The Customer Feedback Loop is a process of enhancement for your products and services based on the feedback customers give you.
It allows you to implement change according to what your customers have to say. This is one of the best ways to improve your company in an efficient and meaningful way.
More specifically, a Closed Feedback Loop is when you follow up with the customers and show them how their opinions have impacted your business decisions. This shows them that they’re valued by your business, which in turn can mean more conversions and long-term sustainability for you.
But for many companies, the struggle lies in how to gather customer feedback. Moreover, how do you translate data into actions?
In this step-by-step guide we’ll show you how to establish an effective Feedback Loop, how to manage negative customer feedback, and how to close the feedback loop.
How to Create a Closed Feedback Loop?
“It’s good to have the close-the-loop as a step in a Customer Experience program: it means to aim at actionability rather than simply at measurement.”
Adriana Piazza, Chief Customer Officer at SandIV Switzerland
The first thing to keep in mind about the customer feedback loop is to ask for customer feedback.
What sort of feedback do you want? What feedback can be used for product development?
The most popular and manageable way to start with customer feedback is Net Promoter Score (NPS). NPS measures customer experience and provides a quantitative indicator for customer satisfaction.
How NPS works is you ask the customers to give a rating from 0-10 on the likelihood that they will recommend your product or service. The rating signifies if the customer is a promoter, a passive, or a detractor.
You can then calculate your Net Promoter Score by subtracting the number of detractors from the number of promoters. The score would be between -100 to +100.
Why should you use NPS?
Despite how simple Net Promoter Score feedback seems, it can uncover insights that help you reduce customer churn, nurture customer loyalty, and improve customer experience.
You can also use NPS as an opportunity to gather further qualitative feedback.
You should follow up with open-ended questions. The first question you should ask your customers is why they gave that specific score.
“What is the primary reason for your score?”
Simple questions like these can help you really start to understand the context of your customer feedback and gain information to make improvements.
How to Close the Feedback Loop with NPS?
The three types of Net Promoter Scores indicate different levels of customer satisfaction. How you should take actions on their feedback and show them your commitment is likewise different.
The actions you take for different levels of satisfaction will also be different. If someone is perfectly satisfied, then you might not want to take any action at all other than thanking them. If a customer’s satisfaction level is lower, however, you’ll want to take a higher sense of action.
Here we want to share some strategies on how to analyze NPS and close the feedback loop.
Closed-Loop Feedback With Promoters
Promoters, which are customers that give you a 9 or 10 rating, are the group that like your business and are generally satisfied and loyal. They can also be advocates for your business.
You already have a somewhat strong relationship with them and they have provided references, testimonials, reviews, and so on for your brand. Don’t take them for granted. Show gratitude and take time to nurture your promoters.
Here are some tips on closing the loop with your promoters:
- Give them rewards – thank you emails, merchandise and so on.
- Ask for referrals – they will be happy to recommend your brand, especially if you offer free credits.
- Give personalized updates – see what they like and then show them the potential benefits of enrolling.
Feedback Loop and Passives
Passives are the second tier in an NPS score. They’re customers that rated your business a 7 or 8 when asked how likely they are to recommend your service to others.
These customers have tried your product and were satisfied, but they aren’t enthusiastic about it. They are somewhat ambivalent towards your product.
This is precisely what makes them so vulnerable to competition and what might make them churn.
They recognize that they need your type of product but they are not sure that your product is the best out there.
This is an opportunity for you to show them that you are, in fact, the best. It might be a bit difficult to close the feedback loop with them because they don’t tend to provide much feedback at all.
Zendesk says that only 37% of the passive cluster share feedback. They churn and you lose the chance to turn them into engaged customers.
So, to close the feedback loop with them, you need to:
- Offer discounts and upgrades – give them exclusive discounts, subscriptions and zero-risk upgrades.
- Send guides – they might not know how to use your product properly so you should send guides and help them learn more about what you have to offer.
Closed Feedback Loop and Detractors
Detractors are essentially unhappy customers.
Dealing with them will be less than pleasant.
But, these are also the customers that can bring you the most benefits because they often have tangible and detailed complaints on your product that can help you improve it.
Changing their mind is all about admitting your mistakes and showing them how and when you plan to fix them.
According to research done by Lee Resources, 70% of customers will do business with you again if you fix an issue they’ve complained about.
The purpose of closing the feedback loop with them is to build trust and show them that you are a good business with a lot to offer. Even if they don’t purchase from you again, the positive interaction can generate good faith in prospective customers.
“There is no failure. Only feedback.”
If you do your job well, these customers can become your future Promoters.
One of the most effective ways to engage with detractors is to send a personalized email and ask them about their issues and how they think you should resolve them.
Ask questions like:
- What is it that you wanted to do with our product, but couldn’t?
- Can you outline the solution you want to see?
- What is the first thing you would change about our product?
Calling them or conducting a customer interview are solid options as well. It gives that human contact and allows for deeper questioning.
The idea is that you should improve the perception of the brand by solving their biggest issues.
Some other things you can do for detractors to change their perspectives are:
- Give them an extensive product guide, in case they need something you are already offering.
- Extension of the free trial plus some premium features.
- Suggesting a service that would work for them, even if it’s not within your product.
- Share upcoming plans and product features, they will probably stick around!
How To Close The Loop With Non-Respondents
Most businesses have a framework in place for the three groups mentioned. But they often overlook the largest pool of customers: Non-respondents.
For example, the NPS response rate is around 20-40%. This means that ignoring the non-responders would mean ignoring 60-80% of your market, which is not a good idea.
Non-respondents are hard to convince, though.
The best way to re-engage with them is to treat them like Detractors or Passives. Try to break the ice. Non-respondents are usually not affecting your business but there is a potential for future growth in this market as well.
Close The Customer Feedback Loop With Usersnap’s Reply-To-Customer Feature
Usersnap’s feedback tool can be easily implemented on your website or web app allowing you to capitalize on NPS. It gives your customers the chance to let you know if they would recommend your service, explain why or why not, and provide you with their email for further discussion.
From the customers’ end, this is all done by filling in a simple pop-up on your website. From your end, however, this is an incredibly powerful tool packed with data and analytics. It allows you to follow up with your customers and always close the customer feedback loop.
You Can Use Usersnap With Ease
You can place Usersnap’s widget as a button on the side of your website or trigger it to show only on specific pages and to a specific group of audience.
Once your customer activates the Usersnap widget, a pop-up appears to your customers and asks for 3 pieces of information.
- They can rate the likelihood that they would recommend your business on a scale of 0 to 10
- Give a comment on why they chose the rating they picked
- Provide you with their email address.
After they’re finished, the widget sends this feedback to your Usersnap project immediately, along with details like the customer’s location, time, and browser data.
Screenshots can be attached to feedback as well with annotations from the customer, allowing businesses to see exactly where the customer’s issue lies.
You’ll receive a notification that new feedback has been sent to you through Usersnap. From the Usersnap Inbox dashboard you can reply to customers that provide you with their email address. Your comments will be emailed to them immediately from the Usersnap feedback tool.
Any emails they send back are forwarded to your Usersnap Inbox, allowing you to have a complete conversation with them through Usersnap’s dashboard. You can even add emojis to the conversation to keep things friendly and fun.
After a ticket has been resolved, you can mark it as complete in your project. Not only are you closing all of your customer feedback loops, but you can keep track of your feedback loop history as well.
Benefits Of Usersnap’s Reply-To-Customer Feature
Usersnap’s feedback tool starts at just $9/month for one project with unlimited feedback tickets. You can start with a 15-day free trial as well, giving you all of the following benefits for free:
- Easily get in touch with your customers
- Thank customers for positive feedback
- Address issues from critical feedback quickly and professionally
- Keep track of your feedback history
- Manage and reply to all of your customer feedback from one inbox
The Ultimate Goal: Feedback Loop For Product Development
Adriana Piazza from SandSIV+, a superior customer intelligence analytics company, said it’s good to start from NPS, which is simple way to segment the customer base according to perceived experiences rather than standard CRM commercial attributes. But defining a close-the-loop strategy starting from a quantitative measure of customer satisfaction is limiting.
Without a deep understanding of the reasons for the score, you risk managing customer needs inappropriately and creating further dissatisfaction.
For this, you need to use open questions when you collect NPS and analyze the experiences and stories of your customers to set the proper and effective close-the-loop process.
That’s why services like Usersnap’s feedback tool are so important. It provides context to the ratings you get from your customers and enables you to discuss feedback with them instantly.
Below the surface of responding appropriately to your customers’ feedback, the real deal in closing the feedback loop is about how you improve your products and services to meet customer expectations.
You should infuse the voice of customers into your product development cycle.
Did you know 84% of product developments consider customer feedback in the process? (Source: Frost & Sullivan)
Understanding why customer feedback is so important and handling it effectively is just as important as any other element of your business.
Make sure that you are aware of the different segments in your customer base and that you know how to close the feedback loop with each of them.
Use critical feedback to adjust and improve your business. This is the only way you can create a sustainable and purposeful product.
Searching for the right tool to gather NPS and capture qualitative feedback? Check out the easily integrable Website Feedback Tool by Usersnap. Get a demo today or try it out with the 15-days free trial run.