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Discussion on Net Promoter Score (NPS)

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Net Promoter Score (NPS) is a metric used by businesses to measure customer satisfaction, in particular their loyalty to a product or company.

In this assignment, you will research the concept of NPS.

Visit the Netpromoter website and learn how to calculate a net promoter score. You will want to look up other websites for examples.

You will also be looking up some of the critical views of NPS, summarize them, and then voice your opinion on the merit of the measure.

Be sure your paper covers the following highlights:
*Discuss how the net promoter score is calculated.
*Show an example of a calculation of a net promoter score (use the data below). *What does this score mean specifically in this example?
*Discuss how the net promoter score can assist in the value of a company.
*Discuss at least two criticisms of the use of net promoter scores.

Here is some sample data of NPS questions (Would you be likely to recommend Product X? Scale from 0-10 points) of 21 customers: 9,4,7,4,2,0,10,9,3,6,8,7,3,9,8,8,7,9,10,4,2

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The solution gives some deeper discussion on net promoter score with examples. Reference is cited.

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*Discuss how the net promoter score is calculated.
We first classify the data into three categories: promoters = respondents giving a 9 or 10 score, passives = respondents giving a 7 or 8 score and detractors = respondents giving a 0 to 6 score. Then we record the number of the occurrence in each all three categories. NPS is calculated as the percentage of promoters minus the percentage of detractors.

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