The Power of Customer Feedback

July 4, 2011

In this day and age, the average business loses 10% of their customer base every year, and most don’t know why. Increased competition, pressure for time, decisions, and action are burdening owners like no other time in history. To gain a competitive advantage over their competition, and to grow a healthy business, smart owners and their managers are putting customer feedback to work for them.
Would you hire a new staff member without checking references?
Would you rent your property to a new tenant without checking with previous landlords?
Yet, we expect prospective customers to purchase from us without knowing about the quality of our product, without knowing how good our after sales support is and without knowing what we are good (or bad) at.  Would you purchase?

Customer feedback and reviews are not testimonials.  Unlike many website testimonials, good feedback is honest, unscripted and one of the most effective marketing tools available.  With social media today, feedback and reviews are prevalent – it is your choice as a business manager or owner how you decide to act on what your customers have to say.
How can Customer Feedback help my business?
  • Validate or invalidate YOUR own assumptions on your business’ performance.
  • Make sound business improving decisions thereby helping you build, retain, and increase your business’ customer base.
  • Immediately identify potential business-losing trends.
  • Tap the thoughts and opinions of your most valuable asset – YOUR customers.
  • Decreases costs, thereby increasing profits.
  • Monitor the performance of your staff whether you are at the business or not.
  • Increase customer loyalty.
  • View your business from your customer’s perspective.

Use your customer feedback the SMART way:
  • Spot emerging customer needs. Use customer feedback to identify needs that you may not be aware of.  Don’t just take customer comments and feedback at face value, what’s the need beneath or beyond what you hear or see?  Social networking tools like Twitter or Facebook may be particularly helpful here. Emerging needs are the headwaters of demand for your organization. Give yourself the opportunity to solve a greater number of customer needs in the future.
  • Measure emotions. Identify the emotional tone your customers convey when they talk about your product, brand or organization.  Does it match what you hoped customers would feel or customer experience? If not, how can you close the gap? Are the emotions you hear consistent across customers? Are they consistent for each customer over time? While the tangible elements of your customer experience most directly solve a customer’s need, the emotional elements build loyalty. You must meaure the emotional elements of your customer experience. More often than not, it’s the emotional connection to your brand that is much stronger than rational one. 
  • Act now.  Make sure you’re doing something meaningful with your customer feedback. Maybe this is ridiculously obvious. But too often organizations have too loose or even no set discipline and structure to leverage what customers tell them through actions or words. Online or offline. If customers are criticising how long your website takes to load, speed it up and let your customers know you appreciate their feedback and have fixed the problem.
  • Reduce customer effort.  Find out how many times prospects and customers have to interact with you to get what they need. Understand their point of view regarding how hard they’re working to get what they need.  Listen to feedback commenting on how easy (or hard) your company is to deal with; how accessible your staff are, how they find your online ordering system.  If there are problems, solve them and let the customers know how their experience will improve.
  • Translate feedback into product innovation. I’m not talking about crowd-sourcing here. I’m simply talking about using customer observations, ideas and feedback to drive product and service innovation for your company. Quite often, customers have ideas you haven’t considered since they’re the ones actually using your products and services on a daily basis. Create simple processes where you can get that direct customer feedback into the hands of product designers and innovation leads for your company. Or, take that notion a step further and actually invite key customers into workplace to innovate right alongside the innovators.
Of all the things that can influence your prospects to buy from you, there is none more powerful than your existing customers.  Advertising or promotion power pales into insignificance compared with what your customers say.

This effectively means that if you can harness the power of the word of your existing customers properly, you can expect to reduce the amount of money you spend on less effective advertising and promotions.

    Remember, there is no such thing as bad feedback.

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