The Importance of Closed-Loop Feedback

Today, obtaining feedback through the use of online and offline surveys has become a growing practice for thriving businesses. With the modern customer’s high demand for personalized experiences and more tailored products and services, feedback has become a central component in delivering an exceptional customer experience that outweighs competitors.

However, while many businesses cite having a feedback program in place, many of them fail to act on the feedback gathered or utilize it in a manner that retains customers – otherwise known as closing the loop.

In this article, we’re taking a closer look at what it means to close the loop, how businesses can benefit from it and how to implement it effectively.

What is closed-loop feedback?

Closed-loop feedback is when a business responds or takes action on customer feedback submitted through an online or offline survey. By “closing the loop” businesses manage feedback in a timely and effective fashion, directly or indirectly addressing customer concerns or praises to secure a positive customer experience.

A common misconception with closed-loop feedback is that it has to be dealt with in -person, 1:1 with the customer. Although in-person communication has its benefits, by simply correcting an issue or addressing an opportunity, online or offline, you can close the loop.

As a process, closed-loop feedback begins with a business creating a survey with the customer top of mind. Once the survey is created and dispersed to customers, they provide their feedback and the business collects and analyzes the data. Closing the loop comes in when you identify issues or opportunities within the feedback and take the appropriate steps to recover or retain the customer (See Figure 1).

Figure 1

Benefits of Closed-Loop Feedback

When it comes to closing the loop and following up with customers, there are a number of benefits a business can experience. Here we highlight the top ones.

Increased Customer Loyalty

In the modern marketplace, there are a plethora of brands to choose from with very similar offerings and competitive pricing. This makes it more challenging than ever to retain customers and build brand loyalty.

By closing the feedback loop through a simple follow-up or a meaningful action you encourage a positive experience that leaves the customer feeling valued. The more positive the sentiment the greater the incentive they have to stay with your brand and a greater opportunity to build a solid relationship.

Improve Employee Performance

Closed-loop feedback is a great opportunity to optimize employee performance. Although feedback, in general, has been known to improve employee productivity, closed-loop feedback ensures employees learn from mistakes and take the appropriate steps to recover any at-risk customers. What’s more, having a sense of immediacy to respond to feedback ensures that employees are made aware of their errors while it is still relevant and memorable.

Closed-loop feedback can additionally aid employee performance when paired with a technology solution. Through a solution, brands can track employee progress and mitigate any recurring issues over time. The moment an issue or opportunity arises, teams can recover recovered and you can measure retention at that exact moment – an optimal quality to build future strategies and map long-term success.

Reduce Negative Verbiage

According to PwC 32 percent of customers would stop doing business with a brand they love after a single bad experience. What’s more, the American Marketing Associates reported that people tend to mention a good brand experience to an average of nine people, but will talk about a bad one to 16 people.

Regardless of the industry, having a positive brand reputation is monumental for bringing in more customers and maximizing revenue. With closed-loop feedback, you can follow up immediately so upset customers are recovered before they have a chance to go online and spread negative verbiage. Even if you’re unable to solve the issue at hand in real-time, acknowledging the customer and showing them your appreciation for their feedback will go a long way in reducing negative sentiment.

Maximized Revenue

When customers provide their feedback, they identify gaps in service and operations that you might have otherwise overlooked. By obtaining feedback on a consistent basis and making immediate adjustments you can improve the overall experience so customer sentiment is always optimized and revenue is maximized.

What To Look For In a Customer Feedback Solution

When it comes to closing the loop with customer feedback, doing it in an efficient manner is paramount to ensure you’re receiving optimal results. This can be done through the implementation of a fortified customer experience solution. However, not all solutions can promise great results, which is why in this portion of the article we go over the top qualities to look for in a feedback solution.

Immediate visibility

When it comes to response times, customers have high expectations. This is why when looking for an ideal customer experience solution, having real-time feedback is critical.

With a CEM that offers real-time insight, employees can instantly see responses and close the loop in-the-moment. This has tremendous benefits for not only improving the customer experience but also deterring teams from adopting bad habits. What’s more, with immediate visibility teams can feel more urgency to recover customers and get the job done right – which can gamify work functionalities, improve motivation and create greater enthusiasm.

Automation Capabilities

When it comes to closing the loop in a fast and efficient manner, automation can help substantially. Using automation, customer issues that require immediate attention can be routed to the right department and the right seniority level, in real-time. This ensures that customer concerns are addressed in a timely manner with the least amount of uplift.

What’s more, using automation can help teams send out their surveys on a consistent basis. Whether it be pre-visit, on-site, or post-visit, with an ideal CEM a team can queue surveys so they don’t have to worry about sending out surveys all the time.  

Advanced Reporting Capabilities

In order to accurately respond to customers and identify the best solution, reporting and analytics are an absolute necessity. Through timely and accurate reporting, businesses are more strategically equipped to handle customer concerns and resolve recurring issues by immediately closing the loop. What’s more, reporting and analytics can help hold teams accountable for their service. When looking for a CEM solution that suits your needs, be on the look-out for capabilities like sentiment analysis, heat-maps, location comparison, daily summaries, KPI’s, and more. Having a range of capabilities can make sure you’re closing the loop in the most effective way possible.

A great example of the power of reporting can be seen with Loop® client A&W. Provided with a range of advanced reporting analytics, they found that Loop’s at-a-glance heat map view was a critical tool for helping managers identify specific periods when Loop ratings were unusually high or unusually low. Using the heat maps, managers were able to use the data to pinpoint causes behind variations and devise strategies to replicate success and improve on weak results. Helping improve customer experience and streamlining operations.


As customer’s expectations change and new tech mediums are introduced, a customer experience solution should be able to adjust accordingly.

Responding to a customer on the feedback channel of their choice elicits a more positive response. This means that as your customer’s channel preferences grow, so should your solutions. When looking for a fortified CEM, consider the number of product updates the solution requires, the uplift needed to update or implement the solution, and the vendor’s plans for future integrations. A brand that offers only traditional channels to engage with customer feedback, like email and text, with no actionable plans to adopt social channels, won’t be scalable for the future of your business.

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