Customer Feedback Loop3

Closing the Customer Feedback Loop

Customer Experience

Ensuring an excellent customer experience can be tricky but an effective guide can help.

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Any business that attempts to increase customer lifetime by retaining them is familiar with the concept of Closing the Customer Feedback Loop. However, you will find a noticeable gap between companies who try to close the loop and companies who succeed. 

There are many companies that devote a lot of time and resources to collect and listen to customer feedback. But, very few of these companies act on the feedback or are happy about the outcome they reap from the entire process. 

You may send teams out in the field to engage with customers to gather insight or bring in loyal/heavy spending customers to talk about their experience. However, without a strategic feedback program, you will fail to convert these insights into actions.

According to Harvard Business Review, most customers who declare themselves “satisfied” or “very satisfied” with their experience are the ones who jump the ship not too long after. 

Before we dive in on the importance and best practices of Closing the Customer Feedback Loop, let’s do a once-over on “what is closed-loop feedback?”

Customer experience

What is a Closed-loop Feedback?

Closed-loop feedback refers to the completion of the feedback process. When a business takes action on the feedback provided by the customer and responds back it is called a closed feedback loop. Identifying the pain points within customer feedback and responding to customer’s concerns or praises, a business develops a formal process to retain its customers. 

A strong and well-organized feedback loop involves customers at the front and center of the entire process. By timely and effectively closing the loop a business ensures a positive outcome for customer experience.

Why Closing the Feedback Loop is Important?

In all honesty, whether you are a B2B or a B2C company, a company owes its client/ customer response especially after receiving feedback from their end. 

When you request feedback or send a survey invitation you are explicitly declaring that you want to hear your customer’s voice. However, it is of no use if you just hear them and do not take action or respond back. Asking for feedback and taking no action against it is the fastest way to lose credibility among your customer base. By doing so, you rather contribute to bad experiences and push your customers away. 

  • The American Marketing Associates report that consumers talk about their good brand experience to an average of 9 people. But, they talk to 16 people about a bad experience with the brand. 
  • Ruby Newell-Legner’s “Understanding Customers” reports that it takes 12 good (positive) experiences to make up for 1 negative experience.

1. Analyzing the feedback and responding accordingly makes customers feel valued and appreciated by the company. This ultimately drives customer retention, because customers are highly likely to remain loyal to a brand that truly pays attention to them and listens to their concerns. 

2. Paying attention to the collected feedback and closing the loop brings various paint points and issues into the brand’s notice which they would have otherwise missed. There could be issues that your customers are facing which you are not aware of. Closing the feedback loop will shed light on the matter. 

3. Closed-loop Feedback also helps in improving employee productivity. Feedback makes employees aware of their mistakes. It helps them learn how they can recover a potential issue and improve customer retention. Closing the loop helps them identify the upset customers and as they learn to proactively respond to them, employees improve their productivity.

Best Practices to Close the Customer Feedback Loop

Leverage Automation

Automation can help when it comes to effectively closing the feedback loop. Many businesses have adopted automated CRM to trigger requests for customer feedback. Moreover, it also helps in efficiently processing the feedback and taking appropriate action. 

Automation also helps the brand to trigger surveys consistently. You can decide when a feedback request should be initiated and set the frequency so that you don’t have to manually send out the surveys every time it is required. 

However, it is also important to note that the customer should not be overwhelmed with too many survey requests. You should focus on soliciting feedback during the important touchpoint in the customer journey that has the biggest impact on their experience. 

Automation can route the right feedback to the right department immediately while it’s still relevant. It also helps to detect the immediacy of the issue and send it to relevant senior employees or departments in real-time.

This ensures that the issue is addressed efficiently and timely. It also ensures that the brand closes the loop by responding back to the customer. For example, if a customer sends a request for help via social media, their request can be routed to a relevant team who can respond immediately and are best suited to help the customer.

Create a central base for Customer Feedback

The challenge that most companies face, when they have to analyze customer feedback, is how scattered it is across the entire company. Most of the time, the customer data is siloed. It is spread across various departments and their databases. This makes it difficult to access the feedback in order to analyze it. 

So, the best practice is to make the customer data centralized in order to make it accessible. When the customer feedback is collected and transferred to a centralized location where any department or team can look through the feedback it can make the entire process seamless and efficient. 

With a central database, 

  • It is easier for every team to communicate the actions taken for particular feedback.
  • It helps keep track of all the actions taken and the follow-up initiated in a timely and systematic manner. 
  • It ensures that the feedback is not lost and they reach the right team while it is relevant. 

Consistent follow-up on feedback 

It is important to understand that the speed of response should not be the focus. Getting in touch and helping the customer immediately is important however, it all goes to waste if the resolution fails. The focus should be on a resolution that helps convert positively impacts the customer experience. 

Prioritize which customer to respond:

It is of course important to follow up on customer feedback, however, it is also important to prioritize the feedback. When prioritizing which customer you should respond to first it is better to not limit only to the detractors or at-risk customers. While it is a good strategy to respond fast in order to win Detractors back, Promoters are also a big part of closed-loop feedback. 

To create a more formal system of prioritizing customers and responding to them, companies can assign separate time frames for detractors, promoters, and passives. The team can start by closing the feedback loop for detractors within 24 to 48 hours of receiving the feedback. They can allow a long timeframe for promoters and passives for follow-up. 

Prioritize issues that may have potential impact: 

Apart from focusing on the type of customers and their feedback, businesses can also prioritize the issue that may have a big impact on the business. While all negative feedback or complaints are important you cannot, however, solve all of them. 

It is important to prioritize even among the complaints to figure out which issue needs an immediate response. Sometimes it is better to close the loop on feedback that may seem like a small issue but has a bigger impact on the company’s revenue or even reputation. 

It is better to focus on resolving concerns that may harm the company and give bad CX than trying to close all feedback loops at once. 

Be it prioritizing customers or potential issues, a systematic approach to resolve and close the feedback loop works more efficiently. Identifying what impacts the CX and company the most, responding to those concerns, and communicating the action to the customers helps create seamless Closed-loop Feedback.

Appoint Closed-loop Owners

The process of closing the feedback loop is challenging and requires focus to consistently respond to the customer feedback. The best way to maintain the process efficiently is by appointing people, i.e., closed-loop owners, to determine when and how they will contact the unhappy customers and close the customer feedback loop. 

Large-scale companies can afford to dedicate a team for this purpose. But, it may not be the same for small-scale companies. They may find more balance by distributing the task among different departments and coordinating with each team to close the feedback loop and ensure positive CX. 

However, the people responsible should have experience working with customers. The experience makes them fit for the role to understand and build an empathetic relationship with the customers.

It may also be a better idea to engage senior executives and key stakeholders to solve customer concerns and close the feedback loop. 

Train the people responsible for closing the loop

The people who are held responsible for the job should have the skill and ability to communicate and remain engaged with the customer throughout a difficult conversation. 

In order to help employees develop those skills, many businesses ask employees to identify pain points in a customer journey. The employees are asked to provide their feedback on the CX delivered. This helps them understand CX from the customer’s perspective and identify opportunities and insights which they can use to support customers and close the feedback loop. 

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Acknowledge the employee and celebrate success

Closing the feedback loop should not feel like an additional workload. All the departments and employees should happily engage in the process. The employees should willingly put effort and develop a customer-centric mindset. To encourage the employees involved in the process companies should acknowledge their effort and strong participation in successfully closing the loop. 

Senior-level executives, managers, or CEOs should formally recognize and reward the people who maintained a strong engagement with the customer and closed the feedback loop with a successful resolution. This can not only encourage the employees to put more effort but also build a CX culture. 

Failing to close the loop is as frustrating for the employees as it is for the customers. Thus, recognizing the hard work and effort they put into completing their job to deliver better CX can make the employees happier. Happy employees lead to productive and efficient work in the future. 

Share results with Customers

Communicating the result and all the actions you took against the feedback is an important factor in ensuring customer engagement. As customers take their time to provide feedback, it is equally important that companies honor their effort by responding back to them. 

Companies should dedicate time to inform the customer of the actions they have taken just like they dedicate time to analyze feedback and develop appropriate actions. Communicating the result to the customers helps open a discussion for the resolution. 

Keeping open communication ensures the customers that the company listens to their voices and cares for their concerns. When they know that their feedback leads to a change, it improves the perception customers have about the company and also improves the relationship. 

Involving customers may even lead to identifying solutions that result in successful resolution and even increase customer engagement. Keeping customers informed about all the actions taken and brainstorming with them can also help identify solutions to improve the situation.

Explore all the survey question types possible on Voxco

Explore all the survey question types possible on Voxco

Conclusion

When you ask for customer feedback you are setting the expectation that you will work on the feedback you receive. Customers end up having high expectations from the company. It is only acceptable that you honor them and take action and respond to the customer. 

By responding timely and communicating successful resolutions back to the customer you are leading towards a greater customer experience. Customers feel heard and understood which leads to improvement in customer loyalty and retention.

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Great Research
Fast Insights
Best-in-class ROI

Voxco’s platform helps you gather omnichannel feedback, measure sentiment, uncover insights and act on them.

Join 500 + global clients across 40+ countries