Calculating your Net Promoter Score - Are You Doing it Correctly?

www.SatrixSolutions.com
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Calculating Your
Net Promoter Score®:
Are You Doing it Correctly?

How likely are you to recommend [Company Name] to a friend or colleague?
Not at all likely Extremely likely
0 1 2 3 4 5 6 7 8 9 10
Detractors
(0-6)
Promoters
(9-10)
Passives
(7-8)
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The Net Promoter Question

Net Promoter Score (NPS) = % of Promoters − % of Detractors
How likely are you to recommend [Company Name] to a friend or colleague?
Not at all likely Extremely likely
0 1 2 3 4 5 6 7 8 9 10
Detractors
(0-6)
Promoters
(9-10)
Passives
(7-8)
Range: -100% to +100%
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A Simple Calculation

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But…which respondent “scores” count
towards your company-level Net Promoter
Score?

5
But…which respondent “scores” count
towards your company-level Net Promoter
Score?

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3 Commonly Adopted Methodologies
1. Counting All Responses
2. Averaging Responses
3. The Waterfall Method

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Counting All Responses

1. Counting All Responses
• This is likely the right
approach for B2C
companies.
• For B2B businesses,
it has its drawbacks
and should be
employed with
caution.
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Counting All Responses -
Drawbacks
• The score can be skewed toward the larger
population of End Users -deemphasizing
Decision Makers
• The Score can also be disproportionately
influenced by customers with more
respondents (5 responses from company A
versus 1 response from company B)
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Of course, the responses from every
respondent are important!

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All feedback should be
considered when
evaluating improvements,
such as:
- product roadmap
- features / functionality
- resource allocation
- service delivery model

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Averaging Responses
(multiple responses from each customer)

2. Averaging Responses
• This approach gathers
responses from Decision
Makers, Influencers, and
End Users to derive an
average score per
customer.
• It also partially mitigates
over-weighting your users
and skewing the score
toward customers with
more respondents.
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However, while each customer engagement only
counts once, End Users may still heavily
influence the score if their population size is
significantly larger than the rest.

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This approach also
requires “rules” of
whether an average of
8.5 rounds to 8 (Passive)
or 9 (Promoter).

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The Waterfall Method

3. The Waterfall Method
• A good approach for
calculating company
level Net Promoter Score
within B2B companies.
• It avoids the various
over-weighting
drawbacks by counting
only one response from
each unique customer
engagement.
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The Waterfall Method- Whose score
counts?
• The person who has the most influence
over whether the customer continues its
engagement with your company – usually
the Decision Maker.
• If they don’t respond, the score from the
next most “important” person is counted -
usually the Influencer.
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It’s important to have contact roles clearly
identified (Decision Maker, Influencer, End
User, etc.) before fielding your survey.

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This will prevent “cherry-
picking” the most
favorable responses to
derive your score and
also enable you to
evaluate loyalty among
the different customer
groups.

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Final Considerations

Establishing the right calculation method is
important.
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So is drilling down, segmenting, and
identifying actionable insights from slicing
and dicing your data.

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Just pick an approach and stick with it -
consistency is critical when analyzing
trending data.

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Lastly, Net Promoter is more than a metric;
it’s a culture-shaping endeavor that, when
adopted, keeps your company focused on:
- listening to customers
- acting on feedback
- educating employees on the key drivers of
customer satisfaction

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Download our Ebook:
Steps for Designing an Effective
Net Promoter Score Survey
http://www.satrixsolutions.com/ebook-steps-for-designing-effective-net-promoter-score-survey-program/

• Customer Satisfaction Survey
• Net Promoter Score® Survey
• Customer Advisory Board
• Sales Win Loss Analysis
About Satrix Solutions
• Employee Engagement Survey
• Employee Net Promoter Score
• Employee Customer Service Training
• And other customized programs
Benefitting from a range of feedback programs and a consultative approach,
companies that partner with Satrix Solutions realize Net Promoter Scores® twice the
B2B average and experience increased retention, referrals, and sales win rates.
The objective insights and recommendations delivered empower business leaders to
outperform the competition and achieve higher valuations in the public and private
markets.
Learn more by visiting: www.SatrixSolutions.com
Customer and Employee Feedback Programs
®Net Promoter, Net Promoter Score and NPS are registered trademarks of Bain & Company,
Inc., Satmetrix Systems, Inc., and Fred Reichheld
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Calculating your Net Promoter Score - Are You Doing it Correctly?

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Calculating your Net Promoter Score - Are You Doing it Correctly?