Net Promoter Score (NPS): What It Is, How to Calculate It, & How to Use It

If you’ve spent any time in customer experience, you’ve definitely encountered NPS.

It shows up in board decks.

It gets flashed in town halls.

It’s proudly written on dashboards in bold green or alarming red.

And yet, if we’re being honest, many teams don’t quite know what to do with it. 

I’ve seen organizations celebrate a good NPS while customers were quietly churning. I’ve also seen teams panic over a dip in NPS without understanding why it dropped or what actually needed fixing.

So, let’s slow this down.

This article isn’t about worshipping Net Promoter Score. It’s about understanding it, calculating it properly, using it responsibly, and most importantly, knowing its limits. 

What is NPS (Net Promoter Score), Really? 

At its simplest, Net Promoter Score answers one question:

How likely are you to recommend our company/product/service to a friend or colleague?

The response is captured on a scale of 0 to 10. 

Based on that single number, customers are grouped into three buckets:

• Promoters (9–10)
  Loyal, enthusiastic customers who are likely to stay and advocate for you.
• Passives (7–8)
  Satisfied but unenthusiastic customers. They’re comfortable—but easily tempted elsewhere.
• Detractors (0–6)
  Unhappy customers who may damage your brand through negative word of mouth.

NPS is calculated by subtracting the percentage of detractors from the percentage of promoters.

That’s it.

No averages. No fancy weighting. Just a simple subtraction.

And that simplicity is both its biggest strength and its biggest weakness.

Why NPS Became So Popular in the First Place

NPS didn’t become popular because it was perfect.

It became popular because it was practical. 

Before NPS, many customer metrics were:

• Too complex
• Too fragmented
• Too disconnected from business outcomes

NPS cut through that by focusing on loyalty and advocacy, not just satisfaction.

The thinking was elegant:

If customers are willing to recommend you, they’re probably happy, loyal, and less likely to leave.

That made NPS attractive to leadership teams. 

One number. Easy to track. Easy to compare. Easy to communicate.

But ease often comes at the cost of nuance.

How Do You Calculate Net Promoter Score?

Let’s get precise here, because this is where confusion often starts.

Step 1: Ask the NPS question

Ask customers to rate their likelihood of recommending you on a scale of 0–10.

Step 2: Categorize responses

• Promoters = ratings of 9 or 10
• Passives = ratings of 7 or 8
• Detractors = ratings of 0 to 6

Step 3: Calculate percentages

Let’s say you surveyed 100 customers:

• 55 Promoters
• 25 Passives
• 20 Detractors

That means:

• % Promoters = 55%
• % Detractors = 20%

Step 4: Subtract

NPS = % Promoters – % Detractors

So in this example:

NPS = 55 – 20 = +35

Your NPS can range from –100 to +100.

Anything above zero is generally considered positive. But context matters far more than the number itself.

What is a Good Net Promoter Score Across Industries?

This is one of the most common questions, and also one of the most misleading.

There is no universal good NPS. 

Why? 

Because expectations vary dramatically by industry, geography, product complexity, and even price sensitivity.

That said, here are rough directional benchmarks: 

• Banking & Financial Services: +20 to +40
• Healthcare: +10 to +30
• Hospitality & Airlines: +40 and above is considered excellent
• B2B SaaS: +30 to +50 is strong
• Retail & eCommerce: +30 to +60
• Telecom & Utilities: +10 to +30

The bigger mistake isn’t having a low NPS.

It’s comparing your NPS to companies operating in a completely different context. 

A luxury hotel and a government utility are not playing the same game.

Why Measuring NPS Alone is a Trap.

Here’s where I get opinionated.

Too many organizations measure NPS like a scoreboard, not like a diagnostic tool. 

They track:

• Monthly NPS
• Quarterly NPS
• Leaderboard-style NPS by team

But they don’t ask:

• What experiences created this score?
• What broke between last month and this month?
• Which parts of the journey are driving detractors?

NPS is not a strategy.

It’s a signal. 

And signals are useless unless you investigate their source.

How to Use NPS Effectively

This is where NPS becomes powerful, or pointless.

#1 Always pair NPS with a ‘why’ question

The score alone tells you what. 

The follow-up tells you why. 

Ask something simple like:

What is the primary reason for your score?

This qualitative insight is where real CX improvement lives.

#2 Segment ruthlessly

Overall, NPS hides more than it reveals.

Break it down by:

• Customer tenure
• Product line
• Channel (support, onboarding, sales)
• Geography
• Customer persona

You’ll often find pockets of excellence and pockets of pain living side by side.

#3 Close the loop with detractors

If you collect NPS and never act on it, customers notice.

Reaching out to detractors:

• Shows you care
• Helps you recover relationships
• Reveals systemic issues early

And no, this shouldn’t be a templated apology email. It should be a genuine attempt to understand and fix.

#4 Track trends, not just scores

A static NPS number is less useful than its direction.

• Is NPS improving after a product change?
• Did it dip after a pricing update?
• Did onboarding NPS improve after process simplification?

Movement tells a story. 

Isolated numbers don’t.

#5 Link NPS to operational metrics

The real magic happens when NPS is connected to:

• First Contact Resolution
• Repeat contact rate
• Onboarding completion
• Time to value
• Churn and expansion data

When you can trace NPS changes back to operational levers, it stops being a vanity metric.

Common NPS Mistakes to Avoid

I’ve seen these mistakes repeatedly across industries.

#1 Gaming the score

Asking customers to “please give us a 9 or 10” defeats the entire purpose.

It might improve the number.

It will destroy trust.

#2 Ignoring passives

Passives are often dismissed because they don’t affect the score.

Big mistake.

Passives are the most vulnerable segment. They’re satisfied but not loyal. Many churn quietly without ever becoming detractors.

#3 Treating NPS as an individual performance metric

Tying agent bonuses or appraisals directly to NPS can create fear-driven behavior.

People start optimizing for scores, not experiences.

NPS should reflect system health, not individual blame.

#4 Survey fatigue

Over-surveying customers reduces response quality.

Ask at the right moments.

Respect their time.

Fewer, well-timed responses are far more valuable than mass polling.

NPS vs CSAT vs CES: What is the Difference?

This is where clarity really helps.

Each metric answers a different question. 

Here’s the simplest way to think about it:

• CSAT tells you how customers felt about something that just happened. 
• CES tells you how hard they had to work
• NPS tells you whether they believe in you enough to recommend you

They are complementary, not competitive.

If you use only one, you’re seeing the world through a keyhole.

When NPS Works Best

NPS is most valuable when:

• You want to understand loyalty trends over time
• You combine it with qualitative insights
• You use it to guide improvement, and not to celebrate

It works especially well in:

• Subscription businesses
• B2B relationships
• Products with long customer lifecycles

NPS doesn’t tell you whether your customers are happy.

It tells you whether they trust you enough to put their reputation on the line. 

That’s a much higher bar.

Used correctly, NPS can highlight:

• Broken journeys
• Invisible friction
• Emotional disconnects
• Missed expectations

Used lazily, it becomes just another number that everyone watches, and no one owns.

So, here’s my take:

If your NPS is high and you don’t know why, you’re at risk.

If your NPS is low and you’re willing to listen deeply, you’re already on the path to improvement.

NPS isn’t broken.

It’s honest.

The real question is whether we’re brave enough to listen to what it’s telling us and disciplined enough to act on it.