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Customer Feedback | Why It’s Important & How To Collect It

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Ask For Customer Feedback

08 Sep Customer Feedback | Why It’s Important & How To Collect It

Posted at 10:00h in customer service by
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Customer feedback is information customers provide about their experience with you. It can take different forms and examples of customer feedback range from star ratings, customer reviews, and chat interactions to email messages, social media comments, and face-to-face conversations between customers and employees.

Sometimes, customer feedback will tell you what went right and what they loved about the experience. Sometimes, it will tell you precisely what is wrong and suggest a solution. And at other times, it can take more work through other data collection techniques to understand what your customers are telling you so that you can translate the information into action.

Customer Feedback

Why is customer feedback important?

Customer feedback is crucial for knowing what your customers do and don’t like and what you can do about it to improve your business. After all, how can you keep your customers happy if you don’t know how they feel about your brand? Customer feedback provides valuable and reliable insights your business can use to continuously improve your offerings and customer experience. It’s also a valuable resource for fostering a customer-centric mindset, improving the customer experience, and improving your business. Here are some of the reasons customer feedback is so valuable:

It helps improve products and services.

When you introduce a new product, service, or brand to the market, you probably have an idea about your customers’ needs. Market research can confirm if potential customers would be willing to buy it, and it can also give you tips on improving it and selling it. However, only after your customers use your product or service can you learn about its advantages, flaws, and their actual experience. Additionally, their needs and expectations may evolve over time. You might have the best expertise in the industry in which your company operates, but customers’ opinions can help you ensure the end product will meet their expectations, solve their problems, and fulfil their needs.

It helps you measure customer satisfaction.

Customer satisfaction and loyalty are crucial to a company’s financial performance, and are linked to many benefits, including lower costs, higher revenue and increased market share. The best way to determine these is to get your customers’ opinions. Rating-based questions are ideal for this as the methodology is straightforward, can be targeted, and is universal, so virtually every business can apply it in their customer satisfaction management strategies.

It shows you value customers’ opinions.

By asking for feedback from a customer, you are communicated that their opinion is important to you. This is a valuable way of gaining brand ambassadors who will be your advocates. It also shows you are here for them and not vice versa. It puts the customer at the forefront, as they will believe that your primary goal is to solve their problems and fulfil their needs, not just take their money.

It helps you create the best customer experience.

Today’s marketing heavily depends on people’s experiences with brands, products, and services. Clients will stay loyal to your brand if you focus on providing the best customer experience at every touchpoint. The most effective way to give them a fantastic experience is to ask them what they like about your business, and what can be improved.

It assists with improving customer retention.

A happy customer will stay. An unhappy one will eventually find a better alternative to your business. Customer feedback benefits are significant and obtaining it is a simple way of determining if your clients or customers are satisfied or if there are areas you can improve.

It’s a reliable source of information to others.

Opinions, testimonials and referrals from other customers who have already used a product or service can be very powerful. Many companies today incorporate review systems in their services and products, as customer feedback is as essential to your business as it is to other customers.

It can enhance employee experiences.

There is an established link between CX (customer experience) and EX (employee experience). Happier, engaged employees can result in happier customers, but customer feedback can also benefit employees. It can provide the basis for training and career development, highlighting areas for improvement in how employees offer service. It can highlight outdated policies or systems that prevent employees from helping customers. And it can also generate ideas for new processes or approaches. It can also create value for employees who work face-to-face with customers. When an employee receives feedback and is empowered to act on it, they can feel a sense of connection to customers and a greater sense of satisfaction knowing they are performing well in their role.

It gives you data that helps you make business decisions.

Successful business owners gather and manage data that can help them develop future strategies. Customer feedback is one of the most reliable sources of tangible data that can be used for business decisions.

How to collect customer feedback

customer feedback - how to collect

Customer feedback can be gathered via a variety of channels:

Email

Reaching customers via their inboxes is a cost-effective, trusted and familiar way to gather customer feedback. Most people have an email account that is regularly checked, so your reach potential could be substantial. Customers will be used to receiving feedback requests, so they should feel comfortable about engaging if they choose to. They will also feel confident in replying if they recognise the email as trusted and if it relates to a purchase they can remember making.

SMS

Like email, a lot of people use SMS as a communication channel. It is low-cost, simple to implement and ideal for collecting small amounts of feedback at a time.

Social media and review sites

One in three consumers opt to share their concerns over social media instead of email and phone support. Hence, more and more businesses are now using its metrics and capacity for measurement to their advantage. And while SMS provides an active response to a direct question (for example, how satisfied are you with your recent purchase?), review sites and social media channels like Facebook and Twitter can help you indirectly gather customer feedback, without a question being asked.

Website feedback

There are a few ways to ask customers for feedback on your website. A feedback tab will allow customers to quickly answer a short survey without interrupting their browser journey. A dedicated page on your site is great for general feedback or to act as a landing page for an email survey link.

Interviewing and focus groups

When you need qualitative, in-depth feedback, one-on-one interviews with a researcher can be valuable. Although they can be labour-intensive and only reach a relatively small number of people, they can help you validate hypotheses and observations you’ve made based on data from a broader population. They can also help with gaining an understanding of the complete customer experience. Focus groups offer similar benefits and are likely to be more structured and in-depth, as they are typically led by a moderator. You will benefit from multiple points of view, and may uncover more profound data thanks to debate and discussion between participants.

When to ask for customer feedback

In terms of when to ask for customer feedback, it’s essential to determine your goals to ensure you are getting the data you need. Typically, there are three optimal periods to collect customer feedback:

Post-purchase evaluation

This is feedback from an individual customer at the time (or soon after) a product or service is delivered. Its goal is generally to cement a long-term relationship with that customer.

Periodic satisfaction surveys

These provide period-specific (like annual) feedback from different customer segments and can offer snapshots of customer expectations and experiences.

Continuous satisfaction

Regular post-purchase surveys (daily, monthly, quarterly) can assure a high level of quality over time. It can also help you capture feedback over the entire customer lifecycle so you can monitor how the customer’s experience is performing. It is also important that you respect your customer’s time and don’t over-ask questions. Keep it concise and to the point as this will increase your response rates. Research shows a 30-50% reduction in response rate for every question asked after the first 2 or 3 questions. The same research shows one reminder sent 3-7 days after the initial survey can boost your response rate by up to 15%. But if you’re bombarding your customers with daily reminders, you’re overdoing it.

Customer feedback – creating a continuous feedback loop

Ongoing feedback is necessary for monitoring your business and products or services over an extended timeframe. Creating a continuous customer feedback loop will allow you to check in with your customers and determine how things have improved and what still needs attention. The ‘loop’ refers to the circular process of gathering feedback, acting on what you’ve learned, and then asking for feedback again. Because the journey is circular, it describes an ongoing process that never really ends but should result in continuous improvement. The main components of the loop are:

Gather

This stage is about gathering as much customer feedback as possible and interpreting through the question of “How can we improve?”

Segment

New customers will probably have a different experience from long-term ones. Customers in different locations will probably also deal with different customer support teams. That’s why it’s essential to be able to segment your feedback into groups, and then analyse it to tell a consistent story.

Analyse

In this stage, you are looking for new information and seeing how things have changed since your last feedback round. This is where you ask several questions, including “What are your customers saying about their experience?”, “Were they happy?”, “Did they feel disappointed?”, and “Were there any areas of friction along the buyer journey?”

Act

Using the information proactively is vital, so at this stage in the customer feedback loop, you need to ensure the customer feels listened to by making changes that can address their issues or streamline the process. This stage is also not the end; it’s continuous because ongoing improvement is a cyclical endeavour.

Why is the customer feedback loop important?

Implementing a customer feedback loop can help your business drive positive change within your organisation’s key processes, including:

Identifying hidden issues

Harnessing feedback can sometimes be a vital reality check. People outside your business who buy and use your products or services can provide a truly objective opinion on how things operate. Often they’ll point out pain points that people within your organisation can overlook.

Reducing customer churn

Fixing issues that you know customers are dealing with can stop you from losing them and enhance their loyalty. “Customer churn” is directly influenced by how satisfied customers are with the buying process, your product or service quality, and the kind of after-sales support you offer.

How can it benefit my organisation?

A clearly defined and well-executed customer feedback program can help your organisation:

  • Share customer feedback data with the right people, at the right time, and in the right way.
  • Track progress against key operational and customer experience targets.
  • Identify friction points, understand customer behaviour, and prioritise the key drivers of satisfaction.
  • Coach teams with data and real-time metrics.
  • Predict customer behaviour and drive customer loyalty.
  • Allow employees to improve and set personal goals.
  • Create standards that hold everyone accountable.

Closing the loop with customers

It is crucial that you follow up with customers when they initiate a complaint or a question. This is known as closed-loop feedback, and it is “best practice” to ensure that no customer is forgotten. By following up with unhappy customers, your team can work together to resolve issues quickly and turn detractors into loyal promoters. Closing the loop can turn negative experiences into positive ones, and unhappy customers can be covered with the right approach. This process can look different for different parts of your customer base. For example, high-value customers might receive a personal contact, whereas lower-commitment customers may be happy with automated contact.

Customer feedback ultimately helps you improve your customer experience to increase brand loyalty and improve your bottom line. Learn more about putting your customer first with customer experience training from CX Training.

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