How NPS and CSAT Measure Quality, Loyalty, and Happiness

By Lisa Douglas

Net Promoter Scores (NPS) measure customer retention; Customer Satisfaction (CSAT) scores measure customer happiness about one specific event or product. Use both scores in tandem to improve your customers’ interaction with your brand.

If you’re looking for honest perspectives about your organization’s offerings and experiences, you need to go directly to the most critical source: your customers. They deserve a quality end-to-end experience with your brand. Two customer-centric informative quality measures are Net Promoter Score (NPS) and Customer Satisfaction Score (CSAT). These methods provide great ways to find out how your customers feel about your brand, and what they think of their interactions with your organization. In this post, we’ll discuss what NPS and CSAT scores are, how to obtain them, and draw the distinctions between them.

Net Promoter Score

Net Promoter Score (NPS) is a trademarked idea and process that companies use to evaluate and improve customer loyalty. It measures how likely you are to recommend your business to a friend. It differs from other customer satisfaction measures in that it measures a customer’s overall feelings about a brand, rather than just a single purchase or interaction. If you want a way to predict your relationship with the customer over the long term, NPS is a respected metric. Ideally, the more your customers interact with your company, the more their satisfaction should increase, and the more your NPS should increase. If you have a low NPS score, that can be a poor reflection on the quality of your organization’s customer experience.

To calculate your NPS, you need to survey your customers. The survey's central question is as follows: “On a scale of 0-10, how likely are you to recommend this company to someone you know?” This question is usually unchanging. You can categorize the respondents into three different groups:

  • Detractors: Those who answer 0-6. These customers will likely give you a negative review because they were dissatisfied with your company. They may take their business elsewhere and tell others to do the same.
  • Passives: Customers who answer the question with 7-8. While their experience with your company could be considered good enough, they are not likely to actively recommend your company.
  • Promoters: These rank 9-10. This group is likely to actively recommend your brand to others. They are loyal to your company and will most likely spread the good word about what your company does.

To calculate NPS, subtract the percentage of Detractors from the percentage of Promoters. This value indicates the net likelihood of your customers recommending your business to a friend. After you determine your company’s NPS, you can know what you’re doing right and identify improvement areas.

Customer Satisfaction Score

Another way to show the quality of your customer experience is your Customer Satisfaction Score (CSAT). It indicates how satisfied a customer is with your particular product, transaction, or indication. You can survey your methods, but you can be more flexible than NPS surveys. There is no industry standard for the type of question you can ask, and you have more control over the scoring. The questions can be about a support ticket, the onboarding session for a new program, a sales process, or a specific feature. You can ask a customer to rank a product on a scale of 1-10, and anything scored over a six can be deemed “satisfied.” You can also feature questions where you have binary “yes/no” or Likert-style answers.

For example, “How would you rate your experience with your…(ex: recent support requirement)?” Sample answers: “Very unsatisfied/unsatisfied/neutral/satisfied/very satisfied.”

To calculate your CSAT scores, you should find the number of satisfied customers. One equation is: “# of customers who responded as ‘satisfied’ ÷ total # of respondents x 100%.” The ideal is 100%, or as close to it as possible, but there is no standard for what makes a good “score.” For example, you can decide that a score of 75 and above is a great score. A high CSAT score can mean that your organization provides high-quality products, services, and experiences to your customers.

Wrap Up

It’s important to note the differences between NPS and CSAT scores and how they apply to customer satisfaction and retention measures in your organization.. As discussed, NPS surveys ask one specific question; CSAT surveys can be more flexible. NPS is about your customer’s overall experience with your brand; CSAT is about your customer’s experience with one specific event or interaction. Since NPS surveys are not tied to a singular sale or event, you can target NPS surveys to a broader audience of users. For the best and most meaningful results, consider measuring NPS periodically (quarterly for example). NPS focuses on the “long game,” consequently, it’s considered a better predictor of customer behavior and is strongly associated with company growth metrics.. The main takeaway is that NPS scores are a long-term measure of customer retention; CSAT scores are shorter-term measures of customer happiness and satisfaction with one specific event or product.

Since one is a longer term and the other is a shorter-term measure of customer retention and satisfaction, you can use both NPS and CSAT scores in tandem to improve how your customers interact with your brand. The more you learn from your customers and take steps to grow and improve, the more you can deliver a customer experience of the highest possible quality.