As a business, you’re always looking to improve your product and create a good and meaningful relationship with your customers. The more happy customers you have, the better. How can you do that, and keep them coming back for more? It all comes down to the customer feedback loop.
This is the process you’ll use to understand your customers’ experience, and make it better. How do you use the customer feedback loop to your advantage? Here’s what you need to know.
What’s The Customer Feedback Loop?
First of all, what is the customer feedback loop? Essentially the loop is the process of responding to customers when they review or otherwise leave feedback on your business.
Many businesses only successfully complete the loop by responding to negative reviews. They respond as they don’t want the customer to go away with a negative view of the business, so they look to make things better for them. For example, if they feel they were over charged for something, the business owner can offer them a refund.
However, as a business it’s actually better to respond to all customer reviews. The more you interact with customers, the more you’ll make an impression. That’s why it’s a good idea to set up a Google My Business page, where customers can leave reviews. This lends your business credibility online, and helps you get higher rankings in searches.
What does the customer feedback loop look like? It works like this:
Step One: Gather feedback from your customers. This can be through reviews, feedback forms, or other methods that are useful to your business.
Step Two: Now you have that data, you can then analyse it and see what customers are saying about you and your product. Use that to draw conclusions and create a better experience for customers.
Step Three: Now you have that knowledge, you can apply changes to your business and product. Customers will then see those changes, and hopefully leave feedback on them.
This is a loop, so if you’re using it right the system will begin again. No business is perfect, and the more you use it the better your product will be.
How To Close The Feedback Loop
Let’s consider that first example again. The customer wasn’t happy, so as a business owner you replied to the review and applied a fix to the issue at hand. This will help your SEO and impact online, as customers can see you care about the experience that your customers are having. However, this won’t close the customer feedback loop. How do you close it and get the best results?
When you’re looking to close the customer feedback loop, you want to show customers that their opinion has real, lasting change on the business. How you close that loop depends on how you talk to customers and gather data in the first step. However you do it, you should take the information they give you and act upon it. That way, you’ve closed the customer feedback loop for your business.
Why Create A Customer Feedback Loop?
This all sounds interesting, but why should you create a customer feedback loop for your business? We have hit on some of the reasons why you should create one. Reviews for your business can be left online, and you want to ensure they’re giving the best impression possible. When you reply to these messages, take their messages on board and implement them, then that shows would be customers that you’re listening and making changes that benefit them. That, in turn, helps you improve your leads and bring in new business all the time.
As well as this, you’re collecting valuable data on how your product is performing. ‘Customers should always be your first stop when looking for data about your product says process management expert Shereen Woodcock, from Boom Essays and Essayroo. ‘They will happily tell you where you’re succeeding, and where you aren’t. You should use that information to your advantage.’
With this in mind, you should start by creating your customer feedback loop. How do you do this?
Gaining Customer Feedback
To create the customer feedback loop, you first need some customer feedback. As mentioned earlier, if you’ve made sure to claim your business on online directories, such as Google My Business, then you’re all set and ready to go. If you haven’t though, start by making an account with services such as these. You’ll be able to claim your business, and handle any reviews that come through on it. There are lots of other benefits too, so it’s well worth doing.
Once you have those accounts in place, you’ll see reviews start to come in. Make sure you’re paying attention, and reply to messages that come in. Even if the review is a basic positive one, simply thanking them for their review will go a long way.
While this is a good way to collect data, it’s not the only way. You can also send out feedback forms to customers after they’ve made a purchase. This gives them the opportunity to go into detail about why they liked your product, and what can be improved.
One of the most popular ways to get feedback is to use the NPS system. This stands for Net Promoter Score, and is an easy way to gauge how a customer feels about a product. It’s used by a lot of businesses to create a customer feedback loop and put improvements in motion.
Using The NPS System
If you want to use the NPS system in your customer feedback loop, it’s easy to implement. You’ll ask your customers to rate the product they bought on a scale of 0 – 10, to show if they’d recommend your product to others. 0 – 6 are considered ‘detractors’, as they won’t recommend you. 7-8 is neutral, and 9-10 are considered ‘promoters’.
This gives you a numerical score that you can calculate, to see how customers feel about your product. All you have to do is subtract your total number of detractors from your total promoters. The higher that number is, the better.
Now you’ve started to create your customer feedback loop. Even better, you have several different categories of customer that you can engage with, and adjust your communications with accordingly to improve your results with them. Let’s see what the next step is.
Closing The Loop With Your Customers
Now you have that data, you can move onto step two of the customer feedback loop. You’ll analyse the data they have given you, and see what you can do to make improvements. You’ll then want to communicate with your customers to let them know that you’re taking action based on their comments. The way you’ll communicate with customers will depend on their data, so let’s see what that would look like:
Speaking with promoters: These are the customers who scored 9-10 on your NPS scoring system. If they’re scoring that high, they’re very likely loyal customers already, who feel very strongly about your product. As they’re happy with what you’re offering, it’s tempting to just thank them and then focus on the less happy customers. While you don’t need to improve on anything here, you can’t take them for granted.
The first step is to thank them for their response, but you can take it further. The most loyal customers can be given extras, such as merchandise. You can then ask them to refer them to others, as part of a referral program. You can also keep them in the loop, sending out personalised emails about what you’re working on next. This encourages them to keep coming back and buying with you.
Make sure you’re appreciating your promoters, and using their enthusiasm to wide your customer base. They’re more valuable than you know.
Speaking with neutral or passive customers: These are your customers who rated you a 7 or 8 when you asked for feedback. They are some of the most important customers in your customer feedback loop, as they are vulnerable to your competition. In this case, you want to show them that you’re the best, and why they should choose you again.
You want to give these customers more reasons to come back and buy from you. Many businesses choose to send out special offers via email, such as discounts and upgrades. These allow them to buy from you again with no risk, so you have another chance to show them how good you are. There’s also the option to send out guides about your product. If you have created ebooks about your business and products, sending one for free can go a long way.
Speaking with detractors: Now you’re dealing with those who rated you at a 6 or less. You need to consider these as unhappy customers. There are several reasons why they may not recommend you to others, and you need to see if you can put things right. This may not be pleasant, but their feedback is so useful as it shows you where you need to improve.
Usually, it’s quite clear how you should communicate with these customers. They will have voiced exactly what went wrong with the sale, so you can get in there and fix it. Whether it’s replacing a product, offering a refund or discount, or giving them the extra info they need, you can do this quite easily.
The key is to make sure you do this, every time. It does take time to handle complaints, but when you do so well, those customers will give you another chance.
Speaking with non respondents: There’s actually a fourth group here that you need to pay attention to, as they’re the largest. ‘When you send out a survey, around 20 – 40% of people will respond’ says Ryan Winters, a tech writer with Paper Fellows and State Of Writing. ‘You have a pool of 60 to 80% of your customers that you’re not even connecting with.’
Because of this, it’s important you make the effort to break the ice with them. It’s usually best to treat them like a passive customer, as they’re not currently swayed by your business one way or the other. Sending extra deals or info through email can encourage them to come back, and get involved by offering feedback.
You’ll never get a 100% feedback rate, but the more you encourage customers to get involved, the more valuable feedback you’ll get.
Start The Loop Again
You’ve completed the loop, with feedback from customers and the improvements you’ve made based on them. That’s great news, as you’ve now made your business better and created engagement online. However, you can’t stop there. It’s called a customer feedback loop for a reason, so you need to keep it going.
There’s always room for improvement, and that’s important if you want to be on top of your game. Periodically, you want to get in touch with your customers again and get that feedback about your products. Many choose to ask for it every time a customer buys something. That keeps that data coming in, which you can analyse and act on in real time.
The easiest way to do this is have an automatic email sent to the customer, a certain amount of time after they made a purchase. You may have seen these emails in your own inbox. Industry giants such as Amazon use this method to get feedback from customers, and you can too. If you want to do this, you can easily set up the emails with a tool like MailChimp.
Now you can see just how important the customer feedback loop is. When you’re looking to engage with customers, look at creating that loop. It helps you get a feel for what customers think of your product, and helps you make improvements. Plus, you’ll also get a great reputation online, as customers will see you responding to and handling reviews, good or bad.
Lauren Groff is a writer mostly specialising in process management for business. She writes for Essay Services and Academized, as well as Dissertation Writing.
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