Net promoter score or NPS is a metric for measuring customer loyalty. The NPS seeks to measure the positive representation of a company by its customers in their social circle. The NPS of a company or brand is measured by asking a sample of customers about their chances of recommending the company or brand to their colleagues or friends. The responses are then recorded on a 0-10 scale with a response of “not at all likely” having score 0 and a response of “extremely likely” having score 10.
The researchers then classify the respondents into three groups on the basis of their scores. Those with scores from 0 to 6 are classified as ‘Detractors’. Respondents with scores 7 to 8 are classified as ‘Passives’ and the respondents with scores of 9 to 10 are classified as ‘Promoters’.
The NPS is then calculated by subtracting the percentage of respondents classified as ‘Detractors’ from the percentage of respondents classified as ‘Promoters’. NPS is used by many companies such as GE, Phillips etc.
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