It’s often said that feedback is a gift and this is definitely the case with customer feedback.
Feedback from your customers allows you to dig into their opinions and draw out information that will help you enhance your products.
Improving your products/and or services will make your customer experience (CX) better, which will in turn lead to more sales.
When you look at it this way, feedback, whether positive or negative, is the best thing that could happen to your business.
However, you need to be smart when it comes to your customer feedback strategy. The first step is recognizing customer feedback's importance. You then need to know how to collect it and finally what to do with it.
We’ll go through all that and more here:
Customer feedback is the information that you collect from your customers that tells you what they think about your products and services and your organization as a whole.
Feedback can come in a number of formats. You can receive it via direct channels like surveys, focus groups, etc. It can also come to you indirectly via unsolicited emails, social media comments, or review sites.
Feedback can be positive, negative or neutral, and while it can be hard to hear, it’s often the negative feedback that is the most useful. To quote Bill Gates, “your most unhappy customers are your greatest source of learning.”
Timely and relevant customer feedback allows you to pinpoint what is working for your customers and what is not. This lets you make the necessary changes to retain existing customers, as well as gain new customers.
Customer feedback, and how you decide to harness it can have a big impact on your future growth and profits. Here we’ll go through 7 reasons why customer feedback is so important and beneficial:
Collecting customer satisfaction feedback helps you find out how happy your customers are with your products, services, and overall brand.
This is important because, as you might expect, happy customers tend to be more loyal and loyalty leads to repeat sales.
Unsatisfied customers on the other hand are likely to leave you for your competitors at the first signs of a poor customer experience.
With these surveys you can see your customers’ perceptions of your company as a whole or dig down into specific pain points that they are experiencing. When you do this, you have more chances of correcting these problems before they become bigger issues, which will help increase customer satisfaction.
People like sharing their thoughts and being listened to, it’s human nature. Dialog in which people feel heard also builds trust; it is validating and it makes us feel that we matter.
The studies also back this up. According to recent Microsoft research, 89% of respondents stated that they actually wanted to provide feedback to brands.
When your customers are actively coming to you with their thoughts you can’t afford not to listen and acknowledge their feedback.
In order to increase customer engagement you need a solid customer feedback loop. This means, you should request feedback, analyze it, act on it, and let customers know that they’ve been heard, thus closing the loop.
Changes you make based on customer feedback are likely to result in enhancements for your customers. The added bonus is that they’ll feel engaged knowing they were listened to.
If you design and launch products without customer feedback you are acting blindly. Instead you should use your customers' opinions to steer the direction of your product.
Feedback can also tell you whether your customers are likely to buy a potential new product in the first place.
When you let your customer help you prioritize your product roadmap, it’s more likely to be something they want to use and something that they would recommend to a friend.
With instant product feedback, like via in-app surveys or feature requests, you can closely track where your product is coming up short, so that you can tweak it or add new features and functions.
This kind of feedback is beneficial because it results in products that work exactly how the customer wants them to, making it more likely that they’ll come back for more.
Collecting customer feedback regularly allows you to see the aspects of your customer experience journey that need to be improved.
Improving customer experience can have a big impact on your profits as your customers will be more satisfied and more loyal. In fact one study showed 84% of companies that worked on improving customer experience saw an improvement in their revenue, and 92% saw an increase in loyalty.
The importance of an excellent customer experience has been steadily increasing over the years. Whereas once it gave you the competitive edge, now it just keeps you in the running. In other words, you have to be constantly improving your customer experience to be successful.
Feedback shows you the specifics of what is happening in your customer journey so that you can tackle any issues at a granular level. This allows you to fix any weak links along your customer experience journey, and helps you stay ahead of the competition.
Strong customer retention is key for the health of your business and bottom line. Studies have shown that you’re 60-70% likely to sell to an existing customer but just 5-20% likely to sell to a new customer.
So, it makes sense to make your existing customers happy, and feedback is the perfect tool to tell you whether they are or not, and why.
When you know this you can put in place measures which increase loyalty and customer satisfaction, which we know has a direct impact on retention.
Word of mouth is an extremely powerful way to get new customers. You need your existing customers to be saying good things about you, and if they’re not, you need to put corrective measures in place.
Online reviews that people come across are also important forms of customer feedback and hold a lot of power. According to one study, 79% of consumers say they would put as much trust in an online review as they would with one from friends or family.
By continually monitoring this feedback you can put change in place that will change how people view your organization and help you get more referrals.
Customer feedback, when analyzed correctly can lead to a wealth of actionable insights. These can then help you to make better business decisions which lead to better outcomes for your customers.
What are actionable insights and how can they help your business? Basically they are any kind of information that is going to be useful in making meaningful changes. As the name suggests, they need to lead to action, and to do this they need to be relevant to your business goals, specific and clear.
Without going out and looking for or asking for customer feedback, these useful (potentially profit-creating) insights might never reach you.
There are a number of different ways you can collect feedback and it’s best to cover as many of them as possible to build up a strong idea of what you need to improve. Here are some you should consider:
This is a classic and effective way to collect feedback. You can cover a lot of bases with a survey. The classic customer feedback surveys are the Net Promoter Score (NPS), Customer Satisfaction (CSAT), and Customer Effort Score (CES), which we mentioned earlier.
The formats in which you send these out to your customers is also important.
Email is a common and effective way. Another good way to get specific feedback is to send the survey in-app while your customer is using your product or on your site following a touch point. Survey questions can also be asked over the phone and via the mail.
You should also consider the type of survey data you collect: quantitative or qualitative data.
That in turn will determine whether you ask close-ended or open-ended questions in your surveys.
Your live chat sessions with your customers are likely to be ripe with useful feedback. This is where your customers go to have their queries resolved and to let you know what is not working for them at the moment.
By reviewing these chat logs, you can start to pick up on any trends that are occurring so you can resolve issues. This will also result in less of a burden on your customer service team as less queries will need to be sent to them from your first chat bot filter.
Social media is a hotbed of both direct and indirect customer feedback. We’re all accustomed to the open dialog on social media and how easy it makes it to communicate with brands. It’s also a place where customers go to air frustrations about their interactions with brands.
By monitoring social media activity regarding your brand you can help customers who are experiencing frustrations and prevent a PR crisis from happening. You can also gain insights regarding your products from comments that customers leave on social media.
Speaking to your customers really is a great way to really get to know them. It isn’t always the most practical, and can require a lot of resources, for this reason you want to target just a small number of people.
However, interviewing your customers does return good results as you can dig further into customers' answers, hear the tone in their voice and really understand what they are saying.
A feedback form is the vehicle that transports your questions to your customers and it’s design can have a big impact on whether your customers complete it or not.
The great thing is that there are a lot of feedback form templates out there which are well designed and easy to customize. You can also create a form from scratch and design it using your company's branding and design style guide.
You can check out some examples of great feedback forms here.
Once you have created your feedback form it makes it more simple to send out. The uniformity of the form, together with well-devised questions will result in easy-to-complete surveys which return clean data. Having your data clean will then make the analysis step that much easier.
Your feedback might contain a goldmine of insights, but if you don’t sort and analyze it you might never know and all those insights could go to waste.
As we’ve seen, there are a myriad of ways that you can receive feedback, meaning you’re facing potentially huge data sets. This includes both numerical data that you get from closed-questions and the text data you get from open-ended questions. Processing large volumes of data (particularly the qualitative data you get from open-ended questions) can be difficult without the right tools in place.
For numerical data, like NPS scores, you can use tools like Excel to compare results from previous quarters, and create simple charts and graphs that give you an overview of how you’re performing from one quarter to the next.
Enter MonkeyLearn Studio (pictured below), which harnesses the power of AI to sort through your qualitative data using a variety of tools like sentiment analysis, topic analysis, and keyword extraction.
You can then slice and dice your data in the in-built data visualization dashboard, making it easy for everyone to understand text data, not just data experts.
Sharing insights across different teams helps to get everyone on the same page, and make it easier for everyone to work towards the same end goal.
Discover MonkeyLearn’s templates to analyze specific types of feedback, which process, analyze and visualize your data for immediate insights.
Customer feedback importance cannot be underestimated.
Whether you like it or not, customer feedback will define the trajectory your business takes. In order to steer your company toward more profit, you need satisfied, happy, and loyal customers. To know whether you have these kinds of customers, or to fix things if you don’t, you need feedback.
Then you need to effectively analyze that feedback.
Employing fast and effective analysis tools, like Excel and MonkeyLearn Studio, takes the struggle out of sorting through your customer feedback for insights.
Sign up today and see how you can transform your customer feedback into meaningful insights to help grow your business and increase your profits.
November 23rd, 2021