At one point in everyone’s life, they have either given or received feedback, whether it was positive or negative. Yet, what is feedback exactly and why is it so important for us to receive it in order to grow?
Feedback is defined as a reaction or a response to a particular process or activity, it occurs when outputs of a system are routed back as inputs as part of a chain of cause-and-effect that shapes a circuit or loop. The system can then be said to simply feed back into itself.
Stone and Heen from Harvard argued that there are three various kinds of feedback mainly based on purpose: Evaluation, Appreciation, and Coaching. Evaluation feedback requires to be done “within the moment” to help the person receiving the feedback realizes where they stand.
Additionally, who would dispute the theory that feedback is a good thing? All can benefit from feedback. Both logic and research make it unambiguous– feedback and opportunities to apply that feedback, further improve and enhance, whether an individual, community, business, company, or organization – and that information can be used to make higher-informed decisions. It also empowers us to develop and maintain communication with others.
So, constructive feedback is a strong tool for creating a healthy environment, boosting productivity and engagement, as well as achieving better decisions. This works for education, sports, business, and many other pursuits.
Feedback is not only effective when building a business, but it is also the way to grow your community — in size, in knowledge and in engagement rates. Out of that growth and collaboration, your organization can create better products, a blooming community, a healthy culture, and a stronger company.
Why is consumer feedback so important and effective?
To set it in simple terms, 77% of customers view a product or an organization more positively if you provide and accept customer feedback.
To display it into four main reasons why feedback is so essential:
1. Unsatisfied customers will speak louder
If customers are not satisfied with your product, service, or organization, they are statistically going to tell on average 15 people about their experience with you. This results in a chain of reactions that causes bad publicity and thus bad business.
2. Negative feedback results in a better prosperous future
73% of customers who leave negative feedback, do so to achieve a positive change and for the company to enhance themselves as well as for future customers to have a better experience. This feedback helps you to proactively identify mistakes before they happen and thus allows you to take precautions and actions before other customers have a similar experience, and thus churn.
3. Customers leave when they feel uncared for
A study showed that 68% of customer retention occurs when they feel unheard and overlooked. Therefore, communication and inquiring feedback from customers shows that you care about them and their experience, which is key to being successful. It’s really about making customers feel like they are a part of something, that their opinions are desired and valued, and that they are contributing to the brand.
4. Most future profits come from your current customers
A surprising fact is that 20% of your existing clients will contribute to 80% percent of your future profits. Thus, increasing customer engagement improves not only the product but also the profitability of your business/ organization. Customer engagement is something that every business should strive for since it’s extremely beneficial. Outcomes of customer engagement include, but are not limited to, the following benefits:
- Developing customer loyalty
- Finding advocates
- Increasing purchases
- Creating hype around the product/ organization
- Decreasing churn and increasing retention
- Connecting with your customers’ personally
Therefore providing customers or a community with a platform where they can communicate and interact with each and to the organization can be a major supporter.
How an online community platform can help – 4 things!
1. Immediate feedback
Having a community platform provides the opportunity to receive immediate feedback, as the necessity to obtain insight frequently and early in the innovation process means companies have on-demand access to their customers.
2. Members have a seat at the table
If you want members to be part of your community discussions, you need to provide them a seat at the table, which means making sure they understand how to provide you with feedback and encourage them to do so. Many communities already give members a platform and showcase their value through various programs, survey lists, and net promoter scores. But that’s insufficient. To positively draw from your members’ expertise and knowledge, you have to make sure each person is included — not just your MVPs or most vocal members. An online community platform provides an opportunity for members to gain more insight and have a larger role. Empowering members to give you feedback, shows them that you listened and that it was helpful, is empowering and empowerment is a powerful motivator. Moreover, online customer communities allow businesses to authentically engage and forge a more meaningful bond with customers.
3. Reduce Cost, yet increase operation
Some types of online communities enable customers to seek help from customer service teams or from other consumers in open forums. This generates a win-win situation as clients quickly receive answers and solutions to their questions and problems while reducing customer service costs for companies. Moreover, you can provide more information to all customers, rather than just one-on-one with a customer.
4. Mobilize a community
An online community brings people together, whether it is volunteers, colleagues, or customers. An online community provides a platform where ideas can be shared and heard, knowledge can be transferred and communication can be enhanced through instant messages or posts. Moreover, it provides flexibility, people can communicate from anywhere to anytime. This allows people from all over the world to still be able to connect with each other no matter the place or time.
How Open Social encourages customer feedback.
We utilize our own community platform and have created Community Talks by Open Social (previously called Let’s Get Open Social – LGOS). We created this community for all our Open Social community managers to create a space to connect, help and learn from each other. Where they can ask their fellow community managers for advice or simply share their success stories. Community Talks also provides guides on how to construct, set up, and run your own Open Social community platform. Community managers can find answers, examples, and guidance – and if they can’t find, they can contact the open social team directly on the platform.
Moreover, we use the feedback tool Pendo for our customers to see our features roadmap and for customers to provide feedback with features they believe can improve our and their platform. As we develop features with regard to the client feedback and votes we receive on Pendo. Thus, we create a platform that represents our vision and needs as well as our clients.
Another tool we use in the Open Social Platform is a net promoter score integration, so that every quarter our customer can rate us and give us feedback. It is a commercial yet useful tool to receive immediate measurable feedback. A score does not say much, but it says something. It gives us the opportunity to see the client’s happiness in numbers, and thus allow us to connect with them and see how we can improve their happiness.
To find out more about what Open Social can do for your organization, you can easily schedule a one-on-one demo and we can show you all the features (and also what Open Social would look like branded for your organization!)