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KPI Record Indicator type Unit type
sK1303 smartKPI %
Name

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% Net promoter score
Definition and variations
Definition
Measures the net difference between promoters and detractors, of all customers that express an attitude. Note: Net Promoter, Net Promoter Score and NPS® are registered trademarks of Fred Reichheld, Bain & Company and Satmetrix.
Variations
% Promoter score (TM)
% NPS®
Related KPIs
% Customer satisfaction with new products and services
Tags
portfolio, customers
Calculation
Subordinate measures used for calculation
A = # Promoters
B = # Detractors
C = # Customers
Calculation formula Formula type Trend is good when
(A/C)*100-(B/C)*100 Rate Increasing
   

Focus
Purpose
To monitor the level of customer satisfaction by evaluating the extent at which customers act as brand ambassadors.
BSC perspective Measurement focus Impact stage
Customer Satisfaction Outcome
Indicator focus Measurment type Level
Leading Quantitative Strategic
Data profile
Data capture period Standard reporting frequency Data integrity
Spot Quarterly Medium
Automation fit Limitations
Not recommended Being based on customer surveys, results can be altered by subjectivity of the respondents or incentives given by the company to stimulate responses.
   
Targets
Benchmarking fit Notes
Suitable
Benchmarking is promoted by Satmetrix, a co-developer of net promoter and benchmark figures are available on their online community: http://www.netpromoter.com/netpromoter_community/community/npsbenchmarks?view=tags&tags=benchmark Some argue that benchmarking might not be suitable, as companies may use different-point scales (the standard in 11, but some use 10, some 5 and so on). Also, some companies may resort to incentives so as to increase the rate of responses.
   
Threshold exemple
Red: <50% Yellow: 50-70% Green: >70%
Analysis and resources
Overall notes
Although it is considered very simple and easy to compute, its relevance for decision-making can be quite limited, as the net percentage of promoters can only show whether there are more promoters than detractors, or the other way. It cannot assess their influence on company / product image or success, as even where detractors may be less (thus being a positive net promoter score), their activity may be more intense, the net effect of their activity being negative for the company.
Additional resources
http://www.theultimatequestion.com/theultimatequestion/measuring_netpromoter.asp?groupcode=2

2011 Net Promoter benchmarks charts for Europe
http://www.netpromoter.com/netpromoter_community/docs/DOC-1190

Net Promoter 2011 U.S. Benchmark Charts
http://www.netpromoter.com/netpromoter_community/docs/DOC-1184
References
1. Businessweek.com (2006), "Would You Recommend Us?
That simple query to customers is shaking up planning and executive pay", available at: http://www.businessweek.com/magazine/content/06_05/b3969090.htm
2. Joshi, P. & Chaudhari, T., "Net Promoter Score® Lean Six Sigma way-An Impetus for Growth at General Electric", available at:
http://sixsigma.scmhrd.edu/articles/NPS%20Paper2007.pdf
3. Satmetrix (2004), "The Power Behind a Single Number
Growing Your Business with Net Promoter®", Satmetrix Systems®, Inc. available at:
http://www.csb.uncw.edu/people/howe/Classes/MBA541/CLASS%20OF%202009/NetPromoterWPfinal.pdf

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