NPS vs TAM
NPS (Net Promoter Score) and TAM (Total Addressable Market) both come up in business conversations and get confused. Here's the plain-English difference, side by side, so you can use each one with confidence.
The key difference: NPS refers to net promoter score, while TAM refers to total addressable market — they describe different things even when they show up in the same sentence.
NPS — Net Promoter Score
A metric measuring customer loyalty by asking how likely customers are to recommend your product.
TAM — Total Addressable Market
The total market demand for a product or service, representing the maximum revenue opportunity.
When to use NPS
Reach for "NPS" when the conversation is specifically about net promoter score. A metric measuring customer loyalty by asking how likely customers are to recommend your product.
When to use TAM
Reach for "TAM" when the conversation is specifically about total addressable market. The total market demand for a product or service, representing the maximum revenue opportunity.
FAQs
What is the difference between NPS and TAM?
NPS stands for Net Promoter Score — A metric measuring customer loyalty by asking how likely customers are to recommend your product. TAM stands for Total Addressable Market — The total market demand for a product or service, representing the maximum revenue opportunity.
Are NPS and TAM the same thing?
No. They're often used in the same conversation because they're related, but they describe different concepts. NPS = Net Promoter Score. TAM = Total Addressable Market.
When should I use NPS vs TAM?
Use NPS when you're specifically referring to net promoter score. Use TAM when the topic is total addressable market.