The Importance of Customer Feedback



Getting feedback is the right thing to do, everybody can agree on that. At every workshop I have ever conducted, 100% of participants agreed that customer feedback is essential. In reality, though, very few companies solicit feedback, and even fewer actually use it. Feedback you don't listen to isn't feedback, it's a wasted opportunity.

Obviously, we don't want to hear negative feedback about the products we worked so hard to deliver. But customer feedback is essential, not just for marketers, but for everyone from R&D all the way to top management. 

Not collecting feedback is unforgivable, we won't even deal with those laggards who don't bother with it. The real problem is with companies who collect feedback, and don't do anything meaningful with it.

Why companies don't listen to feedback

There are a number of reasons why companies don't listen to feedback. Here are the most common:

Bridges to nowhere

90% of the time companies build feedback bridges to nowhere. A system to collect feedback is in place, but it ends up unread, and thus useless, in a lonely folder on a hard disk. Or in a database no one ever looks at. Or a department that doesn't do anything with it.

Solution: assign one person in the enterprise to exclusively deal with feedback and make sure it is collected, analyzed, and the results distributed to reach the right departments.



Perhaps there is someone in charge of collecting feedback and presenting it in regular meetings, but everything is handled case-by-case and there is no proper SOP in place what to do with feedback. For what type of feedback do we alert which kind of manager? What gets channeled back to product development? How do we know which feedback is actionable? How do we handle offensive or aggressive feedback? How do we analyze numbers? What percentage of negative feedback about a feature triggers what kind of response?

Many of our clients are confronted with negative feedback. They call the office and say thing like, so-and-so posted on something negative on our Facebook page, what do we do?

Solution: The question is not what you do in an individual case, but how do you standardize the handling of negative (or positive comments). Proper SOP will say something like, "react to nevative comments within 24 hours, don't delete them, offer posters and email address to channel their anger away from the public forum, etc.) 

SOP is key to handling complaints and praise alike.


No follow up

Even when a company has proper feedback channels and an SOP, there is often no follow up what happens to feedback. After receiving 100 complaints about feature X, was it eventually changed? Who was responsible for the change? Did the change reflect what customers said in the feedback? Good feedback systems must always be traceable and accountable.

Solution: Make sure your SOP includes the feedback to the feedback. Everyone in the organization who receives customer feedback should, in turn, be responsible to document their reaction to that feedback. Just like doctors in hospitals have to do presentations after a patient dies, R&D engineers, managers, customer service staff etc. should be required to report how they reacted to customer feedback both immediately (responding to complaint) and in the long term (changing product features).


What does feedback do for your business?

To understand why customer feedback is vital for any business, you have to look at the economy itself. It consists of producers and consumers: companies are producers while individuals and other companies are consumers of goods.

The economy works by the law of supply and demand. Demand means consumers want something. If they don't like it, they won't want it. It is therefore essential to know what they like, otherwise, companies will produce for a demand that does not exist.

Thus, once you have a good feedback channel, SOP, and follow-up strategy in place, feedback can help you achieve the following:


Improving Products

By taking feedback under consideration, faults of the product can be easily detected and fixed, leading to a higher overall quality and better sales.

It sounds so simple but it is too often overlooked. I recently completed a project with a client who made an IT product. 90% of customers gave feedback that the setup procedure and connecting the device to other devices was far too cumbersome. That feedback never entered the minds of the managers, who only heard from their engineers: we can't do it any other way. At the end, the company produced over 2 million pieces of a product, which received horrible feedback on Amazon and similar websites. Demand disappeared overnight.


Not listening to customers = losing money.

Aside from improving the product, listening to customer feedback is also an effective method of evaluating your team. For example, with online employee information available, customers of the service industry can easily rate your employees based on their performance.


Feedback Creates Relationships

Customers will remain faithful to the products they helped shape. Truly listening to your customers creates a relationship with them that, if carefully maintained, can provide consistent benefits to a company. People are much more likely to give their business to a company that is known to them, and which respond to feedback in a meaningful way. Customers are more likely to forgive a company for slipups if it usually listens and responds to feedback.

This, of course, has a great impact on digital marketing efforts. If you don't respond to feedback you receive online, you will not garner the goodwill of your customers, and they will be less forgiving when you mess up.

Customer retention and fidelity is the welcomed by-product of a good customer relations policy. Satisfied that they have been listened to, customers will remain faithful to the products they helped shape and mend. Moreover, the company will receive good PR – the kind that cannot be bought with a media campaign. A responsive company is a good company.


Gaining Competitive Advantage

People always say Apple is successful because they are innovative. Apple is not an innovative company. Almost every feature or product they ever came up with was a knockoff. Apple is a listening company. They listen to feedback, over and over again, until the vast majority of customers are satisfied with the experience.

No matter what you do, your product may not always be the best and your ideas might not always be the most innovative. Even when such is the case, a larger company might outspend and outproduce your capabilities, selling at a price which would put you out of business.

Because the market is always changing and the trends are always shifting, staying ahead of the curve can put you ahead of the larger companies in terms of understanding the preferences of customers. Aided by a good relationship, your customers may even prefer your product above others for personal, emotional reasons that do not relate to product quality.


Stay Ahead of Future Trends

Aside from improving your products and the opinion that customers have of your company, listening and reacting to customer feedback can also provide valuable data regarding future trends. If the focus of the consumer is on a single feature of the product, that should tell you something about importance of that feature, and where you should place the emphasis for future development.


Keeps Your Employees Creative

Making feedback part of the conversation inside the company keeps your employees on their toes. Why did you not listen to this feedback? Does R&D think we can do better? Feedback from engaged customers is a valuable pool of ideas that can inspire researchers, engineers, and even your customer service department.

For customer service employees, knowing what a lot of people say about the product can prepare them for answering calls and emails in a professional way, reducing friction with complaining customers and creating a much better user experience.

In conclusion, gathering and using feedback isn't really an option for a modern enterprise. If you don't do it, you will be less profitable, you may even lose money, you will certainly disappoint your customers, and you will fall behind the competition. Before you know it, you are out of business.