My latest article on NPS sparkled some interesting conversations on this metric that I believe are worth sharing:
From a strictly mathematical point of view, we should use the percentage sign because when we subtract two percentage numbers, the result must be represented as a percentage or as a fraction number. For example, if we have 50% promoters and 30% detractors, the NPS calculation will be 50% – 30% = 0.5 – 0.3 = 0.2. That is, the NPS is 0.2 or 20%. From a mathematical point of view, saying that the NPS is 20 is not correct, because 0.5 – 0.3 is not equal to 20, is equal to 0.2, or 20%.
However, a bit of caution is required. If your NPS is 20%, that doesn’t necessarily mean that 20% of the interviewed customers are promoters. It means that at least 20% are promoters. It can be:
The same goes for a negative NPS. A -16% NPS means that at least 16% of the interviewed customers are detractors. It can be:
In the article The One Number You Need to Grow by Fred Reichheld where the concept of net promoters and its correlation to business growth was first presented in December 2003, all charts show net promoters as percentages, not integers.
Most recently many NPS reports from Bain & Company, Satmetrix Systems, and even from Fred Reichheld, who conjointly own the NPS trademark, present the metric as integers and not as percentages.
So I believe we can safely say that it doesn’t matter if we use or don’t use a % sign when presenting the NPS number. However, regardless of whether or not we use the % symbol, what really matters the most is understanding why promoters, detractors, and neutrals gave us this rating.
During my coaching sessions, one metric my coachees normally bring to discuss is NPS. How to measure? How to manage it? It is common to see targets and KRs set for NPS, like “we will have an NPS of 20 (or 20%) by the end of the quarter”. I advise against using NPS as a target because:
That doesn’t mean we should not measure NPS. We should because the act of measuring and discussing it provides many useful insights to help us improve our product.
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