Customer feedback is information coming directly from customers about the satisfaction or dissatisfaction they feel with a product or a service. Customer comments and complaints given to a company are an important resource for improving and addressing the needs and wants of the customer. The information is procured through written or oral surveys, online forms, emails, letters, or phone calls from the customer to the company.

Any company that runs any form of service to people, whether large or small, knows the importance of customer feedback. Equally well-known is the difficulty involved in generating quality customer feedback. As the saying goes, “For every customer who bothers to complain, 20 other customers remain silent.” Unless the experience is really bad, customers usually don’t bother to share feedback about an experience that didn’t meet their expectations. Instead, they decide never to do business with the service provider again. That’s a high price to pay for lost feedback.

Ross Beard writes Customer feedback is so important because it provides marketers and business owners with insight that they can use to improve their business, products and/or overall customer experience.The following are the top six reasons why customer feedback is important to your business.

1. It can help improve a product or service: Listening to your customers is the only way to guarantee you create a product or service that they actually want to buy. Customer feedback is commonly used throughout the product development process to ensure that the end product is something that solves a customer’s problem or fulfils a need.

The most innovative companies in the world are the best at creating products that meet their customers’ needs and exceed their expectations. Think of Apple, Virgin and Dell.

In today’s competitive business world, these companies who can intertwine product development and customer feedback will be the ones that reap strong competitive advantages, have sticky customer loyalty and earn raving customer advocates.

2. It offers the best way to measure customer satisfaction: Measuring customer satisfaction helps you determine whether your product or service meets or surpasses customer expectations. Customer feedback surveys help you measure customer satisfaction.

These can be done in person, via email, via the phone or even inside a website or mobile app. Using rating-based questions when you are measuring customer satisfaction will help you track and monitor how happy (or unhappy) your customers are over time.

3. It provides actionable insight to create a better customer experience: improving the customer experience should be the primary reason you gather customer feedback. The process of winning new business and retaining existing customers is getting harder and harder. Offering an amazing experience that keeps your customers coming back and referring their friends to you is the best way you can stand out from your competition.

To create an amazing experience, you need to ask your customers what they want and use the insight to create a consistent, personalized experience. If you can create an experience that is better than your competitors, your customers will remain loyal and ignore tempting competitive offers.

4. It can help improve customer retention: Customer feedback offers a direct line of communication with your customer so you can determine if they are not happy with the product or service you are delivering before you lose their business.

A happy customer is a retained customer. By requesting customer feedback surveys regularly, you can ensure that you keep the finger on the pulse. If a customer becomes frustrated or perceives a competitive offer to be better, they will start exploring their options and may cancel their contract or stop doing business with you. By listening to your unhappy customers, you can use the feedback to ensure all of the customers have a better experience and continue wanting to do business with you.

5. It delivers tangible data that can be used to make better business decisions: The best business decisions are based on data, not hunches. Too many times business owners and marketers make big calls based on inaccurate data. Customer feedback is the holy grail of tangible data. You can gather real insight into how your customers really feel about the product or service you deliver.

Use this feedback to guide your business and marketing decisions. If a large percentage of customers suggest a product feature or want an additional customer service channel, listen to them! Your customers are your livelihood.

6. It can be used to identify customer advocates: Customer advocates are your best marketing campaigns. They offer tremendous value at very little cost. But how do you identify advocates?Customer feedback. When you gather feedback from your customers, advocates are the ones who give you high scores. Contact these customers and build stronger, mutually-beneficial relationships.

Don’t be afraid to ask for a testimonial or referral– more times than not, these advocates want to help you.

Gather customer feedback to improve your business, product, service and experience: Customer feedback shouldn’t be an exercise that you put at the bottom of the pile, outsource to another firm or pawn off to an intern. It’s one of the most important components of any successful business.

Customer feedback provides you with valuable insight into what your customers think about your product or service. This insight can help you create a product that customers want to buy and create an experience that exceeds expectations and keeps customers coming back for more.Remember, there’s never too much feedback – the more the better!

The lost customer is not the only casualty. Studies have shown that each dissatisfied customer typically shares the unsatisfactory experience with 8 to 10 (sometimes even 20) others. With the growing use of social media, it’s not uncommon for negative feedback to go viral and hurt the credibility of a brand.

To address this challenge, companies are finding new ways to engage customers and seek responses. Let’s look at some very effective ways of getting quality customer feedback as shared by CsabaZajdo:

1. Provide Proactive Live Chat Support

According to a survey, 44 percent of online shoppers feel the best feature an e-commerce website can have is a live chat. Live chat can address many issues. For example, it can help customers who are unable to locate the items they seek or answer questions about availability, payment, shipping, etc. Chat support can help a company get closer to its customers by better understanding their needs and challenges. It also helps identify patterns if there are any recurring issues and helps find long-term solutions for those issues.

Online services such as Zopim let you introduce live chats on your website. As with other types of feedback, the quality of your response plays a critical role in achieving optimum results. You should do your best to make sure all customer questions are addressed promptly and with helpful information for your customer. You can increase the efficiency of your online chat by making it proactive: set the live chat window to appear whenever a customer has been reading a page for a long time, for example, 20 seconds. According to statistics, proactively displaying the chat window can increase the number of chats by up to 300%.

2. Get Feedback on Live Chat Session

Just like e-mail surveys, surveys which are sent after you close a ticket in a customer support portal, you can seek feedback after a live chat session has closed. This feedback can include basic questions about whether the chat experience was helpful. This helps you rate the effectiveness of your chat-support personnel. In the case of an unsatisfactory response, prompt action can help you win the customer’s trust.

3. Provide Dedicated Feedback Forms on Your Site

Provide at least a dedicated feedback email—for example, feedback@u.com. If there are any complaints, customers can communicate their grievances through this email. This remains one of the most effective methods of generating feedback. According to a survey, 54% of online shoppers preferred this method of interacting with customer service.

You can take this one step further by providing a dedicated feedback form, placed prominently on your website. As a best practice, the forms should include all relevant questions related to feedback, but should not be too long. Whenever possible, provide customers with multiple options. For greater impact, the email address for feedback or the feedback form should be highly visible on the website.

We should ensure that the questions for the feedback are not too long but straight to the point, remember people don’t have time for things they are not benefiting from.