4 Steps for a Foolproof Customer Feedback Loop to Better ROI

Vying against competitors by offering lower prices or creating attractive ads may have worked for companies in the past. But in today’s world of cynicism and social media, this dynamic has shifted entirely. Customers are inundated with ads wherever they go and have become desensitized to more traditional marketing approaches.

The top draw for customers today is all about the experience. An organization with a reputation for good customer experience can quickly receive free advertising as word spreads through social media. This state of affairs has made it essential for organizations to listen to customer feedback to enhance customer experience and adjust and improve products, making it a critical part of the product lifecycle. 45.9% of companies report that customer feedback is their top priority, putting it above pricing and product.  

What is the Customer Feedback Loop?

Collecting customer feedback is one thing, but interpreting, understanding, and implementing the feedback is the next level. This process ensures that all qualitative feedback collected adds value to your product and organization. The unique insights you gain from this strategy and tools enable you to adapt your product to really meet your customers’ needs, which can have a huge impact on your organization’s ROI and bottom line. 

Analyzing customer feedback to gain actionable insights is a massive and challenging task. A customer feedback loop is a strategy that organizations can implement to manage and gather customer feedback efficiently. Implementing the customer feedback loop strategy means that no input is ignored, and any collected feedback is analyzed, weighed up, and often implemented by the organization, thereby closing the loop. The loop is a continuous journey of collecting positive and negative feedback from customers and responding to their queries by improving products, services, or the customer experience.

The ACAF Customers Feedback Loop

Why is the Customer Feedback Loop Important?

Understanding your customers’ experience is critical for any organization looking to enhance its services, grow its customer base, and retain existing customers. Implementing a feedback loop ensures no feedback goes ignored and shows your customers that you value them and take their input into account. Customer feedback also plays a critical role in the product development lifecycle. By ensuring you consider all customer feedback, you can better understand your customers’ needs and how they experience your product.

These insights can help your teams make smarter decisions about their product features, feature requests, and prioritization and offer ideas for new features that should be added or new products customers would like to see in the future. They can also serve as product testing, validating what features should be adopted and identifying areas for potential improvement.

How Customer Feedback can improve ROI?

Customer feedback isn’t only beneficial to the product and future customer experience. Implementing a feedback strategy gives stakeholders at all levels valuable insights into the product they’re building. Having the opportunity to hear directly from the source what your customers do and don’t want and would like to see in the future is an invaluable opportunity. You can then add features and improvements to your product that you already know have existing demand. Tailoring your product specifically to meet your customers’ needs will naturally create a more successful product and increase company ROI.

Additionally, when errors or potential features are only identified at later stages of the product development lifecycle, implementation can be extremely costly. Companies can avoid this by paying close attention to customer feedback early in the product development cycle. The initial investment into customer feedback can result in significant savings. It enables your organization to add new and valuable features to your product and make your customers feel heard, which increases their desire to engage with your organization and product. Bain & Co. reported that collecting and implementing customer feedback can increase profits from 25% to 95%. 

 

Reasons why companies listen more

4 Steps for a Foolproof Customer Feedback Loop

Building a successful customer feedback loop requires four essential steps.

1. Collect data

Most customers won’t volunteer information unless asked for it, so requesting user feedback helps build customer rapport. Using customer surveys or encouraging users to get in touch through your organization’s site are a few ways you can receive direct and honest feedback. 

You can use surveys to analyze your customers’ overall satisfaction, including NPS (Net Promoter Score), which measures the likelihood of a user recommending your product to other people. Other methods include sending users customer satisfaction (CSAT) surveys or simply relying on user chats and social listening. 

Data collection methods

The more data you collect, the more insight you have into your customers’ current satisfaction levels and wishes for the future. Having deeper and more specific data rather than simple positive or negative scores allows you to really understand what your customers want and improve your product. Tools like Tagado can help you collect and aggregate data from existing public and private sources that are already being used by the organization, making the data collection more enriched and straightforward.

2. Analyze data

Knowing what your customers think is useless without actionable insights. To begin analyzing the data you’ve collected, you first need to categorize it. You can organize it into marketing, product, and service feedback or divide it into useful and less valuable data. The best solution is to create categories that best suit your organization’s needs. Once you have divided the data into broad categories, you can break it into sub-categories and identify patterns.

What is a repeat complaint among your customers? Is it a specific product feature? Is it a lack of support? Pricing? Or maybe it’s a bug in your software. After identifying these pain points, you can present them clearly in graphs or charts and hand them off to your product team, who can use these insights to adapt and evolve the product to meet customers’ needs better.

This process may seem straightforward but transforming vast quantities of raw data into actionable insights is challenging. The most significant data analysis challenge is the difficulty of collecting data and the lack of visibility across all data sources, which adds an extra and unnecessary layer of difficulty to the process. 

Ideally, you’d like to make the data and categorization process seamless as possible by viewing all data on a single platform. Innovative tools like Tagado allow you to quickly identify and act on patterns in your data, improve your team’s productivity, and address customer concerns by collecting your data across platforms and presenting it on one platform. It’s focused not only on the quantitative data but also the qualitative data, adding value to your customer feedback loop and, in turn, impacting ROI.

Customer feedback data analysis

3. Apply the feedback

Once you have identified the main pain points your customers face, it’s time to take action and prioritize your customers’ primary concerns. Your organization’s teams need to be aware of your collected feedback, not just product teams. Marketing, engineering, and other departments will all play a role, as product feedback can help give teams across your organization clear guidelines on where to improve, what customers want, and what tasks to prioritize. Feedback serves as a driving force behind many organizational decisions.

Every piece of feedback you collect needs to be included in your roadmap so your teams know their next steps and how urgent each task is. Every task is essential. Smaller issues such as minor bugs in the system may only need a quick fix by the engineering team. In contrast, others require a brand-new configuration of a product feature, but having tasks of all sizes and priorities on the roadmap facilitates the process and ensures your team gets to handle every issue. Additionally, it guarantees that no feedback goes to waste or is overlooked and that you continuously consider opportunities to add new features and improvements.

4. Follow up with customers

Your customers will appreciate having their insights heard and feedback taken on board. Studies show that 88% of US consumers want to engage with organizations that strive to meet their needs. You can show your customers their concerns are being heard and dealt with by directly messaging them, sending out an email, or publicly announcing it on social media, depending on which platforms your organization uses and your customers’ preferences. Many companies send out email blasts telling their customers of new features created because they listened to customer feedback – this is a great way to let them know you’re listening while also giving them the latest news updates, and an incentive to engage or invest in your product further. 

Customer Feedback Loops can be easy

An effective customer feedback loop is critical for product development, but it can quickly become overwhelming. Manually sifting through hundreds of data sources and customer complaints takes time. Deciphering what it means, how important it is, and its impact adds another step. Tools like Tagado can help your company streamline the customer feedback process by collecting qualitative data from various external and internal sources, allowing you to understand your customers better, gain deeper insights, quickly identify and address patterns and influence your overall ROI. 

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