Sometimes business is good. Sometimes business is bad. There might even be times when business isn’t good or bad, and it’s just stable.
Although there could be a million and one reasons these fluctuations are occurring, it’s always a good idea to try to get to the bottom of them. Even if it’s good, if everything is trending upwards (congratulations), you shouldn’t just keep your fingers crossed and hope it continues — you should figure out what is behind this and if there’s a chance to capitalize on this.
And this is exactly where the NPS formula comes in.
In this article, we’re going to explore what the NPS calculation formula is, how to apply and analyze it, and even how it can be used to check employee morale and see how candidates rate your hiring processes.
What Is Net Promoter Score (NPS formula)?
The NPS formula (Net Promoter Score) is a tool you can use to help you assign a metric to track and measure customer loyalty by asking respondents to rate their likelihood of recommending your company, product, or service to a friend or colleague.
This is usually done on a scale of 1 to 10, and the NPS will be reported as a number between -100 and +100, with higher numbers indicating greater desirability.
The NPS formula was first developed by Bain & Company consultant Fred Reichheld and shared with the world in his 2003 Harvard Business Review article. And now, over 20 years later, it has not only been adopted by millions of companies, but is considered the gold standard for measuring customer perception and brand health.
However, you would be mistaken in thinking that the NPS formula is just a tool for tracking customer satisfaction, as it can also be used to determine whether your business is positioned to generate enthusiasm among customers who will go on to bring you referrals via word of mouth. The higher the number, the more your company is delivering products and services to clients that bring them value, while a lower or declining number indicates that somewhere along the buyer's journey, there is a problem that is leaving them dissatisfied.
The great thing about the NPS score being based on one question is that it means it’s easy to start using as a metric, get consistent quantifiable responses, and establish benchmarks to understand if you’re doing everything in your power to create a customer experience that moves the needle in the right direction.
How to Calculate the NPS Formula: Promoters Minus Detractors
Implementing the NPS formula is a matter of understanding that when you’re collecting results, the responses fall into one of three categories:
- Promoters (9–10) — The loyal enthusiasts who actively refer others and drive growth
- Passives (7–8) — Those who are satisfied but unenthusiastic customers who remain vulnerable to competing offers
- Detractors (0–6) — The respondents who are unhappy customers who can actively damage brand reputation through negative word-of-mouth
To understand who falls where when implementing the NPS formula, you divide the number of Promoters by the total to get your promoter percentage, and then do the same for the detractors. Once you have this, you subtract the detractor percentage from the promoter percentage, and there you go, you’ll have your NPS score formula sorted.
You might be wondering about the in-betweeners, the passives.
Passives are excluded from the NPS formula because they aren’t opinionated enough to positively or negatively talk about your business (but they are important, and we will focus on them in more detail later).
For now, the NPS formula is as follows:
NPS formula = % Promoters − % Detractors
So, if you want to learn how to calculate NPS, let’s use an example.
Let’s say you sent out and received 100 survey responses, and the results were:
- 50 Promoters
- 30 Passives
- 20 Detractors
Using the NPS formula, first, we would calculate the percentages:
Promoters % = (50 / 100) x 100 = 50%
Detractors % = (20 / 100) x 100 = 20%
Then, from there, to finish the NPS formula, you simply subtract the detractors from the promoters:
NPS Score % = 50% - 20% = 30%
What is a good NPS score? 30% might seem low, but anything above a 0% is considered good, while anything above a 50% is considered excellent. However, if you do get a score that is below 0%, that signals that negative word-of-mouth is outpacing those who are willing to talk positively about your business, and ignoring this risks driving clients and future leads to look for services and products from your competition instead.
Did you know? The NPS formula can be used to track more than customer satisfaction. It can be used to gauge whether your employees are likely to recommend others to work at your company, and this version is called eNPS. If you want to learn more about this, scroll down to How to Use the NPS Formula to Improve Employee and Candidate Experience.
Passive Respondents: Why They Matter More Than You Think
So, we acknowledged that when using your NPS formula and making your calculations, you don’t include the passives.
And it makes sense to some degree — they’re not unhappy enough to cause you problems, and they are happy with everything. However, they do represent untapped potential and eventually will become a lost opportunity because they just quietly exist — it’s too easy to forget they exist as you try to win back detractors, and they inevitably just fade away. According to research published by the same company that created the NPS formula, Bain and Company found that 68% of churned B2B customers were Passives. While you’re focused on trying to make detractors happy, your passives are silently growing dissatisfied, and by the time you realize there’s a problem, half of your clients have churned.
And now you have to run new campaigns and invest more money to backfill those passives who have gone — instead of just investing a little bit into them and potentially turning someone who rated you an 8 into a 9 or 10 (which is a smaller gap than trying to turn a 6 into a 9).
It’s just as easy for a competitor to take your passives from you too.
Most passives stick with a company because it’s convenient, not because they are loyal. For them the hassle of switching might outweigh sticking with you. And if your competitors can figure that out, you’re going to easily lose them to:
- A free trial
- Easier user experience
- Lower cost
- Better quality
- Or even word of mouth
The difference between detractors and passives is that they’re loud, giving you a chance to hear them and offer them solutions.
A Passive just leaves without giving you a chance, even though they had nothing bad to say about your company.
So, when you’re implementing your NPS formula and creating your survey, think about including an open-ended question to give the Passives a chance to explain what doesn’t make them a Promoter. Is it:
- A missing feature
- The price
- No emotional connection
This will help you collect behavioral signals and let you sub-segment your passives to see if there’s a low-hanging fruit that can help convert the passives into promoters, by identifying things like:
- Usage trends
- Support contact frequency
- Engagement patterns
Okay, now that we have gotten that off our chests, let’s continue with going into more detail about problems to avoid with your NPS formula.
3 Common NPS Formula Mistakes and How to Avoid Them
Even well-resourced CX programs make errors that quietly undermine NPS reliability.
And most of these errors don't have the common decency to announce themselves. Instead, these errors appear as scores that don't reflect business reality or yield actionable insights.
There are three things you should avoid when implementing an NPS formula in your business.
1. Survey Design and Timing
The standard NPS format exists for a reason:
One rated question, followed by one open-ended question asking why.
Modifying the core question, adjusting the scale, or skipping the follow-up introduces bias and leaves you with a number rather than a diagnosis.
You should also carefully plan when you will send the survey to your audience, as this will affect the NPS score as well. Take, for example, a transactional NPS, which captures sentiment immediately after a specific interaction, and a relationship NPS, which measures broader brand sentiment. Conflating the two produces scores that reflect the wrong thing entirely, and sending surveys too frequently or repeatedly to the same customers drives down response rates and quality.
2. Acting on Results
Collecting NPS data without a structured response process is one of the most costly program failures.
When Detractors receive no follow-up, the message is that their feedback wasn't wanted, accelerating churn rather than preventing it. Assigning ownership of low-score follow-up, logging complaints, and confirming resolution are the bare minimum requirements of building a functional closed-loop process.
Don't neglect Promoters or Passives either. A 9 or 10 Promoter with no acknowledgment is a missed opportunity for referrals, reviews, and qualitative feedback on what's working, and (as we already explained) your Passives are also a gold mine just waiting to be explored if you take the time to digest the results and follow up with a plan to increase their satisfaction.
3. Interpretation and Program Design
A score drop alone doesn't reveal whether the cause is a:
- Product issue
- Service failure
- Something segment-specific
Pairing an NPS with CSAT and CES, and cross-referencing support tickets, churn rates, and usage data, is what takes something from a score to a diagnosis that can help you fix a problem. Segment your results too, as an aggregate score can look healthy while masking serious problems in specific customer groups.
And there you have it! Everything you need to know about the NPS formula, but as already mentioned, applying NPS doesn't just stop at gauging customer satisfaction, as it can also be used as a recruitment metric and a way to measure how strong your company culture is.
How to Use the NPS Formula to Improve Employee and Candidate Experience
You can repurpose your NPS formula for measuring things internally to see how happy your employees are and how happy candidates are with your hiring processes using:
- Employee Net Promoter Score (eNPS formula)
- Candidate Net Promoter Score (cNPS formula)
Both work the same way as the NPS formula covered in this article and use open-ended questions to gather more data from employees and candidates that is easier to act on.
Candidate Net Promoter Score (cNPS formula)
Nowadays, candidates like to have more insight before applying or accepting job roles, with job seekers using employer review platforms like Glassdoor.
According to some research, one in five job seekers turn down job offers after researching and learning that the job in question comes from a company with a negative brand perception. And it’s no different in the hiring experience, with one in three job offers declined by candidates after a terrible experience with the hiring process. Whether it's from negative reviews from former employees or candidates disliking how you do your hiring, a bad hiring process rarely stays private, and this type of negative attention shapes how people perceive your brand and leads to even more hiring problems as people start to run for the hills when they see your company's name in the job boards.
Using a cNPS formula will help you investigate and measure the likelihood that a candidate will recommend others to join your company based on their experience during the hiring process.
And like the Detractors from the NPS formula, rejected candidates are often ready to give you a piece of their mind and speak candidly about their experience. Which might sting, but will give you better insights into what you’re doing wrong and give you data that will be more actionable.
Although we mentioned that you should avoid bombarding people with NPS, with the cNPS, it doesn't hurt to send a survey after each major touch point so you can identify if there’s a specific stage in the process that is causing a problem, so you can closely analyze everything, such as:
- Application submission
- Screening call
- Technical assessment
- Final interview
- Hiring decision
For example, a candidate might rate the actual interview process highly, but the application process a five or less, indicating that something at this stage is causing a problem (let’s be honest, it’s likely the bespoke system, the CV upload, the cover letter, and the 72 fields you’ve asked them to fill out).
If you’re a larger company dealing with a high volume of applications, then you should consider turning to an applicant tracking system (ATS) that can help you integrate cNPS formula surveys. Or, alternatively, if your HR team is struggling to handle the volume of applications coming in, you can also turn to Recruitment Process Outsourcing (RPO) to help you manage this workload.
Remember, the same goes for the NPS formula; closing the loop on surveys is extremely important, regardless of the rating.
But here, you should go the extra mile and offer a personalized response to the candidate's feedback because, even if they were rejected, candidates who feel seen and heard are more likely to:
- Reapply
- Refer others
- Leave neutral or positive reviews
And if you keep up this level of service to your candidates, the impact on your employer branding will compound over time.
Employee Net Promoter Score (eNPS formula)
eNPS formula asks employees how likely they are to recommend the company as a place to work.
A strong eNPS formula correlates with higher engagement, lower attrition, and better external brand advocacy (employees who would actively recommend their workplace are, in effect, a recruitment asset).
The cadence for eNPS formula differs from cNPS formula.
Quarterly or four-monthly pulse surveys give enough time between cycles to implement changes and measure their effects, which makes trend analysis meaningful. Sending surveys too frequently compresses that feedback loop and makes it harder to attribute score movements to specific initiatives.
Anonymity is non-negotiable for eNPS formula to generate honest data.
Employees who can't submit feedback anonymously will self-censor, particularly on questions touching management, compensation, or internal culture. The score that results from non-anonymous surveys tends to be inflated and operationally useless.
As with any NPS formula program, the score identifies that a problem exists, and the open-ended comments identify what it is.
Detractor feedback in eNPS formula commonly clusters around:
- Communication failures
- Management issues
- Tooling or process frustrations
These specific and addressable categories get lost when organizations track the number without reading the qualitative layer beneath it.
Promoter feedback is equally worth examining, as the departments with consistently high eNPS formula scores are running something that works, and making those practices visible to the rest of the organization is a practical improvement lever that most companies underuse.
Shared Best Practices
Both cNPS formula and eNPS formula programs benefit from clear internal communication about what the data is being used for.
Candidates and employees are more likely to complete surveys when they've seen prior feedback lead to visible changes. Sharing aggregated results and the actions taken in response closes the loop at the program level, not just the individual level, and builds the credibility that sustains participation over time.
Segmentation applies to eNPS formula as much as it does to cNPS formula.
An organization-wide eNPS formula score that looks healthy can mask serious problems within specific teams, tenure bands, or locations. Stratifying results by department, role level, and time with the company is what converts a headline number into a roadmap.
And that about wraps up our article on the NPS formula, how you can implement it, and how to get the most out of it with your business.
One thing that you might have picked up on while reading this is how all these formulas (regardless of whether you survey customers) and their scores are affected by two things:
Your company and workforce.
Having the right employees working together, equally motivated and supported by management, is the key to increasing your NPS scores. Do you need help with recruiting and improving brand perception with clients, customers, and candidates? Why not try TalentHub?
TalentHub is a European all-recruitment agency that manages end-to-end hiring for startups and growth-stage businesses, from pre-seed through Series C.
They operate across technical, leadership, and senior roles, and operate as an embedded recruitment partner rather than a traditional agency, handling everything from sourcing strategy and candidate pipeline management to interview coordination, offer delivery, and onboarding. They emphasize candidate experience and employer brand as part of their service, and work primarily with companies across Europe.
If you need help after applying your NPS formula and seeing less-than-desirable results, head over to TalentHub and book a call with us, and we can tell you all about how we can help.
