What Is a Good NPS Score Range? Learn the Science Behind the Number
In this article, you'll explore the range of the NPS score and learn what a good NPS score is. You’ll also discover how continuous NPS score measurement and monitoring can help reduce churn and improve retention.
Table of contents:
Understanding the NPS score and what it measures
Before answering the question of what a good Net Promoter Score (NPS) range is, we’ll focus on what it measures. NPS gauges the overall customer loyalty to a brand. It does it by measuring the likelihood of customers recommending a brand’s products or services to others (usually friends and colleagues).
- Unlike the CSAT score, the NPS score does not measure customer satisfaction with a specific interaction but gauges overall satisfaction.
- Unlike the CES score, the NPS score doesn't evaluate the perceived level of effort involved in an interaction between a customer and a company.
Why and how you can leverage the NPS score for your business's growth
You can identify churn risks before customers switch to another product by monitoring and tracking the NPS score dynamics. If the NPS score for Customer X is low, they are unwilling to recommend your company’s products or services to their peers, friends, and colleagues. Such customers may very well be on the verge of switching to someone else.
Armed with this intelligence, you and your customer success team can take measures to figure out what exactly needs improvement. Think of NPS as your early-waring radar for all churn-related matters.
How to Calculate NPS Score?
Using NPS Survey Software, you can collect individual responses from your customers to the question of how likely they are to recommend your company to their friends and colleagues. Usually, a scale of one (1) to ten (10) is used as response options, where:
- One (1) stands for “not at all likely”
- Ten (10 ) stands for "extremely likely"
The process of calculating the NPS score is straightforward. Yet, it requires several steps, such as calculating the percentage of promoters and detractors (see next section). And it ranges from -100 to +100.
The NPS Score formula:
To calculate the NPS score, we’ll need the percentages of promoters and detractors (see NPS formula below).
- Promoters — are those who responded with 9 or 10
- Detractors — are those who responded with 0 to 6
- Passives — are those who responded with 7 or 8
Sample NPS calculation
Let’s imagine you received the following 150 responses:
- 10 - 70 responses
- 9 - 40 responses
- 8 - 10 responses
- 7 - 10 responses
- 6 - 10 responses
- 0-5 - 10 responses
Using the NPS score formula, let’s calculate the % of promoters and detractors first:
Once we’ve calculated the % of promoters and detractors, we can calculate our NPS score:
What is Considered a Good NPS Score Range?
The answer to the question of what constitutes a good NPS score can vary based on the industry, but here's a broad benchmark provided by Bain & Company, creators of the NPS score.
Please take the above NPS score ranges with a grain of salt. These are loosely agreed-upon numbers that may not reflect the realities of your industry or business model. To determine whether your NPS score is any good, consider connecting with peers from your industry or studying industry-level research with average NPS scores.
- Above 50% Is World-Class: Your customer loyalty is unparalleled. Keep doing what you’re doing.
- Between 20 and 50% Is Great: You're doing well, with most customers willing to vouch for your brand. However, there's still room for growth, as you may be experiencing some churn.
- Between 0 and 20 Is OK, But You Can Do Better: While you have a loyal customer base, your churn rate is somewhat of an issue. You need to figure out the one thing you can improve to break beyond 20%.
- Between -100 and 0% — Needs Improvement: Your business requires significant introspection. Consider using NPS surveys to uncover why your customers are generally dissatisfied with your business. Act quickly, as your level of churn is likely killing your business.
Now that You Know How Good Your NPS Score Is, What’s Next?
Understanding customer satisfaction and being able to pull the levers to improve it is essential for the success of an organization. With NPS survey tools, you can create NPS surveys, send them to your customer base, measure customer loyalty, and track how it changes over time.