The NPS is a market research metric that is based on a single survey question asking respondents to rate the likelihood that they would recommend a company, product, or a service to a friend or colleague. NPS is commonly interpreted and used as a measure of customer loyalty. NPS scores vary substantially between industries.

NPS was developed because many customer surveys are complex and expensive and we needed a metric that was simple and based on a single simple question. The origins of NPS go back to a 2003 Harvard Business Review article by Reichheld titled “The Only Number You Need to Grow”.

The NPS assumes a subdivision of respondents into “promoters” who provide ratings of 9 or 10, “passives” who provide ratings of 7 or 8, and “detractors” who provide ratings of 6 or lower. Calculating the net promoter score involves subtracting the percentage of detractors from the percentage of promoters collected by the survey item.

Here is the formula:

The data comes from surveying your existing customers.

The NPS returns a simple number, but it doesn’t give you the reasons why your customer would or wouldn’t recommend your products or services. To get this information you would need to ask more questions, perhaps open-ended ones.