What is Feedback Loop? Definition, Importance, Types, and Best Practices

Struggling to connect with your customers? Read the blog to learn how feedback loops can solve your problem!

Author

Godi Yeshaswi

Date

April 12, 2024

You put a lot of work into making a new product and start with a big splash, but no one seems to care. It's tough, right? Think about how many times you roll out something new only to hear nothing back from your customers. Usual marketing ways might hint at what could work, but they miss out on what really matters to your customers - their problems, what annoys them, and what they truly want. 

98% of buyers read online reviews before making a purchase decision.—eMarketer and Bizrates

This blog looks into how important feedback loops are in getting to know your customers better. They are key to getting non-stop insights from your customers that will change the way you make products and turn silence into applause.

What is a Feedback Loop?

A feedback loop is a never-ending cycle of picking up what customers think, making your product or service better with that info, and then checking how those tweaks did. It's like a chat with your buyers that helps you stay on course and give them what they really wish for.

Think of it this way: You're creating a new kind of laundry soap. You mix a strong cleaner, but is it soft enough for fine clothes? Will people like how it smells?

The Feedback Loop helps you figure out these things before you start selling. You can ask people what they think through surveys, live interviews, and focus group discussions, or you can simulate your packs on market research tools and gather unbiased feedback using Emotion AI and Behavior AI.

  • Does the mix clean different kinds of stains well?
  • Is the smell nice, and does it last?
  • Is the bottle easy to use, and does it look good?
  • Is the logo placement on the packaging up to the mark?

By listening to what people say, you can make your soap better, making sure it cleans well but is still kind to clothes. This not only leads to a better soap but also makes customers trust and stick with your brand.

The Feedback Loop isn't just a one-time thing. It's an ongoing chat that lets you change and better your products over time. Imagine discovering people really want a soap that's better for the planet or discovering a specific smell that brings back happy memories for many customers.

Importance of a Feedback Loop

85% of small and medium-sized enterprises say that online customer feedback has been beneficial to their business.—Barclays. Here are 5 reasons why the Feedback Loop is important in building brands: 

Make Products People Really Want 

No more Guessing! The Feedback Loop lets you know what your customers like, so you don't waste time and resources on products no one buys.

Find Great Ideas 

Sometimes, customers come up with amazing ideas you hadn't thought of. The Feedback Loop helps you find these great ideas, keeping you ahead of others.

Keep Customers Happy 

Listening to your customers and making changes for them means they feel important and listened to. This leads to happier customers who stay with you longer.

Save Money & Time 

Think about launching a product that fails. The Feedback Loop helps you catch problems early, saving you money and time.

Build a Strong Brand 

By always offering products and services that meet what your customers want, you build trust and loyalty. This means a stronger brand and customers who come back.

Remember, the Feedback Loop is not just a one-time thing. It needs you to keep at it. But, the good things that come from it - happy customers, a business that does well, and knowing you're making a real difference - are totally worth it.

Positive and Negative Feedback Loop

There are two main types of Feedback Loops at play: positive and negative.

What is a Positive Feedback Loop? - When More Consumers Bring More Consumers

Imagine you start a social app with a cool new feature everyone loves. It goes big. People talk, user numbers jump, and more people join because of the buzz. This is a good loop. The first win (more people) leads to bigger wins (even more people). It's like a snowball rolling down a hill, growing with every turn.

Why is it good for your company?

  • Quick Growth: Good loops can shoot your product or service up fast.
  • More People Know You: The buzz from a good loop gets your brand out there, pulling in new customers on its own.

What is a Negative Feedback Loop? - When More Problems Push People Away

Now imagine your social app often breaks. Users get disappointed, leave bad reviews, and tell others to stay away. This starts a not-so-good loop. The first issue (the bug) means fewer users, which then keeps even more people from joining. It's like a bucket with a hole – the more water goes in (problems), the faster it leaves (customers).

Why is it good for your company?

  • Heads Up: Not-so-good loops show issues before they blow up, giving you a chance to fix things.
  • Better Quality: Catching problems early lets you make your product or service better, leading to happier users in the end.

Both the positive and negative feedback loops give important clues. Positive feedback loops show what's going right and can make growth fast. Negative feedback loops, though tough, are alerts that let you fix things before they get worse. The trick is to watch for both and use them well to keep talking to your customers smoothly!

Steps of Feedback Loop

We've talked about the power of the Feedback Loop, and those ongoing conversations with your customers keep your products and services on track. But how exactly do you put this conversation into action? 

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Here's a breakdown of the 4 key steps involved, complete with a fun media and entertainment example to illustrate each one:

Steps of Feedback Loop

Step 1: Ask Good Questions

Think you're making a new space TV show. You've got a cool story and great effects, but will people like it? You need to ask them the right stuff.

Surveys: Put out online surveys to find out what kinds of space stories, characters, and effects people like.

Focus Groups: Talk to space show fans to hear what they’re really into and what they hope to see.

Media Testing: Use AI-powered consumer research tools to test how many consumers might like different parts of the story or the characters, using tech that watches how they react without them saying a word.

Step 2: Listen and Think About the Answers

After you get answers from your surveys, FGDs, or media tests, dive into what they mean. It's not just about tallying up yeses or nos; it's about getting why people feel how they do.

With our space show example, maybe people are more into stories about the characters than just lots of action. They might like a good puzzle more than space battles.

Step 3: Make Things Better with What You Learn

Now's the time to use what you've learned to make your TV show even better.

For the space show, the writers might focus more on making cool and deep characters and weaving in a trickier puzzle. The effects folks might go for less boom and more beauty, making a world that wows but also feels right.

Step 4: See How It Went and Do It Again

Now, put your show out there and watch what happens. Check how many watch what they say online and listen to their likes and dislikes. Did your tweaks hit the mark?

Keep the chat going. Even if people dug the character stories but guessed the puzzle too easily, take that and think up new surprises for the next season. Keep tuning in to what your watchers say, and keep making your space show better and better!

Add Feedback Loops To Your Product/Service with Decode

Feedback loops are key to growing your products and making your customer experience better. Bringing all your feedback together and looking at it to boost your overall CX is crucial - which is why it's essential to have a tool that can make this process smoother.

Decode, an integrated consumer research platform with Insights AI, has many features to help businesses set up an effective feedback loop.

Interested to know how? Book a demo now!

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Want to conduct lean and unbiased research? Try out Entropik's tech behavioral research platform today!
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Frequently Asked Questions

What are some examples of feedback loops?

Here are some examples of feedback loops: employee feedback loop, product feedback loop, pricing feedback loop, commercial feedback loop, etc.

What are the two types of feedback loops?

The two types of feedback loops are - positive feedback loops and negative feedback loops.

What is the most common type of feedback loop?

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The negative feedback loop is the most common type, as consumers reach out to companies to complain and not to praise (which is very rare). 

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With lots of unique blocks, you can easily build a page without coding.

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Click on Study templates

With lots of unique blocks, you can easily build a page without coding.

3

Start from scratch

With lots of unique blocks, you can easily build a page without coding.

4

Add blocks to the content

With lots of unique blocks, you can easily build a page without coding.

5

Saving the Template

With lots of unique blocks, you can easily build a page without coding.

6

Publish the Template

With lots of unique blocks, you can easily build a page without coding.

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Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat. Aenean faucibus nibh et justo cursus id rutrum lorem imperdiet. Nunc ut sem vitae risus tristique posuere.

With lots of unique blocks, you can easily build a page without coding.

2

Click on Study templates

With lots of unique blocks, you can easily build a page without coding.

3

Start from scratch

With lots of unique blocks, you can easily build a page without coding.

4

Add blocks to the content

With lots of unique blocks, you can easily build a page without coding.

5

Saving the Template

With lots of unique blocks, you can easily build a page without coding.

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Publish the Template

With lots of unique blocks, you can easily build a page without coding.

Author Bio

Yeshaswi is a dedicated and enthusiastic individual with a strong affinity for tech and all things content. When he's not at work, he channels his passion into his love for football, especially for F.C. Barcelona and the GOAT, Lionel Messi. Instead of hitting the town for parties, he prefers to spend quality time cuddling with his Golden Retriever, Oreo.

Godi Yeshaswi

Product Marketing Specialist

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