What is Net Promoter Score (NPS) and what impact does AI have on your results?

Natalie Smithson
AI enthusiast | Tea addict | Focused on using AI assistants to win the working week

What is NPS?

Net Promoter Score (NPS) is a metric used to measure customer loyalty and satisfaction based on the question: “How likely are you to recommend our product or service to a friend?” This shows how customers feel about your brand or business, ranging from detractors (dissatisfied customers) to promoters (loyal customers).

NPS helps you understand your customer base better, identify areas for improvement, and build stronger relationships with them. A high NPS indicates customers are more likely to advocate for your brand or product, potentially leading to increased business growth and success.

How do you calculate NPS?

To calculate NPS, you’ll need to segment your survey respondents into three categories:

  1. Promoters (rating 9-10) These are enthusiastic, loyal, and satisfied customers who rate the company, product, or service at a 9 or 10. They are likely to continue buying and using your products or service and are likely to recommend your company to others. These individuals provide positive word-of-mouth publicity and can drive growth.
  2. Passives (rating 7-8) These are customers who are neutral or indifferent towards your company. They might be satisfied with your product or service, but they aren’t as enthusiastic as promoters. These customers aren’t likely to spread any negative message about your company, but they’re also not vocal advocates. If a competitor offers a better product, service, or price, passives are likely to switch.
  3. Detractors (rating 0-6) These are unhappy customers who are not pleased with your product, service, or the overall customer experience, and they may potentially damage your brand and impede growth through negative word-of-mouth. Paying attention to detractors helps businesses identify areas of improvement and implement measures to improve customer satisfaction.

Subtract the percentage of detractors from the percentage of promoters to get the NPS score.

For example, if 70% are promoters and 15% are detractors, the NPS would be 70 – 15 = 55%.

This simple calculation allows you to gauge customer satisfaction easily and effectively using feedback to allow for data-driven decision making to enhance customer experiences.

Why does NPS matter?

NPS acts as a key indicator for your teams, guiding decisions on retention and growth. It reveals how likely customers are to recommend your brand, reflecting customer loyalty and satisfaction levels. By tracking NPS over time, you can identify trends, address pain points, and focus on initiatives that drive customer engagement and loyalty.

A high NPS signifies not only a loyal customer base and improved customer retention, but also higher profitability for sustainable business success.

What is a good NPS benchmark?

  • NPS +72 and above is generally considered excellent, reflecting a high degree of customer loyalty and satisfaction.
  • Scores between +44 and +72 are good, showing a satisfied customer base exists and with potential for growth.
  • The average NPS is +32 according to SurveyMonkey’s study of 150,000 organisations.
  • Scores below this show there are areas for improvement and signal the need for strategic changes to enhance customer experiences.

Striving for a high NPS not only nurtures customer loyalty but also fuels business growth by encouraging positive word-of-mouth referrals and fostering long-term customer relationships.

Rethinking NPS strategies to suit the age of AI

Instant, online communication with customers in their chosen language, on-the-go from wherever they are gives you a consistent opportunity to gather NPS data. Using an AI assistant, you can track your score continuously and in real time.

When you’re spending less time acquiring customer feedback by sending out manual surveys and then collating the information you gather, you have more time to focus on taking action on everything you learn and improving the services will boost your NPS. For Barking & Dagenham Council, customer satisfaction went up 67% just six months after introducing a next-generation AI assistant to their team.

“An AI chatbot allows you to ask every customer at the end of a chat, right there in the moment, if they would recommend your product or service ― you can even use emojis to help them quickly select a score or emotion from 1-10. This helps encourage more customers to give you the valuable feedback you need to make important future decisions for your business because they only need click one button, which takes just a second of their time. The downside of using NPS alone is that you’re lacking qualitative feedback to understand why a customer has given you that score, but an AI assistant can ask a follow-up question to find out from the customer, ‘What’s the reason for giving that score?’ and give you expanded feedback, in their own words, and on any element of your product or service that matters most to them. The fact the feedback is conversational allows it to be more natural and literally ‘straight from the horses mouth’. ~ Abbie Heslop, Head of Customer Journey at EBI.AI

How to use AI Studio to collect NPS data

Using our advanced platform, AI Studio, it’s easy to set up question and answer sequences ― we call them Flows, and add in automated questions to gather feedback.

Video shows a flow for questions about which laptop to use for gaming

Creating your own NPS flow in AI Studio

  1. Sign up for or log in to AI Studio
  2. Go to the Content tab and check you’re on Flows
  3. Create a new flow called ‘Ask NPS score’
  4. Add a Question: ‘How likely are you to recommend our product or service to a friend?’
  5. Add Valid options 1-10
  6. Click Show options to user (so they can quickly choose a response)
  7. Hit Publish

You can go to any of your existing Flows and select Link to flow to add this NPS request to the bottom of the conversation. Or if you want to filter your requests and only ask about NPS at the end of any flow where the customer has given positive feedback, you’d go to the Universal content tab and add it to the flow called Positive feedback acknowledgment.

Why it makes sense to calculate NPS using an AI assistant

There are many benefits to using an AI assistant to manage NPS:

  • AI assistants can handle an extraordinarily vast amount of data, so it doesn’t matter how many tens of thousands of customers you have or how many millions of transactions you handle, an AI assistant can easily cope with data at scale
  • AI assistants are incredibly easy to set up and manage if you choose the right self-serve platform ― you don’t need any technical know-how or expertise (an experienced AI provider can even supervise or do it all for you)
  • You can use just one AI assistant across multiple channels, from your website or a mobile app to social media channels and smart speakers, but your data sits in one central place for you to analyse all at once
  • Information is being added to your pool of data 24/7, since your AI assistant is always on
  • Data is organised for you; you don’t need to set up spreadsheets or sums or manual automations, all the information you need is simply presented to you on a dashboard
  • No human agent, no matter how experienced or smart they are can handle data at the speed of AI, so calculations are made faster than lightning, which saves your teams the time
  • There’s no risk of human error
  • You can control when your AI assistant does or doesn’t ask customers for their score, so you don’t get unnecessary data that might skew your results

An AI assistant makes it effortless to get a full overview of all your customer data and metrics!

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FAQs

How can a business use NPS to improve customer satisfaction?

Businesses can use NPS to better understand customer sentiments, identify areas for enhancement, and establish stronger relationships which ultimately lead to improved customer satisfaction and loyalty. See also: Customer satisfaction score.

What are the benefits of tracking NPS over time?

By monitoring NPS trends, businesses can pinpoint evolving customer preferences, address emerging issues, and focus on initiatives that enhance customer engagement and overall satisfaction to help meet key customer-focused goals.

Apart from customer service, in what areas can NPS be beneficial?

NPS can provide insights for product development, marketing strategies, and overall business growth planning, offering a comprehensive view of customer sentiment across various touchpoints to help avoid customer churn.

Is a high NPS score a guarantee of business success?

While a high NPS indicates satisfied customers and potential growth opportunities, it’s essential to complement this with strategic actions that address customer feedback, ensuring a sustainable and successful business model. See also: Customer satisfaction scores (CSAT).