, how to design a great NPS survey and how to use the data to improve customer loyalty.
What Is Net Promoter Score (NPS)?
Net Promoter Score is a metric used to measure customer loyalty. It asks how likely people are to recommend your company, product or service.
The question is:
It is based on one standard question:
"On a scale of 0 to 10, how likely are you to recommend our company, product, or service to a friend or colleague?"
Based on their feedback, customers will be split into three categories:
Promoters (9-10): These customers are very likely to recommend your business. They generally had a positive experience and may be repeat buyers/advocates.
Passives (7-8): These customers are fairly satisfied but not overly enthusiastic. They could easily be tempted away by a better offer from the competition.
Detractors (0-6): These customers are less likely to recommend your business. Their feedback may indicate issues with your product, service, support or overall experience.
It was introduced by Fred Reichheld at Bain & Company in 2003. Whilst Net Promoter Score provides a common language for teams to discuss customer loyalty, it is best paired with other feedback and business metrics.
For example, you may have a positive NPS score but still receive feedback from customers about onboarding or billing. It shows you have more promoters than detractors but the feedback will help explain why.
How to Calculate Net Promoter Score
There is a simple formula to calculate your Net Promoter Score.
NPS = % Promoters - % Detractors
Passive customers are included in your total number of responses but won’t be counted in the equation.
Example
Say you have 200 customers complete your survey.
Response Group | Number | Percentage |
|---|---|---|
Promoters | 110 | 55% |
Passives | 60 | 30% |
Detractors | 30 | 15% |
Total | 200 | 100% |
Using the formula:
NPS = 55 − 15 = 40
Your NPS score is +40.
Scores can range from -100 to +100.
+100 – All customers scored as promoters.
0 – Equal number of promoters and detractors.
-100 – All customers scored as detractors.
Whilst using an NPS calculator can save you time, especially with large amounts of data, understanding the formula will help you verify the score and explain it to your team.
What Is a Good NPS Score?
depends on your industry and what your customers expect. It also depends on how you are asking for feedback and who is responding. What Is a good score in one sector may be average in another.
As a general rule of thumb many businesses will look at the following:
Score | Meaning |
|---|---|
Less than 0 | More detractors than promoters. |
0-30 | Positive score but there is room for improvement. |
31-50 | Generally a good score. |
51-70 | Very good score showing great customer advocacy. |
Greater than 70 | Excellent score. |
These aren’t industry standard scores. They should be used as a starting point. Comparing against benchmark reports can vary as they may be using a different sample, channel and methodology.
How to Evaluate Your NPS Score
Rather than just looking at the score, look at three areas:
Compare with your Industry
Look for credible benchmark reports for your industry. Don’t compare with a hotel, bank or retailer if you are in software. Customer expectations will vary between different industries.
Compare with Past Data
Look at how your score has changed over a period of time. Even if another company has a higher score, you may have seen a significant improvement from +15 to +28.
Compare Between Customer Segments
Break your data down by customer type, plan, region, length of time with the business and their experience. Your overall NPS may be looking good but you could have a poor experience with a specific group of customers.
For example, you may have long term customers recommending your product but new customers struggling to set it up.
Relationship & Transactional NPS Surveys
Choosing the right type of NPS survey will help you understand what your scores mean.
Relationship NPS
A relationship NPS survey asks customers how they feel about their relationship with your business. This is usually done on a regular basis, for example quarterly or annually.
A SaaS business may ask active customers how likely they are to recommend their platform after using it for a few months. This helps teams understand how customers are feeling about their overall loyalty.
Transactional NPS
A transactional NPS survey asks customers after a specific interaction. This could be after a support interaction, purchase, onboarding or service.
For example, an online retailer may ask customers how likely they are to recommend shortly after they’ve received their order.
This is an important distinction to make, as relationship NPS relates to the overall relationship with your customers whereas transactional relates to a specific interaction. Do not treat both as interchangeable.
Asking the Right Questions in Your NPS Survey
Ask a standard question to begin with. Then ask an open-ended question to help understand why they gave the score they did.
Keep your survey short and neutral. A lengthy survey can put customers off completing it.
Ask a standard question
Ask the same question each time to help compare your results over time. Using the same scale will also help.
"On a scale of 0 to 10, how likely are you to recommend our product to a friend or colleague?"
If you’re in a service based industry, replace ‘product’ with ‘service.’. Also try to keep the question the same between surveys unless there is a specific reason to change it.
Ask an open-ended question
Ask a question to help understand why they gave the score they did.
Why did you give this score? (All customers)
What can we do to improve your experience? (Detractors)
What can we do to make our product/service more valuable? (Passives)
What do you value most about your experience? (Promoters)
You don’t need to ask all of these questions. Usually one relevant question will be sufficient to allow customers to explain their answers.
Tips for designing your NPS survey
Use simple language.
Avoid leading questions.
Use the same scale.
Make it easy to complete on a mobile.
Include a brief explanation for why you’re asking.
Don’t ask for unnecessary personal information.
Thank them for their time.
If you’re unsure where to start take a look at some examples of customer feedback forms here. Then tailor it to your audience.
How to Run an NPS Survey
Having a clear goal for your NPS programme will help you get the most out of it.
1. Determine your goal
Identify what you want to learn. Are you looking to understand overall customer loyalty, onboarding, support or any issues with your product? Having a clear goal will help you determine who to ask and when.
2. Decide on survey type
Use relationship if you want to understand the overall relationship. Use transactional if you want feedback on a specific interaction.
3. Decide on who to ask
Will you ask all active customers or a specific group? For example new subscribers or those who have recently had support.
4. Design your questions
Ask your standard question and one relevant open-ended question. Keep it neutral.
5. Decide on your channel
Ask your survey via email, in-app, on your website or another channel your customers use regularly.
6. Test your survey
Send it to a small group of internal or customers to test. Ensure the scoring works, questions are clear and it looks good on mobile.
7. Set a reasonable timeframe
Give customers a reasonable amount of time to complete it. Adding a reminder can help but don’t ask too many times as it can cause survey fatigue.
8. Calculate your score
Calculate your score and take a look at how many promoters, passives and detractors you have. Read through the comments.
9. Thank customers and ask again
Thank customers for their feedback. Where relevant get in touch with those who have raised any concerns. Ask again at regular intervals to spot trends.
How to Analyse Your NPS Results
Once you’ve gathered your responses the real value comes from understanding What Is happening. This will help you make improvements.
Firstly look beyond the overall score. If your score has dropped, are you seeing a drop with a specific group of customers, product or at a certain point in the customer journey?
Then look at the open-ended responses and group them into themes. You may find common themes such as price, ease-of-use, support, delivery, reliability or missing features.
For example if several detractors mention they struggled to get started with your software, take a look at your onboarding process. Simplify your set up instructions, improve your support or introduce a guided introduction.
You can also compare your survey results with other customer experience metrics. For example, Customer Satisfaction Score (CSAT), customer retention, support resolution time and product usage. These will answer different questions but will give you a fuller picture.
If you want to measure satisfaction with a specific interaction you can use a CSAT calculator.
How to Improve Your Net Promoter Score
Improving your NPS isn’t about persuading customers to give a higher score. It’s about improving the customer experience so they really feel more positive about your business.
1. Follow up with your detractors
A low score is an opportunity to understand what went wrong. Thank the customer, apologise and ask if there is anything you can do to help. Don’t make it sound like you’re being defensive.
2. Learn from your promoters
Promoters can help you understand what you’re doing well. Look for any recurring positive themes such as great support, ease-of-use, reliability or quality. Use this to improve the experience for other customers.
3. Understand why your passives are passive
They may not have a major issue but something is preventing them from being enthusiastic. Use their comments to understand how you can make small improvements. For example, clearer pricing, better documentation or an easier onboarding process.
4. Fix recurring issues
If customers are mentioning the same issue regularly, assign an owner and realistic timeline. Prioritise based on how many customers it affects and how much it is impacting their experience.
5. Share findings with the right teams
Share any relevant findings with your product, support, sales and customer success teams. Customer loyalty doesn’t belong to one team, everyone will impact different parts of the experience.
6. Measure improvements
Once you’ve made improvements take a look at the comments and new NPS score. Look at how the impacted customers have changed.
Common Mistakes to Avoid
Even if you have a well designed survey, you can end up with misleading results.
Only asking happy customers – This will skew your results and give you a higher score than you should have.
Changing the question often – This will make it harder to compare results.
Ignoring response rates – If you only have a few responses you may have a high score but it won’t reflect your full customer base.
Treating it as your only success metric – It won’t tell you everything about customer satisfaction, product quality or retention.
Asking too often – This will frustrate customers.
Ignoring comments – The score will tell you how many promoters and detractors you have but the comments will often tell you why.
Not following up – Customers may stop giving feedback if they don’t see any meaningful action being taken.
Choosing an NPS Survey Tool
Whilst you can ask for responses using a simple form, using an NPS survey tool will make it easier to ask and analyse your results as your customer base grows.
Look for a tool with:
Scoring – This should allow you to ask your standard 0-10 question.
Open-ended questions – Allow customers to explain why they gave the score they did.
Logic – Ask follow up questions based on their answer.
Sharing – Send via email, on your website etc.
Mobile friendly – Easy to complete on a smaller screen.
Reporting – Clear reporting of responses. Ability to export.
Integrations – Connect with your existing tools to save time.
Take a look at how they handle analytics and integrations.
If you’re looking for an easy to use tool to create a simple survey Ovoform has a drag and drop builder. This allows you to create your NPS survey, share it and view the responses all in one place.
Final Thoughts
Net Promoter Score can be a useful metric to help your business understand how your customers are feeling and what changes need to be made. Whilst the formula is simple, having a clear goal, consistent questions, asking at the right time and fairly analysing results will help you get meaningful responses.
Start with one short survey. Take a look at your promoters, passives and detractors. Read through the comments and decide what you want to improve. Compare results over time and look at differences between customer groups.
Most importantly close the loop. Customers should be able to see their opinions are being acted upon thoughtfully. This will make your NPS survey a meaningful part of improving the customer experience and loyalty.
