The basics of customer feedback

First things first, let’s cover the fundamentals of customer feedback and the key terms and tools for you to familiarise yourself with.

  • How to measure customer happiness
  • What’s the difference between a survey, feedback, testimonials and online reviews
  • Are feedback surveys classified as marketing communications? 
  • How do feedback surveys fit into an overall communication strategy, without customers feeling like you’re over-communicating or ‘spamming’ them?
  • Why monitor online review sites? 

How to measure customer happiness

Net Promoter Score (NPS)

The NPS system was created by Bain and Company (a global consultancy) and is based on asking your customers one simple question: ‘How likely are you to recommend us to your friends and family?’. This question will help you to evaluate if you’ve done a good enough job to get word of mouth recommendations, which is a key way to attract new customers.

Customers can answer by choosing from a number from 0 (not likely) to 10 (likely). Anyone that scores you 0-6 is a ‘detractor’, 7-8 a ‘passive’ and 9-10 are ‘promoters’. 

NPS is then calculated by subtracting the percentage of detractors from the percentage of promoters. An NPS between 0 - 30 is considered good, over 50 is considered excellent and above 80 is world-class. For comparison, Telco companies typically sit at around 0 or in the negatives, which means they’ve got more detractors than promoters... insert ‘surprised’ gasp here.

Customer satisfaction (CSAT)

CSAT is short for Customer Satisfaction, which is a commonly-used key performance indicator used to track how satisfied customers are with your products and/or services.

CSAT is measured by one or more variations of this question, which usually appears at the end of a customer feedback survey: “How would you rate your overall satisfaction with the [goods/service] you received?”

Respondents can answer using the following 1 to 5 scale:

1. Very unsatisfied

2. Unsatisfied

3. Neutral

4. Satisfied

5. Very satisfied

CSAT is then calculated by taking the ratio of satisfied customers over the total i.e. Number of satisfied customers (those who selected 4 or 5) / Number of survey responses) x 100 = % of satisfied customers.

Review star rating

Customers are pretty used to providing feedback with a star rating along with a review. It involves choosing from one star (poor) to five stars (excellent).  It doesn’t provide a whole lot of information on its own, as people have different opinions of what ‘excellent’ means to them.  

What’s the difference between a survey, feedback, testimonials and online reviews?

A survey is a method of gathering information from people, by asking them a series of questions.

Feedback is helpful information and thoughts provided by customers, about your product or service.

Testimonials are curated statements from customers that endorse your business and support your credibility. They are gathered, owned and managed internally by your business.  

Online Reviews are written by your customers based on their experience with your business. They are collected and managed by third parties (such as Yonder or Google), without the business being involved in the process. 

Are feedback surveys classified as marketing communications? 

Learning about your customers' experience is an essential part of delivering a service, which is why it's not considered ‘marketing’, and opt-in is not required, i.e. you don’t need to ask permission before sending a survey to them.  However, if the communication you’re sending them includes marketing type content included in it, such as offers, then opt-in is required. 

How do feedback surveys fit into an overall communication strategy, without customers feeling like you’re over-communicating or ‘spamming’ them?

We often get asked if you should send a post-service email and a customer feedback email?  Our experience shows that the more call to actions you try to cram into an email, the less likely you are to achieve any of them. If the goal of your email is to gather as much feedback as possible, focus on just that, and design the email in a way that will help you achieve that objective as best possible.  

So yes, send multiple emails with different objectives, but timing is everything! We advise sending a customer survey within a few days of completion of services, no later, before people forget or lose interest. For tourism businesses, the evening of departure seems to get the best results because it’s fresh in the customer’s mind and it’s at a time of day they’re in a position to respond. Make sure you set up your surveys and marketing communications to go out at different times to avoid clashes.

Why monitor online review sites? 

Customer feedback helps you understand what your businesses strengths and weaknesses are, and how customers perceive you. 

Online reviews are a form of customer feedback that are collected and managed by third-party review sites. If you’re not actively monitoring online review sites, you’re missing out on valuable insights, and if you’re getting negative reviews that you’re not aware of and are not responding to, this can be hugely detrimental to your business.  

Not only does monitoring online review sites give you a full picture of what your customers are thinking and feeling, but it’ll also help you determine which channels are giving you the best word of mouth marketing.

We know it can be pretty time-consuming monitoring online reviews, especially given there are so many sites that customers can post reviews on, but it doesn’t have to be. With software like Yonder, you can easily pull all your feedback into one place, and track all of your online reviews with a click of a button.

This article is an excerpt from:

How exceptional businesses use customer feedback to grow

Whether you’re new to customer feedback or you’re wanting to improve how you gather, analyse and act on it, this handbook will be your go-to.

While collating this handbook, we interviewed small, medium and large businesses - all leaders of businesses providing a service. Our goal of the handbook is to help you have the knowledge and tools to deliver great customer experiences, knowing that nurturing raving customers is the best way of sustaining and growing business

Get the guide