Net Promoter Score explained

Net Promoter Score (NPS) is one of the ways we measure how happy our customers are. Here's how it works.
By Team member, 16/01/2019
4 minutes read

The "Net Promoter Score" (or NPS) system is used to find out how likely a company's customers are to recommend them to friends and family. It's a super helpful tool to get an idea of how satisfied and loyal their customers are.

It's really quick and easy for both the company and the customer. And as lots of other companies use it too - all asking the exact same question - it can give you an idea of how each company compares to one another.

How does it work?

It works by asking customers to rate how likely they are (on a scale of 0-10) to recommend the company to friends or family. It's also common to provide an optional comment box for them to leave a little more feedback.

The rating given by the customer allows them to be classified into one of three groups. A particular customer's group may not actually match their behaviour, but statistically this is likely.

Customers who give a rating between 0-6 are classified as "detractors". Put simply, they are likely to say negative things to others about the company - usually if they've had a bad experience with the company. 🙁

Each customer that gives a rating of 7 or 8 is classified as "passive". This means that, although they probably haven't had a bad time, they're also not impressed enough to shout about it - i.e. they are not likely to affect what other people think of the company.

Finally, every customer that gives a rating of 9 or 10 is considered a "promoter". 🎉 These tend to be the people who love what the company's doing, and are right behind them every step of the way, singing their praises. Or they just had a really great experience using the company's products. Either way, it goes without saying that the 9s and 10s are a good sign that you're doing something right!

How is the overall score calculated?

From all the responses, the company gets an overall score. The score is worked out by taking the percentage of detractors away from the percentage of promoters. For example, if 79% of people were promoters and 9% were detractors, the overall score would be 70. The 12% of passive customers don't directly affect the score.

The score can be as low as -100 (which would mean virtually every customer thought of the company negatively 😱) or as high as 100 (everyone thinks they're great 😍) - every company sits somewhere in between.

What do the scores mean?

What you consider to be an impressive score in the world of NPS depends on how you view it. Strictly speaking, any score above 0 (however low) means that the company has more customers who say nice things about them (promoters) than people who say not-so-nice things (detractors). A higher score indicates that there are more people who enjoyed using your product or service, so much so that they'd tell their friends and family.

Generally, anything above 0 is considered "good", 50 or above is considered "excellent", and 70 or above is considered "world class". The industry average for car insurance was -4 in 2017

Why are we telling you this?

At Cuvva, when we say "car insurance the way it should be", we mean it. We aim to make products that work really well for all our customers, regardless of the old-school industry practices that we've all come to think are normal. We believe the basic standard should be for everyone to have a seamless and hassle-free experience using Cuvva, so it's key that we can learn every time things don't quite go right.

We've found that measuring our NPS is a super helpful way for us to see how we're getting on, and - most importantly - how we could do better with our temporary car insurance, temporary van insurance and learner driver insurance.

A great example of this is our Customer Operations team. We work really hard to make sure we can provide our customers with support whenever they need it. Even though nobody has this expectation from insurance companies, we have a 1 minute response time, 9am to 9pm, 365 days a year. Yes, even Christmas day!

Another example is the product itself. Our engineers and designers have always focussed on making the experience as easy as possible. By taking the time to create clever systems behind the scenes, they can make things go much more smoothly.

One example is how we ask users for vehicle reg plates. Can you tell whether that letter on the plate is an "I" or a "1"? Is it an "O" or a "0"? It turns out, they're printed exactly the same way, so there's no way to tell! If you do enter the wrong one, our system will automatically correct it (just try typing in "LBO7 SE0"). 🤓 Other insurance companies: please start doing this! Your customers will appreciate it. You can even use our code.

Given how important it is to us to offer this experience (and how much work we put into delivering it), you can imagine something like the NPS is important too. It's not enough for us just to think we've probably made the customer experience better, without our customers confirming we've made a difference. Are we really providing the level of service we think we are?

The good news is that according to our customers, we're doing pretty well. Our NPS score for 2018 was 70, which is a pretty great score more generally, but is particularly good compared to the rest of the insurance industry. 🥳 This is a nice way to make sure we are on the right lines and it's really satisfying to know that we are making a difference, and hopefully pushing forward people's expectations of the industry as a whole.

What do we do with it?

It's really important to remember that the NPS feedback is only one part of the picture - there's a load of other ways we collect feedback and test what we're doing. Nevertheless, the NPS system is a great tool to help us learn and improve. Not only can we get confirmation that the stuff we are doing is working for our customers, but we can also learn where things aren't as great.

We review each and every comment we receive as part of the NPS survey, and take all feedback on board. If you have any feedback about any part of the Cuvva experience that you'd like to share with us, or you just fancy a chat, get in contact at 😊

Team member