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Tracking net promoter score (NPS) to predict churn

Tracking net promoter score (NPS) to predict churn

Net promoter score (NPS) is a widely used metric to gauge customer satisfaction and loyalty. It asks customers a single question: “How likely are you to recommend this product or service to a friend or colleague?” The score is measured on a scale of 0 to 10, where respondents are classified into 3 categories:

  • Promoters (scores 9-10): Loyal customers who are likely to recommend the product.
  • Passives (scores 7-8): Satisfied but unenthusiastic customers.
  • Detractors (scores 0-6): Unhappy customers who are at risk of churning and may negatively affect the brand through word of mouth.

NPS is calculated by subtracting the percentage of detractors from the percentage of promoters. For example, if 60% of your customers are promoters and 20% are detractors, your NPS score would be 40. An NPS score between 0 and 50 is generally considered average to good, while scores below 0 may suggest significant dissatisfaction among customers. Scores above 70 are considered excellent.

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