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Customer feedback management guide: Best practices + tools

Customer feedback management is key to delivering superior products, services, and experiences. Learn how to do it successfully so you can boost retention and build brand loyalty.

By Alex Smithers, Contributing Writer

Published June 17, 2022
Last updated June 17, 2022

Imagine walking into an ice cream parlor and ordering a chocolate sundae. You sit down and take your first bite, and immediately want to spit out the ice cream—it tastes like radishes. Though you have nothing against radishes, you believe chocolate ice cream should taste like chocolate. You tell the server, who listens attentively and assures you that your feedback is highly appreciated.

One month later, you go back to the same shop. The chocolate ice cream still tastes like radishes. You’re frustrated. You told them about the issue and gave them a second chance. It seems your feedback isn’t as important as they said. You decide you won’t ever return—both because of the taste and because you feel unheard.

Your experience at the ice cream parlor shows why it’s not enough for businesses to just gather customer feedback—they must act on it, too. If the shop relied on customer feedback management, the server would have shared your feedback with the owner, who could have changed the ice cream supplier (and left you with a sweeter taste in your mouth after your second visit).

Companies that create a process for collecting, analyzing, and acting on customer feedback improve their chances of impressing buyers. With customer feedback management (CFM), you can experience less churn, improve customer satisfaction, acquire more buyers, and, ultimately, generate more revenue.

What is customer feedback management?

CFM is the process of turning raw feedback into actionable customer insights, then leveraging them to deliver better products, services, and experiences. Gathering feedback, adding it to a centralized database, analyzing the information, compiling reports, and sharing findings with the relevant departments are all part of customer feedback management.

Say you recently launched a teakettle made of 100-percent recycled materials. Through online comments and real-time interactions, you discover that numerous customers think the handle is too small. You synthesize the information, identify the pattern of negative feedback, and send a report to product design. Future versions of the kettle are designed with a larger handle. This results in happier customers and a higher Net Promoter Score® (NPS).


Customer feedback management typing

Types of customer feedback

How you manage feedback depends on the specific feedback you receive. While there are various types of feedback, they come in one of two forms: direct or indirect.

Direct customer feedback

Direct feedback is when customers provide their input after you explicitly ask them to do so. Sources of direct feedback include:

  • A post-purchase survey
  • Customer support chat
  • Customer support phone calls
  • Pop-up UI (ease of use) or user experience (UX) surveys
  • Feature requests
  • Results from usability testing
  • SMS customer satisfaction surveys
  • Requests for help or information via your company’s social media accounts

Indirect customer feedback

Indirect feedback is input you didn’t necessarily ask for but can still see. Types of indirect customer feedback include:

  • Reviews on third-party sites
  • Changes in shopping behavior
  • Posts about your company and its products on social media
  • Unsubscribes from your mailing list
  • Conversations in online forums

Indirect feedback is just as important to monitor as direct feedback—unhappy customers may not bother to give their opinion directly. Connect a social listening tool like Sprout Social to your customer service software, and watch for changes in your email unsubscribe rates.

Customer feedback management examples

It’s easier to understand the difference between customer feedback and customer feedback management with examples.

When customer support tickets spike, that’s customer feedback. Once this pattern is spotted and flagged, a cause is identified, the relevant decision-makers are aware, and steps are taken to address the problem, that’s CFM in action.

When customers participate in a focus group and give their opinions on a new product, the resulting information is customer feedback. Recording that data, extracting the key insights, and sharing that knowledge with the product development team is the process of CFM.

Why is customer feedback management important?

When you can effectively turn feedback into better experiences for your customers, you’ll benefit by seeing:

  • Higher revenue
  • Reduced customer churn
  • Improved products or services
  • Long-lasting customer relationships

CFM enables you to optimize cost by giving you a way to systematically act on feedback at each stage of the customer journey. A Namogoo survey of business leaders found that cost optimization is the biggest priority for many companies in 2022, especially in the growing ecommerce sector. With cost optimization so important, you should do all you can to avoid losing customers. One of the best ways to achieve that is to put solid CFM processes in place.

A documented system allows you to address problems that push shoppers away and, as a result, reduce churn. At the same time, you can expand upon the aspects of your business, products, and services that customers like—leading to higher satisfaction and revenue.

Additionally, when you act on customer feedback, it shows your audience that you care. When buyers feel heard and valued, they’re more likely to stick by you and recommend you to people they know.

How to structure your customer service department

Learn more about the key steps for structuring your customer service team with this free guide.

Breaking down the customer feedback management process

Breaking down the customer feedback management, playing pool

CFM can be thought of as a process used to deliberately build a customer feedback loop. That loop starts and ends with customer interaction and includes five stages:

  1. Gather customer feedback

    Collect customer feedback as raw data. This process could involve compiling social media responses or sending customer satisfaction surveys via email or text.

    Suppose you recently launched a new product—a set of salt and pepper shakers. Since launching the shakers in stores, sales have been underwhelming. The low sales numbers are a form of indirect feedback, but you want to pinpoint the source of the issue. To do this, you’ll need more information. You decide to get some of your target customers together for a focus group.

  2. Extract insights

    With the feedback in hand, you look for recurring patterns. When you identify two instances of customers making the same point, you establish a category for it and place any future examples into that bucket.

    Imagine focus group participants had two main issues with your salt and pepper shakers. First, they felt that the quality of the materials wasn’t good enough to justify a premium price point for the set. Second, participants didn’t think the packaging stood out enough. As you read the transcript of the focus group session, you notice these two recurring themes. You create a section in your notes for each problem, and you begin numbering every time the issues are mentioned under the relevant heading.

  3. Share findings with team members

    Once you’re done with your notes, send the insights to the people who need them. They may be decision-makers with the power to influence product development, pricing, or other important areas. Or, they might be customer support agents or sales representatives who need to better understand customer perspectives.

    How you get the information to the appropriate team will depend on your internal processes. It may be as simple as sending an email highlighting the main points. Or, there may be a more elaborate process automated through customer service software.

    In our salt and pepper shaker example, the biggest issues are related to the packaging and the quality of materials relative to the price point. It makes sense to share your report with decision-makers who can adjust pricing. You should also send it to the design teams responsible for both material selection and packaging.

  4. Apply the lessons

    The relevant party acts on the feedback. The specific action taken will vary depending on the feedback received. Some things will be quick and easy to implement, such as a minor tweak to language. Other feedback may require more effort to act on, like updates to long-standing policies or physical changes to products.

    In the case of your salt and pepper shakers, you could try to change the retail price of the product. But pricing adjustments can have major consequences for a business, so such a decision should not be taken lightly and without reference to the company’s financials. Other ways to act on the feedback include swapping the materials used in the product and improving the packaging to make it more eye-catching.

  5. Return to the source

    Tell customers how you responded to their feedback with a follow-up. If a customer participated in a post-purchase email survey, send them an email that describes how your business implemented their feedback. If adjustments were made in response to certain social media comments about your products or services, putting out a statement on your social channels could make sense.

    In the case of your focus group, returning to the source involves informing all the participants of the changes through their preferred contact method.

Customer feedback management best practices

Customer feedback management best practices, thumbs up

Quality CFM is based on connectedness—specifically, successfully connecting insights from customer feedback to the right people. The information must arrive in the hands of decision-makers who can interpret and act on it.

Think of CFM as a relay race, with the feedback as the baton. All CFM best practices reflect that philosophy.

Evaluate current processes

Find out what CFM systems are already in place so you can keep things streamlined. Parallel or duplicate systems can harm CFM effectiveness, as employees may be unsure of how to process feedback. This uncertainty might cause them to do it incorrectly or hesitate to take action. A complicated CFM system with multiple layers can also lead to team members unnecessarily duplicating efforts—for example, by adding the same information into more than one tool. Such instances waste time and money.

If you know what CFM practices already exist, you can add value by simplifying them as you move forward. You may find opportunities to eliminate redundant processes. For instance, if support agents report customer complaints through separate databases using different software, you could consolidate them into one main system.

Set goals for customer feedback

Involve all the important parties when deciding the company’s goals for CFM. This will help ensure you collect the right data and establish processes that make feedback readily available to the appropriate team members.

If you bring in the key stakeholders early, you’ll also find it easier to get buy-in for your CFM initiative. Rather than feeling they’ve been subjected to another set of business processes without being consulted, stakeholders will feel involved and understand why the system was set up. And remember: Team members will be more likely to use CFM if they see its value, so be sure to communicate why CFM helps each department achieve its objectives.

For example, the marketing department may be focused on optimizing the customer journey, but sales might see feedback collection as an opportunity to learn about customer expectations on pricing. Meanwhile, your product team might be interested in using feedback to refine the product roadmap. You could set up a meeting with all relevant department heads and explain how incorporating feedback can enable them to succeed. Determine what type of data they would find most useful and how they’d like it delivered and presented.

Use the right feedback channels

Make sure the way you collect feedback supports your objectives. Tailor certain channels to capture particular kinds of information so you can gather more valuable insights. This will also likely increase the range of feedback you’re able to collect.

For example, in-app surveys are useful for user interface (UI)-related questions because the experience is still fresh in users’ minds. Meanwhile, customer satisfaction (CSAT) surveys sent via email are useful for gauging customer sentiment and opinion after they’ve started using the product or service.

House feedback in a single location

Use customer feedback software to consolidate feedback data and analysis. Putting all your customer feedback in one place will help keep the information organized, save team members time, and make interpretation and management easier.

Scattered information is hard to find and use. This will hinder collaboration and prevent team members from leveraging the data to make improvements.

Send actionable insights to decision-makers

Unless feedback is acted upon, there’s very little point in collecting it. To increase the chances that customer feedback leads to positive change, make it digestible and deliver it in your recipient’s preferred format.

The goal is not to provide an impressive-looking report—it’s to help decision-makers understand what buyers think and feel as efficiently as possible so they can improve the customer experience. Present only the main findings; there’s no need to include every response. And you don’t want to add any unnecessary work for the reader.

For instance, if a product page is inundated with customer reviews, offer one or two examples that are representative and indicative of how overwhelming it is for visitors. If you have facts or stats, such as “60 percent of customers surveyed complained about the number of reviews on the page,” include them.

Customer feedback management begins with the right tools

CFM success starts with the right customer feedback software. Tools like Zendesk enable you to house all your customer feedback in one place and translate that input into data-driven decision-making.

Teams can use the software to gather feedback, review the data to make improvements that align with company goals, automate the feedback process through integrations with third-party applications, and interact directly with customers.

To move forward with customer feedback management, invest in the right tools, and you’ll be well on your way to improving CX and reaching your business goals.

How to structure your customer service department

Learn more about the key steps for structuring your customer service team with this free guide.

How to structure your customer service department

Learn more about the key steps for structuring your customer service team with this free guide.

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