Net Promoter Score Calculation | Will Your Customers Help You Grow?

We learn the net promoter score calculation in Excel using an example with real customer survey data. Why is the NPS so important? Because it's one of the most predictive KPIs for business growth.

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For decades, the NPS has proved itself one of the most powerful predictors of customer retention and business growth. For this reason, companies (large and small) & investors have been laser-focused on measuring this metric to evaluate products & businesses.

In this video, we learn about how to calculate the net promoter score using data from a customer survey. We also look at some NPS benchmarks as well as discuss the normal range for typical businesses.

It is quite straightforward and you can do it in Excel easily - and I included a free downloadable template as well.

So what does the NPS really tell us?

The net promoter score tells us if the majority of our customers are having a great experience ("promoters"), or a bad experience ("detractors").

To do a net present value survey, you must ask customers the following question: On a 1-10 scale (10 being the most), how likely is it that you would recommend our product/service to a friend or colleague?

Based on this data, the net promoter score calculation is very simple, you just do a simple equation:
NPS = % of Promoters - % of Detractors

PROMOTERS (score 9-10)
Customers having a great experience (promoters) will help us grow. They will be less price sensitive, have high retention (be very loyal), perceive our product as having high value, and refer our product to other people.

PASSIVES (score 7-8)
Customers having a good but not great experience (passives) probably won't refer us to friends, but also won't hurt our brand. These people don't really help or hurt the growth.

DETRACTORS (score 1-6)
Customers having a bad experience (detractors) will write us bad reviews publicly, have low retention (be very likely to switch/cancel), be very price sensitive, and will damage our brand.

This data gives you a great idea of the overall customer experience with your product/service.

I hope that you can now feel confident calculating the net promoter score in Excel. If you have questions (I'm sure you do) - please leave comments below and I'll try to help. Cheers!

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