Most businesses that have invested in some form of market research will understand that it is difficult to find out a customer's wants and needs even though it is important to any business to know the exact wants and needs of their customers. Market research is usually a statistical approach but consumer sentiment is about emotions and this can be hard to represent in a statistical way with numbers.
Many would also be aware that consumer feedback is a significant resource because it can be an unfiltered approach to learn what consumers really think, as well as what they want and need. Feedback extends through multiple channels from call centres to online reviews or in-store surveys. This generates a large amount of data, which can be difficult to manually process. And a lot of valuable insight is lost due to inability to extract all the relevant information from customer feedback. Sometimes businesses' customer feedback can be seen as a problem or PR issue that needs to be fixed. This article will tell you why you should encourage customer feedback for the success of your company.
According to research conducted by Deloitte, companies that are customer-centric are 60% more profitable than those who don’t focus on their customers. This means that any business, which puts customers at the foundation of their business, is already one step ahead of the competition.
Many businesses believe they put “customers first”, however according to a HubSpot research from 2019 42% of companies don’t collect customer feedback. Which means 42% of companies are missing out on valuable insights that can help their company grow and be more profitable.
For product development and marketing promotion, customer input is helpful as it is the fastest way to figure out what customers think about your product or service, what they like and what they dislike. Even dealing with common basic issues customers experience, if these are being resolved before a bigger problem is created it lowers service costs.
In addition, learning and listening to feedback has a direct impact on customer loyalty, which decreases customer retention. Most large firms like Amazon or Apple will send an email after a purchase has been made to ask for feedback. But is that sufficient ?
Feedback is always valuable, but especially the one you don’t ask for. This makes life complicated because it is usually unstructured data you receive that won’t fit in your categorisation. Unprompted feedback also tends to be written by customers that can either be over positive or over-negative. This is known as the “J-Curve” where a significant percentage of motivated consumers give one star but the average review is a 4-star review. However by evaluating the community of the low-star scoring customers, vital insights can be found.
This brings you to one of the main customer-focused results, accepting not only that all feedback is important and should be evaluated but that part of the approach should be encouraging more feedback. However this can only be done once you’re capable of analysing and evaluating the feedback you currently have.
Building a feedback loop that works in today’s environment is critical. Consumers want to be understood, which is why it is essential to listen and act on the feedback received. For example Identifying trends in specific locations or target markets is key to growing sales and product success.
If you already are analysing customer feedback, are you really making the most of it? Are you reacting to customer feedback or are you being proactive about it ? Are you solving customer complaints by offering an apology or are you asking customers what you can do to improve their experience ?
However, recognising and making use of consumer feedback is the foundation of implementing a customer-centric approach. It can be predictive and efficient and create a real voice for the consumer within the company.
Schedule a demo with a consultant and learn how to start analyzing open-ended responses.