Net Promoter Score (NPS) is used to gauge your customer satisfaction and loyalty, and serves as an alternative to the traditional overall satisfaction rating.
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This is a key metric for any hotelier to keep an eye on, and some businesses have found a correlation between their NPS and their revenue growth.
Your NPS is calculated based on guest responses to the very first question your guests are asked on your GuestRevu survey: “How likely would you be to recommend us to friends and family?”
How do the scores work?
Each guest will be asked how likely they would be to recommend your hotel to a friend on a scale of 0 to 10, with 0 being the lowest rating and 10 being the highest. Based on their rating, guests are then classified into 3 categories:
- Promoters (9-10)
The Net Promoter Score is then calculated by subtracting the percentage of guests who are detractors from the percentage who are promoters. The resulting number between -100 and 100 is your NPS.
Why does your NPS matter?
Knowing your hotel’s Net Promoter Score puts the ball in your court to either make the necessary changes to improve your standard of service, or build on your current practices to ensure guests keep coming back.
There are a number of benefits that arise through analysing and improving your NPS, such as:
- Improved profit margins – promoters aren’t as price-sensitive as other guests, as they see great value in the services your hotel provides. Detractors tend to think they’re getting a raw deal. What cost-effective measures can you introduce to add value to your existing service?
- A higher guest retention rate – detractors tend to defect at much higher rates than promoters, which means a shorter, less profitable relationship with your hotel. Does your staff need interpersonal training? Are there little touches you can add, like chocolates on a pillow or fresh flowers in a room, that will enhance your guest's experience? Focus on ways to turn detractors into promoters in order to retain guest loyalty and boost profits.
- Greater cost efficiencies – promoters stay for longer periods and help generate solid referrals, thereby reducing customer acquisition costs. Detractors have more complaints and tend to consume more service resources.
- Higher annual spend – promoters spend more, more often, than detractors and group their spending with one trusted supplier – you. As far as possible, your hotel should be a one-stop-shop for guests. Why give them a reason to go elsewhere when you could introduce new offerings?
- Greater word of mouth – it goes without saying that promoters can contribute a great deal of new business, while detractors can drag your name through the mud. Give guests something great to talk about, make their stay with you memorable, and you’ll have a promoter to sing your praises to the masses. It’s usually a lifetime value.
What should my NPS Score be?
The higher your NPS score, the better, and as long as it’s in the positive figures, your promoters outnumber your detractors. If you’re only looking to compete against yourself, we recommend aiming for your NPS for any given month to be higher than your 12-month rolling average. If you want to know how you compare to other GuestRevu users, take a look at these average stats and benchmarks.
Want a bird’s-eye view of your property’s key performance indicators? They are all ready and waiting on your dashboard. The more data you collect through surveys and online reviews the more insight you will have! If you’re only using online reputation management, upgrade now.
The Net Promoter Score (NPS) was developed by Fred Reichheld, Bain & Company, and Satmetrix, and is a registered trademark.