Importance of Net Promoter Score for Businesses
Businesses stand on happy and satisfied customers so finding ways to measure their satisfaction is crucial. That’s exactly how net promoter score (NPS) can help you. With the information that net promoter score can give you, you can figure out what you need to improve, and how you can maintain high standards.
Benefits of Using NPS for Measuring Customer Loyalty
Numerous other options can help you to measure customer loyalty, but NPS is very frequently used for a couple of reasons. It’s a very straightforward metric that is very simple to use and understand. NPS makes it possible to accurately measure customer loyalty and satisfaction.
Also, NPS provides you with a full picture of how customer generally views your brand, and it’s related to their whole experience and not just one occasion. You can also understand how well you are performing against your competitors. It’s an easy, cost-effective solution that can give you good direction and help you understand what you need to change or improve.
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Interpretation of the NPS Scores
NPS scores can be interpreted differently based on different aspects, but generally, some numbers give you a very clear indication of what’s going on. If the net promoter score is below 0, it means that you have to sort out lots of issues in your industry. When it’s between 0-30 it means that you are in a good position but there’s still room for improvement.
If the score is above 30, it’s a good indication that you have mostly happier customers than unhappy ones and you are performing well. When the NPS score is above 70, it means that you have numerous happy customers and they are more than happy to be your brand’s ambassadors.
NPS for Different Industries
A good net promoter score is different for different industries. For example, companies that are related to the consultancy sector have higher than average NPS, because they have longer and more frequent interactions with their customers.
But when it comes to health care, or anything medicine related it could be lower, because of the mindset that the patients could have, it’s just not a pleasant experience for many to visit doctors and that’s why. So first of all, you have to understand what’s the average net promoter score in your industry and then identify the actions that you’ll need to improve customer experience.
Compare NPS Scores Within a Region
NPS scores are different for different industries but it’s also important to see what’s happening in certain geographical areas as well. Cultural differences decide a lot for the NPS score. For example, to speak generally Americans more frequently rate companies higher, while there’s a more different situation in Europe.
If a satisfied American customer is willing to score you with 10, a European customer will give you 8. While in Japan it’s simply poor etiquette to rate any business too high or too low, no matter how well they are performing.
NPS for Famous Brands
Competing against the net promoter score of famous brands would be interesting, but it’s important to not lose focus on your industry and first make sure that you’ll perform better than your competitors whom you are dealing with more frequently. Also, some of the famous brands have a higher net promoter score because they have a well-known company name or the niche market that they are operating in and it might not be related to customer satisfaction at all. Generally, the numbers are high here.
NPS for B2C Businesses
Net promoter scores for B2C businesses always highlight important factors related to customer satisfaction. Those types of businesses always have a bigger customer base, so can get more valuable information as well. The average net promoter score for B2C ranges between 24 and 57. 47 is already a good score. But you have to always follow industry standards and news because those results always change each year.
NPS for SaaS
A good NPS score for SaaS (Software as a Service) is approximately more than 31. A good range varies between 31 and 41, but those numbers change every year. Scoring above 30 would be good, but being close to 40 or overcoming that number would mean that your company can be distinguished from many others.
Many other industries have completely different scores, so before you come up with conclusions regarding your customer loyalty and satisfaction, look through your industry and geographical area one more time.
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