How To Use Closed Feedback Loop Systems? (Complete Guide)

closed feedback loop

Your customers will have opinions about your business and may well want to share their feedback with you. If this is the case, how do you plan on collecting their feedback? And how would you then go about putting it into action?

Any business should prioritize customer feedback.

This is particularly the case with feedback received through support tickets, satisfaction surveys, social media, and emails.

Collecting and analyzing feedback across multiple channels can be a complex and lengthy process. It is therefore essential to get it right.

This is why we recommend you take advantage of the closed feedback loop. But what do we mean exactly?

Let’s take a look into everything there is to know closed-loop feedback.

Table of contents
What are closed feedback loops used for?
What are the benefits of closed-loop feedback?
1. Improve customer satisfaction
2. Make real-time decisions
3. Reduce customer churn
4. Create learning opportunities for employees
5. A closed loop system boosts revenue
6. Improves overall reputation
7. Better employee experience
How to build a closed-loop feedback system?
1. Make feedback-informed decisions
2. Analyze customer feedback
3. Close the loop with detractors
4. Engage with promoters
5. Follow up with passive customers
6. Automate workflow

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What are closed feedback loops used for?

The term “closed-loop” essentially refers to feedback that your business can use to directly respond to its customers.

It’s essential that all businesses close their feedback loop, especially when customers leave negative feedback on their products or services. In order to achieve this, companies need to follow up on customer feedback.

Ultimately, companies that engage in closed-loop feedback put themselves in a better position to collect valuable insights. And, of course, these insights can help a business grow.

In other words, effectively using closed-loop feedback is a great way to keep your customers satisfied, and prevent them from becoming detractors. In fact, this practice can even turn detractors into promoters.

What are the benefits of closed-loop feedback?

Why should you invest in closing the feedback loop? Here are some of the key benefits of closed-loop feedback —

1. Improve customer satisfaction

A closed feedback system allows you to collect customer feedback, so improved customer satisfaction is a given, right? However, you should aim to incorporate that feedback into improving existing CX strategies.

As you receive more feedback over time, you can use that data to continually enhance your goals in terms of customer experience. This will lead to improved customer satisfaction across the board.

2. Make real-time decisions

To improve customer experiences, you have to ensure that customer feedback is reviewed regularly.

This will help ensure that you can make quick decisions in terms of addressing any feedback received.

This is where a closed feedback system helps and all key stakeholders within the company should have access to any feedback data whenever they need it.

3. Reduce customer churn

Are you looking to reduce customer churn? A closed customer feedback loop will help as it informs customers that their feedback has not only been received, but that positive action is being taken to address any issues.

As the feedback is addressed, key pain points and concerns can be resolved. In doing so, you should find that customer experience improves over time. Ultimately, this leads to customers staying with you for longer.

4. Create learning opportunities for employees

Utilizing closed-loop systems when providing employee feedback is a great opportunity to understand how customers feel about specific employees. You can then quickly identify which employees could need additional training.

You’ll also be able to identify any potential gaps in the customer journey. This allows you to work toward improving efficiency at key custom touchpoints.

You employees can be given the opportunity to learn more about your customers and what they need to do to ensure the best CX possible.

5. A closed loop system boosts revenue

As you improve customer experiences, you should find that you get more positive public reviews as a result. When potential customers see positive reviews, it can have a significant impact on building trust.

As a result, you will receive higher numbers of customers and increase your chances of keeping existing customers in the long term. This is how a closed feedback system helps boost company revenue.

6. Improves overall reputation

A closed-loop feedback system ensures that companies understand what their customer base needs. It’s a system that will put you in the best possible position to take action.

As you take action, customers will believe that you’re listening to what they have to say. You may even find that they start to leave positive reviews, thus encouraging others to do likewise. Such a cycle continues to improve your reputation across channels.

7. Better employee experience

We all know that customer and employee experiences are connected. This is because happy employees are more likely to provide a better experience for customers than those who are unhappy.

If your customers are satisfied, it will be easier for employees to focus on their tasks. This is why a closed-loop feedback system not only directly benefits your employees, but also your customers.

closed loop control system, closed loop process, customer service team

How to build a closed-loop feedback system?

Now that you have fully understood the closed-loop feedback system, let us take a close look at the steps required to build one —

1. Make feedback-informed decisions

The very first step in any closed-loop feedback process is feedback collection.

You can use surveys such as NPS, CSAT, CES, and PMF, which can be distributed via email, web, in-app, or through QR codes. Make sure you have a steady stream of real-time feedback before trying to make sense of the data.

2. Analyze customer feedback

The next step is analysis. We highly recommend you use text analysis tools that can automatically analyze unstructured or open-ended survey responses.

These closed-loop feedback solutions can perform both sentiment analysis and topic analysis among others. Most importantly, your solutions can be custom-trained to meet the specific analysis criterion of your company.

3. Close the loop with detractors

Next, you will have to follow up with your detractors and close the loop. These are people that are the most unlikely to recommend your brand.

You will have to reach out to them individually and address their negative feedback quickly. The best way to do this is by sending the feedback through communication tools so the right customer service team deals with any detractors.

4. Engage with promoters

Once you deal with detractors, you should move on to promoters and engage with them e.g., by asking for testimonials or reviews.

You can follow up with promoters by asking for word-of-mouth recommendations in return for referral incentives. Positive survey responses will follow. You might also think about inviting promoters to special events.

5. Follow up with passive customers

Passive customers are those who leave neutral assessments. Their feedback doesn’t really have the potential to cause your organization any harm, but shouldn’t be ignored as passive customers can turn into detractors.

If tackled quickly, you can turn passives into promoters by following up on their feedback. This can build trust and also generate some crucial insights.

6. Automate workflow

Lastly, you should focus on automating the entire workflow so that your approach to customers can be made more precise.

The best way to go about this is by dividing your process into pre and post-feedback actions.

You will need to understand how you will engage with customers before soliciting feedback and what you will do once you have said feedback.

What are the impacts of a closed-loop control system?

Let us examine how closed-loop feedback impacts various stakeholders.

Impact on customers

Customers are the first to win in a closed-loop feedback system. As you close the loop, customers will find it easier to resolve any issues as they will have received the requested information.

The closed-loop feedback system also makes it convenient for companies to put customers at the center of their business strategies.

In this way, customers will feel valued by their favorite brands, and rest assured that their feedback has and will be effectively incorporated. Closed-loop customer feedback will ensure that any future customers are subject to a more optimized CX design.

Impact on an organization

Besides your customers, the company itself will benefit from building a closed-loop system. This is because all stakeholders in your organization will have access to the feedback loop in real time, giving them the ability to close it quickly.

As a result, your front-line staff will be equipped to provide better individual experiences to customers.

All CX professionals within your company will have a complete understanding of the impact of existing CX strategies, which will help build better strategies in the future.

This will also be bolstered by the fact that feedback systems act as a continuous source of insights.

closed loop control system, customer experience, closed loop feedback program

Best practices for closing the feedback loop

Let us not take a closer look at the possible different best practices that you might follow when closing the feedback loop.

1. Prompt follow-ups

You should avoid wasting time after collecting customer feedback. Switch to action by quickly connecting or following up with your customers.

This not only impresses customers but also gives you enough time to deal with any lingering issues in the customer journey.

2. Real-time tracking of issues

We highly recommend you track customer issues in real time. For this, you should look into investing in high-quality closed-loop customer feedback solutions. These solutions can generate real-time insights and should be tweaked according to your requirements.

3. Turn passives/detractors into promoters

As mentioned earlier, this can be one of the most important steps in the entire closed-loop feedback process. Focus on turning passives and detractors into promoters by dealing with their feedback as a priority.

4. Accurate understanding of issues

Ensure that you have a clear and specific idea of your customer feedback and the relationship customers have with your brand.

An in-depth and accurate understanding of customer issues will go a long way toward enhancing relationships through a closed-loop feedback system.

What to look for in a closed-loop feedback solution?

This is an important question to ask, especially if you are hoping to gain significant rewards out of the process.

Once you put in a dedicated solution, it will become easier to track customer feedback, boost revenue, and protect the reputation of your brand. However, there are several points to check before investing in a closed-loop feedback solution.

The most crucial is the solution’s ability to collect feedback throughout all touchpoints in a customer journey.

Additionally, you should examine the solution’s potential to integrate into your existing work environment. You should also prioritize automation and reporting while ensuring that the solution has an intuitive interface.

Final thoughts

There you have it. We have shared everything you need to know about closing the feedback loop. You are all set to apply these important data insights.

However, you should keep in mind to push toward an efficient closed-loop feedback process that can make all communication between you and your customers much more transparent to help gain the trust of existing and future potential customers.

We highly recommend you take the initiative and conduct surveys to gather first-hand customer data and insights that will bolster your CX and business strategies.

The more you do this, the easier you will find it to delight your customers and make them feel listened to and cared for.

Did you find this post useful? Stay tuned for more informative posts in the future.

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