At Alunta we have decided to createa a dictionary for words and important terms related to running a subcription busniess. You are now reading about “Net Promotor Score (NPS)”.
A high NPS is an indicator of customer satisfaction, loyalty and advocacy. It means that customers are not only pleased with your product or service, but they are also likely to recommend it to others. This can lead to increased customer retention, reduced churn rate, and more referrals, all of which are crucial for the growth and profitability of a subscription-based business. In addition, high NPS can also provide a competitive edge in the market, as it reflects superior customer experience.
Improving NPS requires efforts to enhance customer satisfaction and loyalty. This could include offering high-quality products or services, providing excellent customer service, and responding promptly to customer inquiries or complaints. Regularly soliciting customer feedback and acting on it can also be effective. It's important to identify the factors that drive promoter scores and work on them. Additionally, it can be beneficial to segment customers and devise tailored strategies to meet their specific needs or expectations. Training staff in customer service skills can also contribute to a higher NPS.
A negative NPS implies that a business has more detractors than promoters, which can be detrimental for its reputation and growth. Detractors are likely to discourage others from subscribing to the service, leading to fewer new customers. They may also leave negative reviews online, impacting the business's brand image and credibility. This can further result in reduced customer retention and increased churn rate, both of which can negatively affect the business's revenue and profitability. Therefore, it's critical for subscription businesses to strive for a positive NPS.
Check out other topics in our subscription dictionary below. We've gathered the ones we find most relevant in relation to net promotor score (nps).