The Importance of Customer Feedback and How to Use It Wisely

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Written By Said

Said is a thought leader in small business marketing. He has founded, grown and sold dozens of successful businesses throughout his career. 


Imagine you walk into a nearby restaurant that has just opened. You taste their signature dish, and you really like it, but the waiting time is too long. As you leave, the restaurant owner gives you a card on which you have to write your opinion about the restaurant. You write down your experience mentioning the problem of waiting time.

A few weeks later, you visit that restaurant again. To your surprise, the wait time was reduced considerably. Due to your feedback, the owner took into account the problem and adjusted the operations in the kitchen to speed up the food preparation process. Your comments were given importance and not only improved the dining experience for you but also that of future customers.

This is a simple example of the power of feedback from customers and how they can drive innovation and improvements. Managing this type of customer feedback is important for businesses, whether you are a restaurant or a global business.

6 Reasons why Customer Feedback is Important

Regularly collecting customer feedback not only gives you a wealth of information about your customers and employees. Potential customers also have access to transparent reviews about your company’s products and services. We list 6 reasons why you should definitely take the time to listen to customer feedback.

#1 Customer Feedback Affects your Online Reputation

What do you do before you visit a restaurant or book a hotel? You research online and look at the reviews. And that’s the case in every industry. You can also track how important customer feedback is in your online reputation management.

Nearly half of today’s customers won’t do business with companies that have a rating of less than 4 stars.

Does your store have high ratings and enough reviews to earn the customer’s trust?

#2 Customer Feedback is the Basis for Purchasing Decisions

Customer feedback cannot be underestimated as a sales driver. Customers are interested in what feedback other customers give them.

When potential customers visit your website, will they buy something? First of all, we can assure you, you will want to see what other customers say about your products and services. It is extremely important that you have many positive reviews on your website, which serve as social proof.

Keep these 2 statistics in mind:

  • 93% of customers say online reviews influence their purchasing decisions.
  • A product with 5 positive reviews can increase sales up to 270% higher compared to a product with 0 reviews. 

#3 Customer Feedback Gives you Valuable Insight into What the Customer Experienced

customer feedback

“You can learn the most from your most dissatisfied customers.”

Bill Gates

Both positive and and even more importantly negative feedback gives you an excellent opportunity to learn. Ask your customers what they experienced at specific touch-points. Also ask what the general experience was like and what they think of your brand. Customers will tell you what they exactly think of your brand if you care enough to listen to them. 

You can find out where the customer has problems and, conversely, what they particularly liked. This allows you to significantly improve your products, services, information and advertising. 

Customers who have a positive experience spend 140% more than those who have a negative one. In a word: convincing. 

#4 You can use Customer Feedback to Determine Customer Loyalty and Satisfaction

By using customer satisfaction metrics in a survey, companies can specifically report to their current customers. This allows you to determine the customer’s overall satisfaction and/or satisfaction with a specific product, service or touchpoint.

Did you know that 80% of companies measure customer satisfaction to analyze and then improve the customer experience?

You can easily collect, measure, analyze and increase customer feedback with the right software. This allows you to identify the customers who want to promote your brand, but also those who might soon turn away.

#5 Feedback is Important for Developing Products

Product teams and service teams often conduct feedback analyses to collect data for improvements. But you could go further and ask questions about specific products or services in a survey.

Project teams can use customer surveys to:

  • To explore new markets
  • Receive suggestions for related products
  • To improve the usability of the product
  • Get ideas for new functions and thus gain a competitive advantage

74% of customer experience professionals say customer feedback inspires them to come up with new product ideas. 

Customers know what they need. Just ask them.

#6 You can use Customer Feedback to Identify Potential Customer Churn

81% of customers who have switched brands say the previous company could have prevented it. 

Most customers simply switch companies without complaining. However, brands that proactively collect customer feedback, analyze the customer experience and take targeted action lose fewer customers. 

You can simply check in with your customers to identify those who are likely to churn. This way you can find out your weak points and then decide exactly where you can improve.

How to use Customer Feedback Wisely?

After receiving customer feedback, the most important step is to utilize that feedback effectively. Here’s how you can do it:

Analyze Feedback Carefully

After getting the feedback from your clients, sit and take proper time to analyze them. Try to identify patterns and trends that you can do by using tools like spreadsheets, charts, and graphs to visualize the data. After that, try to group different customer feedback based on different criteria such as customer behavior, preferences or loyalty. By doing this, you can get to know the expectations of different customer groups and adapt your products accordingly.

Prioritize Feedback Wisely

You can’t work on all the feedback at a time, it’s not humanly possible, so what should you do? Prioritize feedback and decide which ones to focus on first. To rank the feedback, use criteria like impact, feasibility, and urgency. 

Implement Feedback Effectively

The last step is to implement the feedback and make the required changes to your services or products based on the priorities that you have set. 

Key Takeaway 

In short, getting customer feedback regularly is important. No business can afford to underestimate this anymore. If you don’t listen to your customers: your competition will. Remember the famous words of Kate Zabriskie; “The customer’s perception is your reality.”