Opinions of contributing entrepreneurs are their own.
A general advice for entrepreneurs is to build what they personally want, but this can prove to be a path to failure. After all, it is said that 90% of startups fail, and the main cause of those failures is that there is no market need.
From Facebook’s metaverse folly to Juicero’s demise, the story of failed projects is littered with stories of companies that just didn’t understand their markets well enough. While passion, in the words of the late Steve Jobs, is “the only thing that keeps you going” when it comes to the long journey of entrepreneurship, it’s not enough. It’s just as important to understand the wants and needs of your customer base.
This means that customer feedback is essential for entrepreneurs. With in-depth customer feedback, entrepreneurs can better understand their markets and innovate smarter. It can help them develop products that customers really want and need, rather than products that founders think they need.
Here are four ways business owners can use customer feedback to improve their business:
Related: This is why you should never ignore customer feedback
1. Use customer feedback to inform product development
It is also important to use customer feedback for product development. This means that business owners should take the time to read customer feedback and make changes where necessary.
For example, Vlad Tenev, CEO of Robinhood said that many of the company’s product priorities are based on customer feedback. This means the team actively listens to customers and makes changes based on their feedback.
An early feature that helped Robinhood differentiate itself was a “Fractional Share” option, which allows customers to purchase partial shares of stock. Another more recent example is Robinhood’s decision to provide up to 4% interest on customers’ uninvested money deposited in their accounts. This was based on client concerns about the impact of inflation on their investments.
By actively listening to customer feedback and incorporating it into product development, entrepreneurs can ensure their products remain competitive and meet customer needs.
2. Use communities for direct communication
An obvious question for business owners is how to gather customer feedback and focus on what matters. Social media platforms like Reddit, Twitter, and LinkedIn can be great places to start. For example, Twitter Spaces is a feature that allows users to create a chat room-like environment with a group of people.
This serves as a great way to get feedback from users. Entrepreneurs from Elon Musk to Neil Patel have used such communities to get feedback from their customers. However, entrepreneurs can go further by establishing their own dedicated communities.
One strategy is to build a Discord server, a chat application perfect for connecting with customers and building a community. This works especially well for games and software products because the format makes it easy for customers to provide feedback. This was the approach taken by Utkarsh Sinha and Siddharth Jain, the co-founders of Martian, a Web3 company that recently raised $3 million. Sinha notes that their Discord server has over 150,000 members who provide valuable feedback.
Another strategy is hosting online events, such as webinars. This allows business owners to get real-time feedback from customers and showcase their products and services. A challenge with this approach is the relatively smaller size of the potential audience, but it can be a great way to build a loyal customer base. Even if the turnout isn’t huge, the feedback received can be invaluable.
3. Dispatch products quickly based on feedback
Another important way to use customer feedback is to ship products quickly. By acting quickly, business owners can get feedback from customers about their products and make necessary changes or improvements.
If your company takes note of that valuable customer feedback but doesn’t act on it quickly, you could be missing out on a big opportunity. This was emphasized by Siddharth Jain. Jain said working closely with a technical team was a great benefit to the company as it allowed them to quickly ship products and features when customer feedback was received.
In other words, while your sales and marketing or customer support teams may be in closer contact with customers and their feedback, the engineering team needs to be able to act on that feedback to drive real change.
Related: How to really hear and use customer feedback
4. Use customer feedback to pivot
Customer feedback can also be used to pivot. Pivoting is a term used to describe the process of changing the direction of a company. It’s a strategy some entrepreneurs use when their original product or service doesn’t have the desired success.
For example, when the team behind the video game Fortnite found they weren’t getting the traction they wanted, they used customer feedback to pivot. They created a version of the game that was free to play, and the rest is history. Today, Fortnite is one of the most popular video games of all time.
The lesson here is that customer feedback can be used to run a business, and it’s important for entrepreneurs to be open to using it. However, that doesn’t mean blindly following customer feedback; it is still important to use your own judgment and expertise to make the best decisions for your business.
Customer feedback should be an essential part of any company’s innovation process. By understanding customer feedback and using it for product development, leveraging communities for instant communication, shipping products quickly and switching when necessary, entrepreneurs can create products that customers really want and need. This can lead to more success for the company in the long run.
Related: Growth Hacking with Customer Feedback
