NPS Index. How to Measure Loyalty
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Technologies similar to Cookies
Similar technologies are technics or tools, using certain characteristics to identify devices so that visits to a website can be analyzed. It includes, for example, HTML5 local storage, local Shared objects, fingerprinting techniques, tracking pixels and plugins.
For ease of reference, cookies and similar technologies are referred as "Cookies".
Usage of Cookies
Cookies enable us to provide users with certain features and supply us with information about website visits.
We also make use of cookies to make our site more user-friendly, to better understand our existing and prospective customers, including associating a user with different devices and browsers that they may use for online targeting and advertising purposes.
A regular ‘Would you recommend our company to your friends?’ style survey helps you understand how interested customers are in your company. One of the first, pre-assessment indicators of such a survey is the activity of those who respond. Clients-promoters are the main factor in the growth of any business. Word of mouth is more effective than advertising: it's free, as personalised as possible and comes from a reliable source.
Customer loyalty to your business is probably one of the main factors in retaining them. First impressions largely determine whether the client will stay with you, whether he will tell his friends about his purchase, whether he will bring them to you. The customer loyalty index NPS (Net Promoter Score) helps to qualitatively assess the customer's attitude, satisfaction, trust and willingness to recommend the shop, service or brand of their choice.
Evaluate by segment
In 2003, consultant and sales expert Fred Reichheld suggested measuring customer experience separately. Since then, his NPS methodology, or sincere customer engagement strategy, is one of the most popular tools for measuring loyalty.
Measuring NPS helps you understand what you need to do to improve your business. With its help you can find the weak and strong points of the company, determine the development strategy and track the effectiveness of the changes introduced. The NPS methodology allows you to assess the business not as a whole, but by segments: delivery, sales, service. But do not forget, since NPS demonstrates satisfaction, it is a lagging indicator.
How to measure the customer loyalty index
Consumers are asked to rate on a ten-point scale the likelihood that they would recommend a company/product/brand to their friends. Having received and processed the survey data, the answers and consumers are divided into three groups: those who gave nine and ten points are so-called promoters, seven and eight points - neutrals, six points and below - critics.
Loyalty is assessed by the formula: (P - K)/n x 100%, where P is the number of promoters, K is the number of critics, n is the number of survey participants.
Customer loyalty to your business is probably one of the main factors in retaining them. First impressions largely determine whether the client will stay with you, whether he will tell his friends about his purchase, whether he will bring them to you. The customer loyalty index NPS (Net Promoter Score) helps to qualitatively assess the customer's attitude, satisfaction, trust and willingness to recommend the shop, service or brand of their choice.
Evaluate by segment
In 2003, consultant and sales expert Fred Reichheld suggested measuring customer experience separately. Since then, his NPS methodology, or sincere customer engagement strategy, is one of the most popular tools for measuring loyalty.
Measuring NPS helps you understand what you need to do to improve your business. With its help you can find the weak and strong points of the company, determine the development strategy and track the effectiveness of the changes introduced. The NPS methodology allows you to assess the business not as a whole, but by segments: delivery, sales, service. But do not forget, since NPS demonstrates satisfaction, it is a lagging indicator.
How to measure the customer loyalty index
Consumers are asked to rate on a ten-point scale the likelihood that they would recommend a company/product/brand to their friends. Having received and processed the survey data, the answers and consumers are divided into three groups: those who gave nine and ten points are so-called promoters, seven and eight points - neutrals, six points and below - critics.
Loyalty is assessed by the formula: (P - K)/n x 100%, where P is the number of promoters, K is the number of critics, n is the number of survey participants.
4 steps: NPS survey for an online dropshipping shop
The NPS metric helps you track the dynamics of customer satisfaction and respond quickly to changes. The NPS survey consists of four simple steps:
1. Objectives
First, determine what information you want to collect to measure loyalty and how you will analyse the resulting data. Only once you are clear on the objectives of the survey can you begin to conduct the research.
2. Questionnaire design
Prepare a simple questionnaire of no more than 5-10 items. Make sure that each NPS question is worded simply and clearly and can only be answered unambiguously. Do not use complex terminology or ambiguous phrases.
For example: ‘You are a customer of our company. We value your opinion. Would you tell your friends and colleagues about us? Please rate your answer on a scale of 0 to 10, where 0 means never and 10 means yes, of course.’ You can leave room for recommendations and additions.
2. Data collection
Develop a data collection strategy. To increase engagement and participation, create an NPS survey in Google Forms. It's familiar and easy to use.
Send out the survey offer and survey link via email, SMS, or to any apps or messengers available to you and the customer. Make sure the survey is available on multiple devices so customers can take the survey anytime, anywhere.
The NPS metric helps you track the dynamics of customer satisfaction and respond quickly to changes. The NPS survey consists of four simple steps:
1. Objectives
First, determine what information you want to collect to measure loyalty and how you will analyse the resulting data. Only once you are clear on the objectives of the survey can you begin to conduct the research.
2. Questionnaire design
Prepare a simple questionnaire of no more than 5-10 items. Make sure that each NPS question is worded simply and clearly and can only be answered unambiguously. Do not use complex terminology or ambiguous phrases.
For example: ‘You are a customer of our company. We value your opinion. Would you tell your friends and colleagues about us? Please rate your answer on a scale of 0 to 10, where 0 means never and 10 means yes, of course.’ You can leave room for recommendations and additions.
2. Data collection
Develop a data collection strategy. To increase engagement and participation, create an NPS survey in Google Forms. It's familiar and easy to use.
Send out the survey offer and survey link via email, SMS, or to any apps or messengers available to you and the customer. Make sure the survey is available on multiple devices so customers can take the survey anytime, anywhere.
4. analyse the results
Analyse the feedback and comments. It is important to scrutinise both positive and negative reactions to understand what makes your dropshipping business successful and what aspects need improvement. Develop an action plan based on the survey results. A high NPS (close to 100) indicates strong customer loyalty, while a low or negative NPS may indicate issues that need attention.
Evaluate the result
NPS between 40 and 50: low level of loyalty. May indicate problems with product quality, customer service, or other aspects of the business.
Need to strengthen outreach to customers who have used your business at least once. Attractive loyalty programmes, discounts, bonuses and special offers encourage customers to stay with you.
NPS between 50 and 70: a sufficient level of loyalty. Actions to build loyalty can be considered quite effective.
NPS above 70: high level and benchmark loyalty. At least 70% of customers are satisfied with cooperation and recommend the product or brand
NPS less than 0: negative reaction. If this result came as a surprise, you need to urgently eliminate the shortcomings that you did not notice or evaluate before.
Special loyalty programmes
40% of profit in dropshipping business comes from regular customers - loyal customers. They create a continuous sales cycle. It is easier and cheaper to retain such a customer, and marketing and advertising costs are minimal.
When dropshipping, it is very important not to fall into the trap of an incompetent partner. Fincraft Capital evaluates target audience engagement for B2B and B2C site partners. It develops models of ‘paid loyalty programmes’ with special privileges, services and services for subscribers. At the same time, Fincraft Capital s.r.o. specialists thoroughly inspect suppliers according to a dozen purity criteria, check the quality certification of goods, and regulate disputable issues.
Analyse the feedback and comments. It is important to scrutinise both positive and negative reactions to understand what makes your dropshipping business successful and what aspects need improvement. Develop an action plan based on the survey results. A high NPS (close to 100) indicates strong customer loyalty, while a low or negative NPS may indicate issues that need attention.
Evaluate the result
NPS between 40 and 50: low level of loyalty. May indicate problems with product quality, customer service, or other aspects of the business.
Need to strengthen outreach to customers who have used your business at least once. Attractive loyalty programmes, discounts, bonuses and special offers encourage customers to stay with you.
NPS between 50 and 70: a sufficient level of loyalty. Actions to build loyalty can be considered quite effective.
NPS above 70: high level and benchmark loyalty. At least 70% of customers are satisfied with cooperation and recommend the product or brand
NPS less than 0: negative reaction. If this result came as a surprise, you need to urgently eliminate the shortcomings that you did not notice or evaluate before.
Special loyalty programmes
40% of profit in dropshipping business comes from regular customers - loyal customers. They create a continuous sales cycle. It is easier and cheaper to retain such a customer, and marketing and advertising costs are minimal.
When dropshipping, it is very important not to fall into the trap of an incompetent partner. Fincraft Capital evaluates target audience engagement for B2B and B2C site partners. It develops models of ‘paid loyalty programmes’ with special privileges, services and services for subscribers. At the same time, Fincraft Capital s.r.o. specialists thoroughly inspect suppliers according to a dozen purity criteria, check the quality certification of goods, and regulate disputable issues.