Customer Satisfaction and Customer Loyalty - What's the Difference?

In this clip from our eLearning series, Allison explores the relationship between customer loyalty and customer satisfaction. You'll learn all about Net Promoter Score (NPS) and how it can be used to measure customer satisfaction. Allison also explains why NPS can also be an indicator of customer loyalty.

How can you measure customer satisfaction?

One of the most common metrics that measure customer satisfaction is Net Promoter Score (NPS). While there are other ways to measure satisfaction as well, NPS is a very clean way to understand how someone feels about your brand. Are they likely to recommend your brand to a friend or colleague? A high NPS would indicate that they are.

How does Net Promoter Score work?

NPS Scale

To measure NPS you ask customers if they would refer your brand to someone else. The responses you get are measured on a scale of 1-10. A score of 0-6 indicates a poor NPS and those customers are considered detractors. On the other hand, a score of 9 or 10 is a very positive NPS and those customers are considered promoters. To get your final NPS you subtract the difference between detractors and promoters. People who have a rank of 7 or 8 are considered passive and are not included in the final NPS. Brands could map Net Promoter Scores to CLV to challenge some assumptions they have about their customers. For example if the customers who buy the most from your company are in the detractor range for NPS, it could signal that there's a problem that needs to be addressed immediately before they stop buying from your company for good.