{"schema":"askedwell-answer-v1","url":"https://askedwell.com/pages/what-is/net-promoter-score","question":"What is Net Promoter Score (NPS)?","short_answer":"NPS is a single-question survey measuring customer loyalty: \"On a 0-10 scale, how likely are you to recommend us to a friend?\" Promoters (9-10) minus Detractors (0-6) = NPS, ranging −100 to +100. Industry benchmarks: +30 is good, +50 excellent, +70 best-in-class. NPS predicts retention better than satisfaction surveys.","long_answer":"**The single-question survey**\n\nNPS (Net Promoter Score) was created by Fred Reichheld at Bain & Company in 2003 (\"The One Number You Need to Grow\"). The single question:\n\n> \"On a scale of 0 to 10, how likely are you to recommend [Company / Product] to a friend or colleague?\"\n\nResponses split into three categories:\n\n| Category | Score range | Behavior |\n|---|---|---|\n| **Promoters** | 9-10 | Loyal advocates; word-of-mouth source |\n| **Passives** | 7-8 | Satisfied but not enthusiastic; vulnerable to competitors |\n| **Detractors** | 0-6 | Unhappy; will speak negatively |\n\n**The formula:**\n\n```\nNPS = % Promoters − % Detractors\n\n(Passives are NOT included; they're counted in the denominator but contribute 0)\n```\n\nExample: 50% Promoters, 30% Passives, 20% Detractors → NPS = 50 − 20 = +30.\n\n**NPS range: −100 to +100**\n\n- −100: every customer is a Detractor (extreme)\n- 0: equal Promoters and Detractors\n- +100: every customer is a Promoter (extreme)\n\n**Industry benchmarks (calibrated against 2024 published data)**\n\n| NPS | Verdict | Examples |\n|---|---|---|\n| <0 | Severe customer dissatisfaction | Many telecoms, ISPs, airlines |\n| 0-20 | Below average | Many traditional industries |\n| 20-30 | Average | Most consumer products |\n| **30-50** | **Good** | **Healthy SaaS target** |\n| 50-70 | Excellent | Apple, Tesla, well-loved consumer brands |\n| **70-80+** | **Best-in-class** | **Netflix, Amazon, Costco at peak; rare** |\n\nNPS varies significantly by industry. B2B SaaS averages NPS 30. Consumer SaaS averages 25. Healthcare averages 9. Airlines often score below 0.\n\n**Why NPS predicts retention better than satisfaction**\n\nCustomer Satisfaction (CSAT) asks \"How satisfied are you?\" — answered in the moment. Satisfaction is transient; loyalty is durable.\n\nNPS asks \"Would you recommend?\" — answered with stakes (your reputation among friends). The latter correlates strongly with:\n- Repeat purchase / renewal probability\n- Word-of-mouth referrals (which drive low-CAC acquisition)\n- Expansion revenue (Promoters upgrade more)\n- Reduced support costs (Promoters use product as designed)\n\nResearch (Bain, multiple replications): NPS is 2-3× more predictive of retention than CSAT.\n\n**How to measure NPS correctly**\n\n| Best practice | Why |\n|---|---|\n| Survey at-rest customers (not just trial users) | Trial users haven't formed lasting opinion |\n| Wait until customer has used product 30+ days | Earlier responses are anchored to onboarding experience, not steady-state |\n| Send to broad sample, not selected enthusiasts | Selection bias destroys signal |\n| Ask follow-up: \"Why?\" | Open-ended response provides actionable insights |\n| Re-survey same customers quarterly | Track movement over time, not just snapshots |\n| Don't include in dashboards as headline metric | NPS as KPI creates gaming behavior |\n\n**The \"NPS theater\" problem**\n\nMany companies turn NPS into a vanity metric:\n- Asking only customers who recently had positive experiences\n- Surveying after positive moments (e.g., after a save by support)\n- Excluding response categories (\"only counting Promoters\")\n- Adjusting weighting until the number looks good\n- Comparing NPS across products with different sampling\n\nThe resulting \"NPS 75!\" looks great but doesn't reflect actual customer sentiment. Honest NPS:\n- Random sample from entire customer base\n- Quarterly cadence\n- Methodology consistent across reporting periods\n- \"Why?\" follow-up included\n\n**NPS variations**\n\n| Variant | What it measures |\n|---|---|\n| Relationship NPS | Periodic NPS (quarterly survey to all customers) — measures overall sentiment |\n| Transactional NPS | Post-event NPS (after support ticket, after purchase) — measures specific touchpoint |\n| Employee NPS (eNPS) | Same question to employees about workplace |\n\nMost B2B SaaS report both relationship + transactional NPS separately.\n\n**Common NPS mistakes**\n\n- **Comparing NPS across industries** — benchmarks vary; SaaS 30 ≠ Telecom 30\n- **Sampling bias** — only surveying engaged users\n- **Ignoring Passives** — they're 30-50% of most customer bases; the 7-8 range is the swing vote\n- **Treating NPS as the goal** — it's a metric, not an objective; the goal is retention + growth\n- **Single-survey thinking** — NPS is a trend, not a snapshot; track quarterly\n\n**How to improve NPS**\n\n1. **Address Detractor root causes** — open-ended \"Why?\" responses reveal recurring complaints\n2. **Convert Passives → Promoters** — these are the most-leverage segment; satisfied but not loyal\n3. **Build referral mechanisms** — make it easy for Promoters to refer (refer-a-friend program, share buttons)\n4. **Reduce friction in obvious pain points** — checkout, support, billing\n5. **Communicate proactively** — keep customers informed of improvements + new features\n\n**Cross-reference:** see /pages/what-is/customer-acquisition-cost + /pages/what-is/lifetime-value + /pages/what-is/churn-rate.","duration_iso":"PT0M","ranges":[{"condition":"NPS scale","duration":"−100 to +100"},{"condition":"Average NPS (most industries)","duration":"20-30"},{"condition":"Good NPS (SaaS target)","duration":"30-50"},{"condition":"Excellent NPS","duration":"50-70"},{"condition":"Best-in-class NPS","duration":"70+"}],"variables":[{"name":"Industry variance","effect":"NPS varies 30+ points across industries — SaaS averages 30, telecom often negative. Always compare within industry"},{"name":"Sampling methodology","effect":"Selection bias (only surveying engaged) inflates NPS by 15-30 points. Random sample only"},{"name":"Customer tenure","effect":"New customers (1-3 mo) score differently than tenured (12+ mo); always measure across cohorts"},{"name":"Cadence","effect":"Single-snapshot NPS misleading; quarterly trend reveals actual sentiment movement"}],"sources":[{"label":"Fred Reichheld, \"The One Number You Need to Grow\"","tier":1,"url":"https://hbr.org/2003/12/the-one-number-you-need-to-grow","note":"Harvard Business Review 2003 — original NPS methodology paper"},{"label":"Bain & Company NPS research","tier":1,"url":"https://www.bain.com/insights/topics/net-promoter-system/","note":"Continued NPS research; correlation with retention + growth metrics"},{"label":"Satmetrix NPS Benchmarks Study","tier":2,"note":"Industry-by-industry NPS benchmarks; published annually"},{"label":"Frederick Reichheld, \"The Ultimate Question 2.0\"","tier":2,"note":"Updated NPS methodology + implementation guidance"},{"label":"Customer Gauge Industry NPS Benchmarks 2024","tier":2,"note":"Annual cross-industry NPS data — published consensus benchmarks"}],"faq":[{"question":"What's a \"good\" NPS for SaaS?","answer":"For B2B SaaS: +30 is good, +50 excellent, +70 best-in-class. Industry-leading SaaS companies (Atlassian, Slack at peak, Salesforce in segments) hit 50-70. For consumer SaaS: targets are slightly lower (Netflix peaked at +65; most consumer products at 30-50). Compare to your industry, not absolute number. NPS of 25 in SaaS is below average; NPS of 25 in healthcare is excellent."},{"question":"How often should I measure NPS?","answer":"Quarterly is canonical for Relationship NPS. Track trend over time, not absolute number. Transactional NPS (post-support ticket, post-purchase) can be measured per-event. Avoid monthly NPS — too noisy, creates response fatigue, often manipulated by Q4-push behavior. Reasonable cadence: quarterly relationship + continuous transactional + annual deep-dive open-ended."},{"question":"Should I include NPS in employee KPIs?","answer":"No — NPS as employee KPI creates gaming behavior. Customer support teams asked to maximize NPS will: (1) Only survey happy customers. (2) Cherry-pick timing. (3) Skip difficult customers. The metric becomes optimized for itself, not for actual customer loyalty. Better: include NPS in board reports + customer success leadership review; don't weight it heavily for line-staff compensation."},{"question":"What's the difference between NPS and CSAT?","answer":"CSAT (Customer Satisfaction) measures momentary happiness (\"Were you satisfied with this interaction?\" 1-5 scale). NPS measures durable loyalty (\"Would you recommend us to a friend?\" 0-10 scale). CSAT is transactional and immediate; NPS is relationship and predictive. CSAT can be high in moment but customer still churns; NPS correlates 2-3× better with actual retention. Use CSAT for service operations; use NPS for strategic loyalty measurement."}],"keywords":["Net Promoter Score","NPS definition","what is NPS","NPS calculation","NPS benchmark","customer loyalty metric","how to measure NPS","NPS vs CSAT"],"category":"business","date_published":"2026-05-27","date_modified":"2026-05-27","license":"CC-BY-4.0","attribution":"https://askedwell.com"}