Most companies use NPS as a metric to know better about their customers. If you are one of these brands, you must be thinking:
- What is a good net promoter score?
- How is your company faring according to the industry benchmarks?
- And how to benchmark your net promoter score that will improve customer satisfaction?
All these questions will get covered in this article, and you will know how to get the most out of your net promoter score.
What is NPS?
Net promoter score (NPS) calculates customer loyalty score by asking them one question” On a scale of 0 to 10, how likely are you to recommend our company/product to friends and family?”
The score ranges from -100 to 100. It measures the willingness of customers to recommend a company. Companies looking to increase their NPS score help them get more enthusiastic customers. The logic of NPS is to convert detractors into promoters.
What is a good NPS?
As we have said earlier, the score ranges from -100 to 100. A good, neutral, or bad NPS score varies according to the industry. The formula for Net Promoter Score is = %Promoters – %, Detractors.
Some industries count any score above 0 good. It shows customer satisfaction and loyalty.
If your NPS score is above 30, you are good to go.
Generally, an NPS score over 60 is considered good for any industry.
‘Absolute’ and ‘relative’ in NPS
To know what is a good score in NPS is, let’s take a look at two ways of thinking about your NPS:
- Absolute NPS: It uses your score as a ‘good’ score against all the industries.
- Relative NPS: It compares your score against other companies within your industry. You can check how your brand is performing against other brands within your industry. It will indicate your customer satisfaction.
The goal for brands is to get 100? The answer is both yes and no.
Yes, because you want your brand to move in a positive direction. You want to turn detractors into promoters. It is achievable only when you are moving your NPS score towards 100. Going near the 100 NPS score will automatically improve customer satisfaction.
No, because it is difficult to hold on to the 100 scores. A 100 score means that all your customers are satisfied, and even the industry and big brands with loyal customers don’t have a 100 score. I will explain more of this in the below section.
NPS benchmarks by industries
A good net promoter score differs for every industry. Therefore, this section will cover the representation of NPS benchmarks by industries.
The absolute method involves comparing the score to an agreed industry standard among all the industries.
Here’s a breakdown that can help you understand how well your business is doing with the absolute method:
- – 100-0: These customers are unhappy with your company and might spread the negative word about your brand.
- 1-30: This is an ok range, meaning you have slight promoters for your business. If your brand is in this range, you have a lot of scopes to improve.
- 31-50: It is where most of the companies are. They are ready to promote your product to friends/family.
- 50-70: A company in this range is excelling in the customer experience. They have a larger than average group of promoters who share their experiences.
- 71-100: This is where every company wants to be. It is tough to retain this NPS score. A company falling in this range gets considered to be the best.
The following is the list of significant industries with their NPS scores as a benchmark:
|Average Net Promoter Score by Industry||Number|
|Digital Marketing Agencies||57|
|Rideshare & Food Delivery||46|
|Cloud & Hosting||45|
|Technology & Services||39|
|Internet software & Services||39|
|Cell Phone Service||34|
|Software & Applications||30|
|Communications & Media||24|
|Satellite/Cable TV Services||-2|
|Internet Service Providers||-3|
In the relative method, you compare the net promoter score with the average scores within your industry and against your competitors. This method helps in evaluating yourself as an individual brand in the marketplace.
So, let’s explore some of the highest and lowest average Net Promoter Scores for a variety of industries:
|Brands||Net Promoter Score|
|Harvard Business School (Education)||41|
|American Express (Finance)||55|
|JP Morgan (Finance)||8|
|Johnson & Johnson (Healthcare)||36|
|Havas Worldwide (Marketing)||25|
|Accenture (Professional Services)||15|
|Home Depot (Retail)||-5|
Ways to benchmark your net promoter score to improve customer satisfaction?
Now you have an idea about the NPS industry benchmarks. It’s time to make use of them. Here are some ways to benchmark your NPS.
Implement an NPS survey.
It’s time to run your own NPS survey. First, ensure you are following NPS survey best practices. Here are some pointers to keep in mind:
- Surveys should be logical and concise.
- Reply to customer feedback.
- Share NPS surveys via your preferred channels.
- Ask open-ended questions to your audience.
It is advisable to run your customer surveys with NPS software. The survey software allows you to execute the customer experience campaign. You’ll be able to take maximum leverage out of NPS benchmarks.
Work on your NPS over time.
NPS scores cannot improve overnight. The process takes time and a strategy. Once you reach your goal, the progress should not stop there. Do R&D and try to streamline it further. Collecting feedback from other teams in your business is a way to go. It will help you to gain a better perspective.
Regular follow-up with unhappy customers.
Engaging with unhappy customers is the best way to improve your NPS score. Have a dedicated team to call them up and discuss their experience. In addition, it provides a chance to:
- Build relationships.
- Understand what needs fixing.
- Empathize with your customer base
NPS is a metric allowing brands to gauge whether they are performing or not. Knowing the industry benchmark scores will enable your brand to move in the right direction. In addition, implementing regular surveys with your customers combined with the above steps can help you to improve the NPS score.
Author: Kaumudi Tiwari
Bio: Experienced Content Writer and Digital Strategist, been in the IT Industry for the last 5+ Years. Associated with the Zonka Feedback. Passionate about writing customer experience, customer satisfaction, customer feedback, and net promoter score.