Close the loop, how does it work?
After conducting a customer satisfaction survey, you would be very wise to do closing the loop. But what does this term mean and how does it work?
What is closing the loop?
Closing the loop is a process by which you respond directly to your customers’ feedback.
A company that deals decisively with the feedback they receive will give customers the feeling that they are really cared about. A customer sees that any complaints are resolved and is more likely to return.
Detractors (dissatisfied customers) can therefore become satisfied customers. Passives (customers who are neither satisfied nor dissatisfied) can become promoters of your company through a ‘Closing the Loop’ process. They will bring in more new customers.
Immediately after collecting feedback, complaints or other relevant data, you can reconnect with your customers by contacting them directly. Whether this involves dissatisfied or very satisfied customers (those potential promoters), a personal conversation will be highly appreciated. Especially if you can get direct results from it, for instance by solving a problem with the customer or addressing certain comments they left in the customer satisfaction survey.
Why is it important?
It sounds so great, that ‘closing the loop’ process. But what are you actually doing it for?
Just listening and asking for an opinion is not enough – just like managers, customers also want to see results. And results are exactly what the whole ‘closing the loop’ process is about. The closed-loop process has a number of goals:
- Show that you care about the customer;
- Discover why your customer is (un)satisfied;
- Improve the customer experience;
- Take advantage of promoters;
- Prepare the customer for the next loop.
Show that you care about the customer
The customer has taken the time for you to fill in a questionnaire. Show that you appreciate this. The first and most important thing is to thank them. Next, exceed expectations by showing that you not only listened, but also made changes as a result of their feedback.
Discover why your customer is (un)satisfied
To increase customer satisfaction, it is necessary to understand what drives your customers. Why would they recommend or not recommend your company? Regardless of the number of questions in the questionnaire, or how you have designed the questionnaire, you will never find out all the motivations. Instead, keep the questionnaire short and follow up with customers, using a closed-loop process. This will allow you to complete and better understand the motivations/motivations.
Improve the customer experience
To increase customer satisfaction, it is essential to understand what drives your customers. Why would they recommend or not recommend your company? Regardless of the number of questions in the questionnaire, or how you have designed the questionnaire, you will never find out all the motivations. Instead, keep the questionnaire short and follow up with customers using a closed-loop process. This will allow you to complement and better understand the drivers/motivations.
The experiences the customer has with your company during the customer journey has a direct impact on his/her loyalty. Use customer feedback not only to identify issues, but especially to fix issues that lead to more promoters. A closed loop can increase your company’s customer retention by an average of 10%. A 5% increase in customer retention leads to a 25% – 85% increase in profits (Zero Defections: Quality Comes to Services). Closing the loop definitely pays off, if done properly.
Benefit from promoters
A promoter is very likely to recommend your company to friends and family. Use the ‘closing the loop’ process to get your promoters to arrive with new customers. Share their opinions about your company online (website, social media, case studies, etc.), ask them to help with case studies or involve them in the product development process.
Prepare the customer for the next loop
Let the customer know that they too will benefit from closing the loop. This makes them more likely to participate again in the next round of the customer satisfaction survey. Research has shown that closing the loop makes customers 21% more likely to participate again.
What should you look out for in a ‘closing the loop’ process?
So what makes such a ‘closing the loop’ process successful?
Decisiveness is important after a customer satisfaction survey. So try to “close the loop” as quickly as possible. It is best to do this within 48 hours, when the customer himself or herself is still fresh in his or her mind about what the questions from the survey looked like.
Put someone within your company, for example the account manager, in charge of the ‘closing the loop’ process. This person makes the contact and then ensures that a complaint is processed right away, so there is tangible result for the customer.
Every company has customers who represent a higher value than other customers. Customers who represent a higher value therefore also have a higher priority in the ‘closing the loop’ process.
Macro vs. Micro
Ultimately, the ‘closing the loop’ process is about putting down results that have an impact. The greater the level at which you make the changes and produce the results, the greater the effect. So focus on macro-level feedback first, before focusing on the micro-level.
Put technology to work
After prioritising your customers and balancing macro-level against micro-level, you can save time and money by using technology to improve the customer experiences of low-value customers.
Not looking but doing
Data from customer satisfaction surveys is hugely valuable. The moment you have conducted such a survey, you really have to use that data. To bring about changes, to achieve results. And not just to look at and analyse.
Want more information on how we measure customer satisfaction? Then click here.
Junior Project Manager