It’s no secret that customer feedback is some of the most useful data you can collect as a small business owner. Being that your customers are the exact same people buying your products and soliciting your services, they are exactly the people whose feedback, then, should matter the most. It is equally not a secret, however, that customer feedback can be very difficult to collect, or more specifically: customer feedback is most helpful in larger and more consistent quantities. It’s no wonder mega-corporations like Amazon and Walmart have dedicated teams who synthesize internal customer feedback data; but what does all of this mean for small business owners? Collecting customer feedback can make a drastic difference in your bottom line and help you usher out or in new products and services specifically for your customers. This is the main reason small business owners ought to know the ins and outs of a “customer feedback loop” and sustainable means to create one for your business.

What is a Customer Feedback Loop and Why Do You Want to Create One?

A customer feedback loop draws on the scientific concept of a feedback loop in which two related objects act in response to each other and have a mutual impact. A customer feedback loop, then, is a means for a business to maintain that same mutual impact with their customers by acting on their feedback. The “loop” essentially means a grand return to equilibrium. But in the case of the business-to-customer relationship, that equilibrium lies more often with the customer than the business. A customer feedback loop means that customer feedback is acted on directly and that their recommendations or complaints are alleviated, thus, returning the customer to an “equilibrium.”

Maintaining a healthy customer feedback loop is a sign of a healthy business. Plus, the best way to collect meaningful customer feedback is having customers believe their feedback will be taken seriously. If customers believe their suggestions are being sent to an unmonitored inbox or are being summarized into “good” and “bad,” it is exceedingly unlikely your business will ever reap meaningful feedback. A healthy customer feedback loop begins with businesses making a concerted effort to communicate with customers, hopefully creating a more engaging relationship with your business.

Elements of a Feedback Loop and How to Harness Them

Collect Your Data: The best advice we can give: start small. Collecting customer feedback can be done on the personal level or with digital outreach. Depending on the size, style, and scope of your business, your method of collection will vary: if you are a brick-and-mortar store, you can collect your data directly on your premises, or you can utilize technology. If your business works online, use already existing points of online engagement to collect your data. There is a wide assortment of tools that are economical and user-friendly that you can leverage  to streamline feedback collection.

Several marketing and customer relations experts have weighed in over time explaining what style, length, or feel of questions resonate strongest with customers. Some think broad 1-10 questions get to the root of systemic issues in business while others invite open-ended personal responses from customers. There is no wrong way to collect feedback except for failing to respond and act on that feedback. As the business owner, you (and your team, if applicable) need to  feel out what style of questions would best engage your audience and what style of question may bring in the best answers. This process ought to operate as trial and error; like a customer feedback loop itself, improve your questions and quality of surveys as you continue to offer them to your customers.

Process Responses: Following your first round of feedback, share results widely throughout your business. Small businesses collecting data on the individual level with their customers don’t need an algorithm machine to tell them what each piece of feedback says, sit down and read each and every piece of feedback. Show that data to all front of house and customer-facing staff as well and make a daily, weekly, or semi-regular ritual of reading customer responses together with those relevant parties.

Sort out your responses and customer data in a thoughtful system which makes it clear what data you have responded to directly or acted upon and what remains unchecked. As explained above, acting on that feedback is essential in granting customers the confidence and faith that their feedback is both worth them writing and worth your reading.

Close the Loop: Individually thank each customer who has given you feedback. No matter if you collect your feedback in person or digitally, respond to their feedback with both a genuine recognition of the importance of their feedback as well as a specific reference to a comment from their feedback. This may sound obvious to any small business owner who has dealt with responding to customers in the past but this point bears repeating as your feedback loop becomes more successful and more feedback comes in, it is essential that you and your team give the same dedicated level of care to each and every response.

In order for a feedback loop to be truly successful, however, business owners must make genuine changes or reparations in response to feedback. Here is a broad example: if customers are disappointed with the lack of loyalty perks and programs, you must close that loop by giving a valid explanation as to why an enhanced loyalty program can’t exist right now and/or  to create and advertise new loyalty  programs and explain to those customers that their feedback inspired the system. Herein lies the most taxing part of a customer feedback loop: there are no shortcuts and no workarounds. Business owners and relevant parties must act on feedback in a way that displays to customers that their feedback is valuable; this is the only way to close the loop.

Good and Bad Feedback Makes a Business Better

Think of the customer feedback loop this way: when a customer submits feedback, they open the loop. That loop then isn’t closed until the business owner or relevant parties prove to the customer that their feedback was meaningfully processed and will have an impact on the future of the business. It truly doesn’t matter if the customer’s feedback is good or bad; business owners who run a thoughtful feedback loop system ought to be grateful for every piece of feedback, positive or negative as that shows customers are both actively thinking about your business and are inspired enough to  know how they feel about your business. Better than being lukewarm, customer feedback shows that your business is making an impact, so it’s on you to prove to your customers that their time spent creating feedback wasn’t wasted. In a way, it’s “their” business as much as it is yours, so make your customers’ impact visible and authentic.