Customer Feedback: Why It is So Important

Your business depends on your customers – which means you need to create a great customer experience and back it up with great customer service.

But how can you be sure that you are doing both of those things?

If you do not try to find out what your clients actually think about your service, you could be working very hard to provide them with exactly what they don’t want. They will soon be heading to a competitor who can offer what they do need, want, expect – and be happy to pay for.

Your customers' opinions about your products and services and their experience of working with you are priceless. With this information, you can adjust your products and services and the way your business works to provide them, to fit their needs more accurately. Top-performing companies consistently listen to their clients and customers – because they know how important it is.

“I was producing a range of Kefir drinks. I was making sure they were organic and really healthy, and always fresh. But it wasn’t until I started talking to the small numbers of customers who bought them that I realised the problem. They liked the health-giving qualities – but they really didn’t like the taste!”

“We were looking at franchising a budget vehicle respraying system from the states. It is successful over there. But when we set up a trial operation, we were getting no business. It seems UK drivers are just not as keen on their cars as we thought – and those what wanted their cars to stand out were using the low-cost alternative of wraps.”

Whatever your line of business, you need to know what your customers really think – and the only way to find out is to actively seek out customer feedback.

What is customer feedback?

Customer feedback is simply what your customers think or feel about your products or services and the way you provide them.

Their opinion is a resource for improving customer experience and adjusting your actions to their needs. These days, you can find opinions and reviews your clients post online in the form of unprompted feedback and collect them using internet monitoring tools. On a more sophisticated level, this information can also be collected with different kinds of surveys, known as prompted feedback.

Both types of information can be valuable in helping you to get a full picture of what your clients think about you and your brand.

Here are the top reasons why customer feedback is important for your business.

Customer feedback measures customer satisfaction

Customer satisfaction is crucial to your company’s financial performance.

Satisfied customers tend to be repeat customers. Dissatisfied customers will be taking their business elsewhere, usually to your closest competitors.

Many studies have confirmed that this theoretical link is borne out in fact.

There is a close connection between customer satisfaction and business performance. It is directly linked to many benefits, such as increased market share, lower costs, or higher revenue. Therefore, there is no doubt that you want to make sure your clients are happy with your products and services. Naturally, the best way to find out if you meet their expectation is to get their opinions. Using rating-based questions will let you provide a rough number value to the qualities you want to look at, and help you estimate the level of satisfaction you have created in the past and consequently predict your company’s financial outlook in the future.

So, are your customers satisfied? Did they like what they bought from you and the way that you helped them to buy it? Would they buy it again? Would they recommend it to a friend? What did they think about the price, performance and aftersales service?

Customer feedback helps improve your products and services

You can never afford to stand still in business. Some products date quickly, might no longer meet customer needs, could have been bettered by the opposition – customers could simply have bought all they need.

If you know what customers are thinking about the product or service you offer, you can use that information to improve it.

Obviously, when you introduced a new product, brand or service to market you probably had an idea about customer needs, and how whatever you were offering would provide a better answer to them.

Most businesses will conduct some form of market research before a new product launch that will help explore whether there is potential demand for the product – whether customers would be willing to buy it and what they might be prepared to pay.

However, only after you have launched, and your customers have used your product or service, can you really learn about all the advantages it offers, the shortcomings it has, and whether they will be buying again.

Remember, customer needs and expectations evolve with time. They will want new features and benefits – getting feedback after the launch not only shows what you have got right and what you have got wrong with your offering – it can show you the direction you need to take it in for the future.

However, there are limits to what you can gain from customers' previous experience. Henry Ford famously said, that if he had listened to what customers wanted, he would have built a better horse, not a Model T – but it could help you understand the needs you customers really want to be answered in future.

You might have the best expertise in your industry but your professional knowledge will never be more valuable to business performance than customer insights.

Customer feedback is an insight into what is working well about your product or service and what should be done to make the experience better. Their opinions help you ensure that the end product will actually meet their expectations, solve their problems and fulfil their needs.

Do you feel your business would benefit from becoming more customer-centric but concerned about cashflow? Take a look at your business finance options 

Customer feedback shows you value their opinions

People appreciate when you ask them if they are happy (or unhappy) with your service. It shows you actually value their opinion and that you are here for them, not the other way around. By asking your clients for feedback, you demonstrate that their opinion is important to you, that you are interested in their experience and feedback, not just their cash.

Listening to their voice also helps you create stronger relations with them, creating valuable brand ambassadors who will spread positive word-of-mouth for you.  

Customer feedback helps you create a better customer experience

Today’s marketing is heavily based on experience - the experiences people have with products, services and brands determine whether they will be customers again.

“I had customers who told me my organic dogfood was great. But dogs will eat anything. What they were really telling me was that they liked buying the dog food for their pets. This made me realise they were buying the brand because they were committed to the organic movement. I stopped basing my marketing on the taste of the food and started talking about the way it is sourced and produced. The result - more sales.”

Therefore, if you focus on providing the best customer experience at every touchpoint, clients will stay loyal to your brand. One of the most effective ways to give them a memorable experience is asking them what they like about your service and what should be improved - and then making sure that you deliver on it.

Customer feedback helps keep customers and find new ones

Customer feedback helps you determine if your clients are satisfied with your service and detect areas where you should improve. Asking for opinions regularly means you can keep your finger on the pulse. Each time a dissatisfied customer expresses their disappointment, you can immediately react and find a solution - heling win back their business. 

An unhappy customer who has a problem with your service that you make a point of fixing is likely to have greater devotion to your brand than a customer who has never been disappointed, and so never seen evidence of your devotion to making things better.

Potential customers will be looking for reviews online about your products and your business. People are unlikely to provide much feedback when you simply answer a need - they are much more likely to do so if you have responded to a problem well.

“I run a garage. When people bring their cars in for servicing, it is just routine - they don’t get excited about what we do. But when I found that customers were annoyed that we were not valeting their cars before giving them back, I not only started making sure cars were given back squeaky clean, I called the customers who were displeased and offered them a free valet.

"They were delighted. They started telling their friends. I got better online reviews and more customers.”

Working a little harder to respond to customer feedback can impress the once-dissatisfied customer to start posting online about the extra effort you have made.

It could be the most powerful form of marketing there is. 

Customer feedback gives you a sound basis for your business decisions

There is no place for business decisions based on guesswork. Successful business owners use feedback to gather data that helps them develop future strategies based on a quantifiable foundation. Only in this way they are able to adjust their products and services to perfectly fit customer needs.

Take their suggestions into consideration and find out where you should allocate your money to get the highest return on investment. You might discover that, for instance, further product development is not necessary in your case, but instead you should focus on promoting your brand  to ensure that more people know about your products and are ready to buy them.  

“You know that you need customers at the heart of your business - it is only sensible to view their feedback as the most valuable source for information in your company. They are the ones who use your products and services, so they know best what could be improved - and if you fail to meet their expectations, they will find another company which will do it better than you. It costs us money to do surveys and analyze the results - but it is an investment that is worth it.”

Do you need help to fund product development, marketing or to get the customer feedback you need? 

At Rangewell, as experts in business funding, we know the fastest ways to secure the funding you need. We can help streamline applications - ensuring that your business can receive the funding it needs in the shortest possible time. 

Call us now – our experts are ready to help you with any finance questions you have.