Truly understanding and responding to customer needs is essential for any successful business, especially in an industry as quickly-evolving as SaaS. 

Most companies understand that customer feedback is crucial for understanding their product and users. However, many fail to realize that collecting feedback is just the start – you need to consistently analyze it, implement changes based on it, keep customers informed throughout the process – and most importantly – close it.

Closing the customer feedback loop by establishing a continuous cycle of gathering input, making data-driven improvements, and communicating those updates is key to delivering outstanding customer experiences, building lasting relationships, and driving sustainable growth. 

In this article, we’ll be going over:

  • What the customer feedback loop is
  • Why the feedback loop is cyclical 
  • How to deal with negative feedback
  • Why you need to close the feedback loop
  • Best practices for managing the feedback loop

What is the customer feedback loop?

When soliciting feedback, be sure to go beyond just asking what customers want – seek to understand the underlying problems they're trying to solve. Don't always do exactly what the customer says. Really think about the problem they're trying to solve. The customer is an expert on the problem, but not necessarily an expert on the solution.=

Why is the feedback loop cyclical?

Treating feedback as a continuous cycle allows you to adapt really quickly to market demands, which is extremely important in SaaS. 

According to Spencer Coon, Co-Founder and COO at Beamer: "Companies definitely need to differentiate themselves and provide solutions that really allow them to retain their customers, and the feedback loop is definitely an integral part of that."

It's the cyclical process of gathering customer feedback, learning from it, building product improvements, updating customers on those updates, and measuring their response to the changes. There are five key stages:

  1. Measure: Look at product analytics, directly solicit feedback through surveys and conversations, offer public roadmaps for users to submit feature ideas, and leverage tools like Net Promoter Score (NPS) to gauge customer sentiment.
  2. Learn: Analyze all the different feedback streams, identify recurring trends and customer pain points, and pinpoint opportunities for enhancements or new features.
  3. Build: Create those product updates, whether they're simple UX improvements or entire new modules or offerings.
  4. Update: Announce the changes you've implemented to customers through varied formats tailored for maximum visibility and engagement.
  5. Engage: Promote the new features, nudge customers to adopt them, and incentivize providing further feedback on the impact.

How to deal with negative feedback

Remember, there's no such thing as negative feedback – it's all an opportunity to show customers you're committed to improving their experience and addressing their evolving needs. If you solve a customer problem quickly, they're often happier with quick and efficient help in resolving that issue than if they'd never had the problem in the first place. Another tip is to always be polite and respectful - even if their tone is a bit negative or abrasive. 

Why you need to close the feedback loop

We've all been in frustrating situations as customers - whether it's a lengthy call to dispute an incorrect bill or receiving poor service. In those moments, we crave having our voices heard and our issues promptly resolved by the company. Closing the customer feedback loop is all about providing that responsive experience.

It means going beyond just collecting customer surveys or comments. Closing the loop requires actively following up when customers flag a problem or poor experience. A company practicing a true feedback loop listens to the customer, acknowledges their pain points, and moves swiftly to address the issues raised.

If a customer indicates dissatisfaction through a survey, the next step isn't just data analysis - it's promptly reaching back out to that individual. The best companies close the loop by directly discussing the challenges, understanding context, and working to rectify the situation through thoughtful action.

Whether it's a phone call, personalized email, or other outreach, closing the feedback loop shows customers that their voices have been heard and that the company genuinely values their perspectives. This personal touch builds trust, strengthens loyalty, and turns frustration into positive sentiment about a brand's commitment to customer-centricity.

Failing to close the loop leaves customers feeling unheard and unappreciated. But a well-executed feedback loop positions companies to recover from missteps, cultivate stronger relationships, and consistently improve experiences through rapid iteration on real voices.

Best practices for managing the feedback loop 

1. Gathering feedback

For creating an effective feedback loop, we recommend a combination of automated tools and direct interactions. You ought to constantly be talking with your customers – this gives them the sense that they're being heard and if they do offer feedback it will be acted upon promptly.

You should try to rely more heavily on automated channels for the initial feedback collection. It removes that bias people often have of not wanting to offend a real-life person. Unsupervised and anonymous feedback is much less inhibited, and it's going to give your product team real and useful feedback to act on.

2. Analyze your feedback

Once you've gathered feedback, you should analyze and sort it on a regular basis. Look for patterns, similar themes, or problems that come up over and over again in customer feedback.

Use tools or software to help you successfully organize and examine the data. This analysis will show you where you can improve or make changes for the better.

3. Assign priorities

Based on the feedback, make a list of things that need care and put them in order of importance, assign duties, set deadlines, and make sure that the required changes are made. Tell your team and your users about the changes and new information. 

4. Relay process to customers

Now, you need to signal to the customer you've received their feedback and appreciate it.

This step is very important because it closes the feedback loop and shows the customer that they have been heard. Tell them that you care about what they have said and that you are taking steps to rectify their concerns or implement their ideas.

5. Communicate changes to customer 

Okay, at this point it's critical you communicate the changes you've made as a result of their feedback. This dialogue builds trust and shows your onboarding program is focused on the customer. 

6. Continuous changes

Repeat the feedback loop method over and over again. Get feedback on a daily basis to see how your changes are working. And find any new areas that need work.

Make collecting feedback a regular part of your customer onboarding program and a key part of the continuous growth cycle. For ongoing progress, it’s important to set up a feedback loop when you're making your customer onboarding program.

To wrap up

Ultimately, closing the customer feedback loop demonstrates your dedication to delivering continuous value and addressing your users' evolving needs and challenges. It builds trust, satisfaction, and longtime retention. Don't let that valuable customer feedback go stale – put it into action through your products and services to keep delighting the people who matter most to your business.