Feedback is the key component of any successful business. According to Forbes, customer-centric companies that collect and act on client feedback are 60% more profitable than companies that don’t. To ensure that you hear and act on your customer’s feedback, you need to put a closed feedback loop system in place.
This article will take you through the five easy steps and best practices you must follow to build that system and drive business growth.
A closed feedback loop is a system that uses client feedback to adjust products to become a better fit for the end customer.
It is used to maintain desired performance levels, optimize performance, and ensure stability. It functions based on output analysis and the constant tweaking of inputs to obtain the best possible results.
In a closed feedback loop, what comes out of the system is constantly monitored, and the feedback received is used to change what goes into it.
Closing the feedback loop refers to the process of collecting feedback from customers, analyzing that feedback, and then taking action based on it to improve the customer experience. Implementing this process effectively can result in lower customer churn rates, optimized customer experiences, and other benefits for any business.
There are multiple benefits to closing the feedback loop, but the most important are:
Closing the feedback loop reinforces your brand’s commitment to customer satisfaction. Companies that actively seek out and respond to customer feedback are deemed more trustworthy and tend to gain more loyal customers, which, over time, significantly reduces churn rates.
Constantly tweaking your product based on recent customer feedback optimizes customer experiences and decreases customers’ likelihood of choosing the competition over you. It also helps develop new products and services based on a continuous analysis of collected customer feedback.
When you set out to better meet customer needs, you show customers that their feedback is valued. This helps build trust between the client and your company, leading to increased loyalty, an improved brand reputation, and much lower chances of customers switching to the competition.
When you focus on providing clients with the products/services they want, you can afford to charge more and are rarely faced with the issue of unsold inventories.
It’s also much cheaper to keep current customers happy than to find new ones. In other words, closing the feedback loop is much more profitable for you and your clients.
Another major advantage of the closed feedback loop that translates into higher profits is the innovative side of the package. The product development phase is where you’ll best be able to see how the closed feedback loop works and where major product changes occur.
Try focusing on anticipating your customers’ needs rather than simply fulfilling them. Most clients don’t know what they want until you offer it; this is where innovation comes in.
As your product evolves, beta testers report feedback on their experience, enabling you to make necessary adjustments. This results in a better product and, over time, increased revenue.
Let’s see how you can implement a closed feedback loop, which channels you should use, and how to evenly distribute your team’s effort:
Here’s how to achieve that with little or no hassle:
All of the above can be done by setting up an automated email or chatbot to respond to customer feedback instantly and ensuring that your customer service team follows up with the desired solution.
An example is provided by Pela Case, a sustainable phone case company that offers eco-friendly cases made from plant-based materials. They are known for their exceptional customer service and commitment to sustainability and have put in place a dedicated customer service team that responds to all customer inquiries within 24 hours. Their support network includes email, social media, and their website’s live chat feature.
To reach many customers in a limited period, use multiple channels and platforms to gather customer feedback and get access to a broader audience.
You can use cost-effective tools like surveys, polls, and reviews to gather your desired information. Airbnb does a great job of using multiple platforms for feedback collection. These include their website, mobile app, email, and social media channels.
Repeating issues and patterns tell you everything you need to know to improve the shopping experience: they disclose potential missing links in the delivery process, customer service areas that could be improved, and product features you need to consider and potentially implement.
Collect data from every customer touchpoint, then see which issues clients signal most often. Touchpoint offers a comprehensive, 360-degree view of the customer journey, providing detailed info about each time a customer comes into contact with your brand so that you don’t have to manually search for customer info. It’s all there, under one dashboard.
Complaints sum up the most urgent and pressing issues that customers face. Responding quickly and effectively to every complaint can help prevent customers from becoming frustrated or angry.
Additionally, addressing complaints can help businesses identify areas for improvement and ultimately enhance the overall customer experience.
To prioritize complaints effectively, businesses should have a clear system for tracking and addressing customer feedback. This might include using a dedicated email address, feedback form, or social media channel for customers to submit complaints.
It’s also important to respond promptly to complaints, acknowledging the customer’s concerns and providing a timeline for resolution. Ideally, businesses should aim to resolve complaints within 24-48 hours or at the very least, provide a status update to the customer within that time frame.
The key to creating a closed feedback loop is obtaining detailed customer feedback you can act on immediately. This is how customer-centric businesses are run. The system works so well because it is based on optimizing the customer experience across every channel.
Your customer support system is an important part of the customer journey, but the customer experience goes way beyond support nowadays. Every contact a client makes with your brand is a potential source of feedback, so you need to review every customer interaction and even create new ones. This is where your entire team should get involved: PR specialist, social media wiz, and even HR representative. Every platform your team members use is a potential source of feedback.
Focus groups and interviews are great ways to collect extensive feedback. Social media helps detect issues early on before they turn into big problems, and it also anticipates customer needs. 59% of people have a more favorable opinion of a brand if they promptly respond on social media.
Collect feedback from multiple sources (live chat, surveys, social media, etc.), then ask the right questions to get the extra needed information.
Open questions like “What else could we have done to improve your experience?” show you care and offer more actionable insights about the shopping experience.
Provide incentives for every feedback you obtain to get more customers to share their experiences with your brand.
Include brief surveys in your emails so you can gather feedback more effectively. Here are the most popular surveys to consider:
When you need to let clients know that you have received their feedback and are taking active steps to improve, do the following:
Make clients feel heard and valued for submitting their feedback. Respond to their comments, and don’t leave out the negative ones.
Prioritize feedback based on importance and impact to ensure critical issues are addressed first. Negative feedback often comes first because it could signal a recurring issue requiring immediate action.
Be quick to respond, even though you are not ready to implement solutions. Ensure customers feel heard, analyze issues thoroughly, and then come up with the right solution. 79% of consumers expect brands to reach out within the first 24 hours after sending a message or posting a comment on social media.
Implement useful solutions addressing feedback to improve the user experience. If your customers have issues with your product or service, try to develop new features. If they complain about extensive queue times in customer service, train your agents to deal with things faster.
Get back to your clients and tell them you have taken active steps to address their feedback. You can do this via email, social media, or other channels. Acknowledge their contributions by posting their suggestions on your website or social media.
Online reviews influence 90% of customer decisions, according to a study by Dimensional Research. This shows the crucial role feedback plays in the customer journey and reinforces the idea that every information your customers provide should be used to improve your product.
Businesses implementing closed feedback loop systems are more likely to succeed in today’s competitive market. By actively listening to their customers and continuously improving their products or services, they can create a loyal customer base and drive growth and expansion.
Raluca Mocanu is a copywriter at Touchpoint and began her content writing journey in 2016. She loves traveling, reading, on-stage drama and recently discovered a deep interest in psychology.
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