Today’s consumer has incredibly high expectations of the brands they spend their time and money with. Consumers realize they are not beholden to brands as options arise across the ever-expanding market of goods and services, and brands have begun listening to customers to help drive their product roadmaps, and ultimately, to drive success through loyalty. Going one step further, customers no longer only compare brands to their direct competitors; they compare their experiences to the best customer experience they’ve ever received, which sets the bar even higher.
But even though today’s brands are wising up to the importance of listening, a gap still exists between customer feedback and how brands act on it. According to a new report from Gladly, 92% of customers say they would stop purchasing from a company after three or fewer poor customer service experiences, and 26% of those would stop after just one bad experience. Listening to and acting on feedback shows respect, and quite frankly, today’s consumers don’t have the time or patience to deal with brands who don’t respect them.
Luckily, there is a way to bridge the communication gap between consumers and brands: collecting customer feedback directly, from wherever your customers are.
Here are four reasons why collecting (and acting on!) direct customer feedback is so powerful.
1. First-party data is the most reliable source of feedback.
We’ve all played the telephone game. At first, the message keeps its sentiment and is clear, but the more layers it passes through, the more distorted and less useful it becomes. The same is true for asking customer feedback: When you rely on third-party data about your customers to help drive your decisions, you miss out on critical details that can help you explain the feedback. Going directly to the source—your customers—provides data that is less nuanced and muddled.
First-party data also removes the financial risks associated with relying on third-party data. Third-party data is often oversold, stale, and even becoming illegal to ask for and use thanks to legislation like GDPR. Using first-party data is a smarter, safer approach when your revenue is on the line.
2. There are more access points to feedback than ever before.
In today’s connected landscape, there are more ways than ever to connect with customers and ask them how they feel. Between a connected “Internet of Things” and more edge devices than we can count, passing protected, direct customer feedback to brands can be done wherever customers are, whenever they’re there.
Regardless of industry, brands have the ability to get in front of customers in a non-intrusive way for feedback. And not only is it possible, it’s expected. Apptentive data shows that customers expect to be interacted with, and those interactions heavily influence retention: 51% of consumers expect companies to ask them for feedback directly, but left unprompted, companies typically only hear from ~1% of their customers. Although asking for customer feedback can still seem challenging, the way our world is connected today has removed almost all the barriers to making one-to-one customer connections.
3. Feedback helps marketers be dollar efficient.
Marketing efficiency has always been important, but today’s marketers have so much data to act on that risks are higher than ever. Between having too many advertising options to choose from, brand awareness work that needs doing, endless content marketing projects to tackle, and finite resources to handle it all, marketers search harder than ever to find dollar-efficient strategies.
Customer feedback is the silver bullet to cut through marketing noise as it can help you predict the future when creating new strategies, especially for brands in the service industry.
4. Retention is still the most important marketing metric.
When it comes to selecting the most important marketing metric to gauge your success, retention is still number one. New research from Forrester shows that 78% of those who feel positive about a brand will stay with it, 81% will spend more on it, and 90% will recommend it to others. Retaining customers is still the most effective way to make your marketing dollars stretch as you can spend less on acquisition, and higher retention translates directly into more revenue.
Consumers’ expectations for how brands handle feedback has changed, and the companies who don’t prioritize listening to customers are already falling behind. Acting on customer feedback is what will set the next generation of great companies apart from their competition.
But as important as prioritizing feedback is, we know it can be tough. Imagine being able to visualize customer sentiment by loyalty level, store, geographic location, or any other dimension that matters to your business—even down to an individual customer. At Apptentive, we’re already working on it. We’re excited about what’s next in our product, and can’t wait to help you turn your digital experiences into customer feedback channels.