Net Promoter Score (NPS): How it works and best practices

Net promoter score (NPS) is one of the more ubiquitous metrics for gauging customer satisfaction. It’s used by small businesses, major enterprises, B2B, B2C, and everything in between. 

The NPS score was created by a Bain & Company consultant by the name of Fred Reichheld who introduced the connect in a Harvard Business Review article titled, “The One Number You Need to Grow.”

An overstatement, perhaps, but what business leaders took away from the article was pretty simple:  Customer loyalty is essential to success, but measuring loyalty and how it changes over time is difficult since feedback is typically qualitative and inconsistent. The answer, Reichheld argued, lies in a single-question survey with a scaled response. 

The NPS survey and scoring system 

To measure your NPS, first you’ll need to ask customers the NPS question: ‘How likely is it that you would recommend this company to a friend or colleague?’ 

Customers then score their likeliness on a scale of 0 to 10 where 10 means “extremely likely” and 0 means “not at all likely”. 

This scoring system allows you to group respondents into three categories: 

• Promoters (score 9-10) are satisfied with your product and/or service and willing to advocate for your brand. They tend to spend more, cost less to serve, and refer more new business than other customers. Because they recognize the value you deliver, they’re also less sensitive to price increases.

• Passives (score 7-8) are unlikely to recommend your company or speak negatively about their experience. They cost less to serve than promoters and detractors, but they also deliver less revenue. While passives are sufficiently satisfied, they remain open to competitive offers.

• Detractors (score 1-6) are customers who respond with a 6 or lower. Because they’re unhappy with your product and/or your service, they’re likely to discourage others from becoming customers. Many detractors have had negative experiences, resulting in ongoing issues. For example, detractors resist price increases and complain more frequently, increasing service costs. They’re also more likely to churn.

How to calculate NPS

Individual NPS ratings can help you identify loyal and high-risk customers for proactive outreach. You can also use these ratings to calculate an overall score for your business so you can set benchmarks around customer satisfaction, measure shifts in performance over time, and track the performance of retention campaigns and initiatives.  

To do this, calculate the percentage split between promoters, passives, and detractors. Then use the following formula:

% PROMOTERS - % DETRACTORS = NPS

Here’s an example:

• Total NPS survey responses: 500

  • Detractors: 50 (10%)

  • Passives: 125 (25%)

  • Promoters: 325 (65%)

To calculate your NPS score, you would subtract the percentage of detractors from the percentage of promoters and display the total as an integer rather than a percentage: 

• 65% - 10% = 55%

  • NPS score: 55

You can manually calculate this in a spreadsheet after an NPS survey drive is complete, but using a tool (like Ortto) to manage the NPS process from end to end is far easier and more accurate. Ortto includes tools that help you create and distribute your NPS survey, send follow-up communications to customers, and report on your NPS over time.

Best practices for creating and distributing an NPS survey

There are a few components to consider with NPS — in this section, we’ll break it down to share best practices for creating and distributing your survey to customers. 

• Survey question and style 

The survey itself should be one, simple question along the lines of, ‘How likely are you to recommend [Business name] to a friend or colleague?’ with a score of 0-10, 10 being extremely likely.

While your survey popup, email, or SMS should be as simple as possible, it’s also important that it accurately represents your brand. Use your fonts, colors, and potentially a simple graphic for polish. 

Tempting as it may be to add more questions or CTAs while you have your customer's attention, you are more likely to generate a large volume of truthful and accurate responses with this simple, proven, one-question survey. 

Popup

NPS survey popup

Use template

• Distribution and frequency

Like anything in marketing, generating results is about reaching your customer at the right time, in the right place. Depending on your business type, this could mean you send the survey every time they use your service (for example, Uber or DoorDash do this), after a user has been engaging with your app for at least 30 days, or 7 days after an appointment takes place or purchase is delivered. 

Most NPS tools allow you to send surveys via email, SMS, or popups. For apps, an in-app popup after a certain period of usage or engagement level is typically preferred. If your business offers physical products or services, sending an email or SMS based on the customer’s preferences is a good starting place. 

Since customer relationships evolve over time, NPS is not a one-and-done activity. Once the initial survey is responded to (or dismissed), you can show or send it again after enough time has elapsed — every 90 days to 180 days will give you enough regular feedback without causing fatigue. 

• Real-time submission tracking

Submissions to your NPS survey will be tracked in the software you’re using, and if your customer data is unified in a single business analytics tool like Ortto, you can set up additional reports that tell you how NPS changes over time and impacts other business metrics. These reports will help you identify trends and generate insights.

It's equally important to keep an eye on responses in real-time to give your support, success, or sales teams a chance to take quick action to follow up with detractors or thank promoters personally.

This is where an automated workflow comes in. Here at Ortto, we use our Slack integration to send alerts about NPS survey submissions to a specific channel. This means we see submissions in real-time, so relevant teams can act when needed and we can celebrate our 9s and 10s together. 

Following up with your NPS customers

There may be instances where customer outreach is direct and manual, but most NPS submissions can be managed with an automated journey that uses NPS survey submission and response type as a trigger for an email follow-up.

For example:

• Promoters: Thank promoters for their positive review, and encourage them to leave a review on a relevant third-party website or provide an incentive for them to refer a friend or colleague. 

• Detractors: Send a personalized email asking for more feedback on where you fell short so you can ensure their problem is fixed, and fast. 

• Passives: You can choose whether to follow up with Passives to thank them for the feedback, ask for more information, or offer some help.

In all three cases, the NPS survey should be shown again after a period of 90 or 180 days. This allows you to monitor shifts and see how your response to detractors or passives impacted their score.

Benchmarking your net promoter score

In 2024, Retently’s annual NPS benchmark reports showed that average NPS scores can be vastly different depending on the industry you’re in. For example, construction sits at an average of 37, whereas consulting’s average is in the high 70s. In B2C, insurance has a high average score of 80, while internet software and services sits at just 16. 

Image Source: Retently, 2024

If you’re new to NPS, industry benchmarks can be a helpful place to start, but it’s always best to set your own benchmark. As you can see from the averages above, different business types can have wildly different averages, and the same applies within industries. 

Once you’ve been measuring NPS for a few months, you should be able to identify a benchmark and create goals around it. You can then use this to track how changes to customer service offerings, retention campaigns, new offerings, and other initiatives impact your score. 

The final word

NPS has been the source of much debate and has its very own promoters and detractors. It may not be a perfect system, but it is powerful. It gives businesses a way to quantify, benchmark, and track customer satisfaction over time. And when teams come together to proactively improve the score with follow-ups, retention campaigns, and support initiatives, you can positively impact revenue.