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Sales Glossary

The sales industry is always changing and evolving. Keeping on top of those changes can be tough. The Vidyard Sales Glossary is your ultimate guide to important sales terms, definitions, concepts, slang, insider business jargon and more to keep you up to date with the latest in sales industry lingo.

What is a Net Promoter Score?

A net promoter score (NPS) is a benchmark used to measure customer satisfaction and loyalty. Companies send out short surveys (often containing only a single question) to customers to gauge how their brand, and products, are viewed. These answers are then collected and analyzed to calculate a company’s specific NPS.

Why is a Net Promoter Score Important?

Knowing your company’s NPS is important. It allows you to gauge how many existing customers love your product and are willing to give referrals, and where satisfaction may be lacking. Both metrics are important when it comes to your sales pipeline.

If customers are unhappy, you need to figure out why. What type of support are they missing? Are costs too high? Or do they simply require additional information to fully understand your product’s uses? If your NPS is low, it’s time to do some digging and get to the root of the issue before you start losing customers to your competition.

On the other hand, if your NPS is high, you should use those happy customers to your advantage. Build out a referral program and let customers know what benefits they can receive for referring new prospects. Collect testimonials to use in marketing materials and show the fact that your product is amazing and leaves users satisfied.

Every sales team should follow up with customers to help measure their NPS and keep it updated. The information collected from these surveys is invaluable.

How to Calculate a Net Promoter Score

Most companies send out a one-question survey to existing customers asking something along the lines of: “On a scale of 0 to 10, how likely are you to recommend our product to others?”

Answers are then divided into three groups:

  • Detractor: People who reply 0 – 6. They are unhappy with your product and may switch to a competitor and/or leave negative reviews online.
  • Passive: People who reply 7 – 8. They have neutral feelings about your product, and future experiences could sway them to become either a detractor or promoter.
  • Promoter: People who reply 9 – 10. They are extremely happy with your product, and will likely remain as loyal customers, send you referrals, and leave positive reviews online.

To calculate your NPS, subtract the number of detractors from the number of promoters.

For example, let’s say you surveyed 100 customers: 60 were detractors and 45 were promoters. Your calculation would be 60 (detractors) – 25 (promoters) = 35 (NPS).

The goal is to actively grow the number of promoters and shrink the number of detractors as much as possible. This is why it’s important to consistently survey customers; calculating your NPS isn’t done once and then taken at face value.

Questions to Ask on a Net Promoter Score Survey

The question you ask in an NPS survey should reflect your unique business model. You want to engage customers and receive meaningful feedback you can incorporate into future work.

Here are some examples of what you can ask:

  • On a scale of 0 – 10, how likely are you to recommend our product to a friend or colleague?
  • On a scale of 0 – 10, how likely are you to renew your subscription?
  • On a scale of 0 – 10, how satisfied were you with our recent product update?
  • On a scale of 0 – 10, how satisfied were you with your recent customer support call?
  • On a scale of 0 – 10, how satisfied were you with your recent subscription upgrade?

You can ask open-ended questions about the likelihood of recommendations or target specific events to gauge satisfaction with certain experiences. A good rule of thumb is to also include a comment box at the end for any additional feedback the customer may want to send.

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