The Value of Customer Feedback
Why It Is So Important for Businesses Today
Customer feedback is essential for businesses to discover what consumers think of their company, product, or service. If companies can successfully identify what their customers find important, they can react faster, more flexibly, and more effectively to both changes in the market, and customer expectations and needs.
Let’s imagine the following scenario: Max has invited his friends over for dinner. After work, he pops into the supermarket on the corner to get all the ingredients he needs: cheese, fish, bread, some olives, and two bottles of wine. Once back at home, Max sets the table, puts the wine in the fridge, and looks forward to a delicious dinner. When his friends arrive, they are surprised at his choice of food, and the general mood sinks. His friend Peter is vegan, Clive has a gluten intolerance, and Frank has not been drinking alcohol for a few weeks. Quickly checking with his guests about their likes and dislikes could have avoided all this disappointment. It would also have shown his friends that their well-being is important to him.
What is true for Max and his guests is also important for companies and their customers: market and customer requirements are subject to constant change. Customer feedback is therefore essential to find out what customers think about a company, its products or its services, what they like, or what they dislike. Whether customers or guests: those who are satisfied are happy to come back. Actively requesting customer feedback is therefore also an efficient way of retaining customers.
5 Effective Ways to Collect Customer Feedback
Nowadays, anyone who wants to buy a new product or use a service has many ways to find out about it in advance. This could be on social networks, forums or review portals. Existing customers’ praise or criticism can influence a company, its potential customers, and their satisfaction. The majority of customers then read the feedback and product reviews of other consumers before making purchasing decisions. Recommendations from friends and acquaintances can also convince undecided customers to buy. Just like the saying “The early bird catches the worm”, it is now a force of habit for many companies to obtain feedback directly, before customer’s opinions are shared with others in public. This way, they can collect valuable input from their customers and thus get one step ahead of their competitors. Yet, it is often a long journey to get there. Even with a large customer base, not all customers are ready or prepared to express praise and complaints. Often the customer responses differ in their quality and length. As with gold mining, it is important to take a close look at the feedback and separate the qualitative good from the bad. The following options are particularly effective for collecting customer feedback:
Corporate pop-up events are growing in popularity. They offer customers space where they can emotionally perceive the company, their brands, or their products. Companies can use these events to get meaningful insights about their customers and their business. Attendees at pop-up events are often very engaged and interested in the company or product making them first-class feedback providers. At the same time, pop-up events create proximity to the customer: companies meet their customers face-to-face in a natural environment. You can ask questions, write down opinions, and ask for suggestions about what needs to be improved.
2. Customer surveys
The KISS principle (Keep It Short and Sweet) wins out here: gaining customer feedback does not always have to involve complicated and lengthy market research. Customer surveys can take place via software, email, website, or social media. A simple survey on Twitter, Facebook, or a short survey by email or in a customer newsletter can be created quickly and costs few resources. A look at the stars awarded on an online rating system is often enough to estimate roughly where you stand.
3. Feedback by email & phone
Why not pick up the phone and ask the customer directly? Challenges and problems can be discussed directly and personally on the phone. Companies can also inquire about features that may be of interest to their buyers. Alternatively, you can replace a call with an email with a personal message. The shorter the email, the more likely the customer is to respond to it. If possible, companies should only ask one question and avoid using marketing terms and empty phrases.
4. On-Site and In-App Feedback
Customers who already use a product or a service provided by the company can often provide particularly valuable suggestions. They have already engaged with it and can therefore provide detailed information on its quality. Analysis tools such as Google Analytics or Kissmetrics can then help evaluate the answers. Those who want to offer their customers an additional service can integrate the feedback software directly into their web applications, websites, and other software products. Customers can easily leave their praise or their complaints in real-time.
5. Usability Tests
Usability tests are a good way of checking the usability of software or a product with potential users. They can be carried out during any project phase. In this way, companies receive feedback on initial ideas, mockups, prototypes, or finished products. Even if usability tests are a very expensive form of a survey, they often provide the best and most comprehensive kind of feedback a company can receive.
What You Can Use Customer Feedback for
Collecting a huge amount of data itself does not promise success by any means. This is because the quality of the data and the insights gained from it are the things that really count. Companies that take a closer look at their feedback can use it to set success promising impulses:
1. Polish the Corporate Image
True to the saying “Do good and talk about it”, companies can use positive feedback for their public relations work and thus, increase their awareness. Positive feedback can be published on the website, in flyers or in the company magazine. What improvements or innovations has the customer complaint brought with it? In a more exclusive feature, proponents can report on strikingly positive experiences with the company or the product. This makes testimonials and good references additional pluses for customer feedback—however, you have to get consent before you publish them.
2. Increase Customer Retention
Communication is interactive and not a one-sided matter. Customer feedback opens the door for companies to enter into dialogue with their customers. Together, weak points can be tracked down and improved. Anyone who asks for feedback displays customer appreciation. Companies not only gain valuable information but also convey a customer-oriented attitude—and by taking the complaints of their critics seriously and trying to find a solution, they create trust. Customers feel that their concerns are being seen and listened to. Once the problem or challenge has been mastered, customers who are initially dissatisfied often report positively about the process. In this way, customer retention can be increased and long-term advocates and fans can be won from initial critics
3. Optimize Processes
No matter if it is a praise or complaint: customer feedback often contains information about what is already running smoothly and where there is still a problem. Customer complaints should be welcomed, as they can help you identify errors and problems more quickly. Finally, companies can use the information gained to optimize internal processes, business areas, and product features.
4. Create Innovations
Why not use your customers as a source of ideas for new sales channels, processes, and products? Customers who share their needs and expectations with the company can set the next innovative steps in motion. This is because their feedback often contains not only ideas for improvement but even hidden hints for completely new developments.
5. Strategically Align the Company
valuable information for the strategic direction of a company. Positive feedback can strengthen companies in their decisions. Complaints can help you minimize and restrict mistakes. If major changes or fundamental business decisions are pending, customer feedback can support the decision-making process. The risk of a wrong decision can thus be minimized and the probability of a largely positive acceptance among customers can be ensured. At the same time, customer feedback can also initiate a change of direction in the company.
6. Improve Crisis Management
Possible crises in the company are often indicated a long time in advance. Companies that are regularly on the lookout for feedback often have a better sense of possible conflict issues and weak points. This gives them the opportunity to react faster and defuse impending crises earlier.