Love might be in the air this Valentine’s, but there’s one relationship you should never take for granted: the customer-brand relationship. It’s 2023, so transactional relationships aren’t a thing anymore. If you aim for long-term growth and an established market presence, you must invest in your customers and deepen your relationships. The first step is understanding what customers think about your products and services. In today’s post, we’ll look at a crucial process for any business looking to succeed in today’s fast-paced world: customer sentiment analysis.
From understanding customer opinions to improving customer experience, we’re going to cover it all.
Let’s ride!
What Is a Customer Sentiment?
Customer sentiment is a qualitative customer experience metric showing how customers feel about their interactions with your brand.
Customer sentiment isn’t quantitative – it can’t be quantified. Instead, the customer sentiment metric can be neutral, positive, or negative.
Unlike a straightforward, figured-based KPI (such as the net promoter score), your customer sentiment data helps you understand what customers love (or hate) about connecting with your business.
Analytical minds tend to disregard customer sentiment, as it’s more challenging to capture. However, conducting sentiment analysis allows you to listen to the customer’s voice and get crucial insights that otherwise might have slipped through the numbers.
The primary purpose of customer sentiment analysis is to give customers the means to explicitly inform you about the processes your brand does right (or wrong) and how to improve your customer relationships.
At the same time, failing to measure customer sentiment can lead to missed opportunities and an overall decline in customer satisfaction and loyalty over time.
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Why Is Customer Sentiment Important?
As any professional in retail, eComm, or even SaaS, your number one job is making consumers scream “Hell, yeah!” and buy the products without a second thought.
While your marketing campaigns might entice consumers to do the actions you’re looking for, you also need to elicit a positive customer response and make your relationship as enjoyable as possible.
Consumers must feel your price is fair for the value you’re offering, the shopping experience is convenient, the products are high quality, and their lives are better with your help.
Tracking customer sentiment informs you about improved customer experience, increased customer loyalty, and business growth.
There are numerous benefits to caring about customer sentiment. Here’s a selection of the most common way you can improve both customer relationships and the efficiency of your business processes:
More positive customer experiences.
We challenge you to ask any eComm expert worth his salt what the most crucial thing you can do to expand your company is.
Our bet is that 9 out of 10 people will tell you about giving the customers what they need. If that’s an endeavor you’re willing to take on, customer sentiment is how you get your action plan.
Being aware of customer sentiment allows you to identify areas for improvement in your products and services.
Acting on that feedback and becoming better brand results in a more positive customer experience and increased customer satisfaction while lowering the risk of customer churn.
It’s that simple.
Customer Loyalty will skyrocket.
Unless suffering from Stockholm Syndrome, consumers won’t stick around brands that make them angry, frustrated or used.
On the other hand, happy customers are more likely to become loyal customers. Why would they leave something good? Why would they leave a brand that continuously improves the customer experience?
You won’t know which side you’re on unless you measure sentiments
, understand what drives customer loyalty, and provide that certain something to your customers.
Better, more competitive products.
While some may say you shouldn’t fix what isn’t broken, we strongly advise improving your products according to customers’ sentiments.
When you analyze customers’ product experience, you get a crystal-clear picture of what customers want and need from your products.
Sometimes negative customer sentiment appears when you over-promise in the marketing stage, and customers feel as if you’ve lied to them.
Other times, you realize your products offer tremendous value, and you have to raise your prices.
Whichever the case, tracking customer sentiment concerning your products will inform more accurate product development decisions.
Spot issues before it’s too late.
Nobody’s perfect, and that includes your business. Sometimes a minor issue can appear inside your procedures and become a massive problem if left untreated.
Just as an untreated cavity will become an infection and weaken the entire immune system, a hidden problem might ripple into a domino effect and harm the whole customers’ journeys.
Your customer sentiment data allows you to identify potential issues early on before they become significant problems. This means you can take proactive steps to address those issues and avoid possible damage to your reputation.
More in-depth customer insights.
A common problem with eComm & Retail is that they have too much customer data and insufficient insights.
Data can feel like a burden if we don’t know how to turn it into insights and actionable pathways.
However, when you measure customer sentiment, you uncover a rich source of customer insights you act on, a strategic roadmap if you will.
Customer insights ultimately lead to better decision-making and keep you from over-relying on shiny new software you might not even need.
It’s simple to become excited while using cutting-edge technology, believing it will address every problem. However, informing your decisions on customer data is by far a better approach to eComm & Retail.
Positive brand recognition.
Reaching your brand’s target audience becomes easier when you make a name for yourself. However, brand awareness isn’t everything; there’s a thin line between being famous and infamous.
In other words, you want people to associate your brand with professionalism, fairness, and quality.
Monitoring customer sentiment provides valuable information about how customers perceive your brand. You can see how good a reputation you’ve built and can inform your branding and reputation management efforts.
The bottom line? It would be a pity if you missed out on the valuable insights that appear when you’re measuring customer sentiment. There are too many positives and (close to) zero negatives of customer sentiment tracking – invest in understanding your customers today.
How to Measure Customer Sentiment
Now that we’ve convinced you customer sentiment shouldn’t miss from your metric list, it’s time we moved on to tactics you can use to collect customer sentiment and use it to improve customer satisfaction.
- Reviews and Interviews
The simplest, most “in your face” way to gauge customer sentiment is simply asking customers for their direct feedback.
- Qualitative Customer Surveys
While customer sentiment can’t be quantified in a number or a one-star review, you can still send out a customer survey to collect it.
The trick is adding additional open-ended questions to the quantitative ones and allowing customers to express their thoughts without interrupting.
For example, suppose you’re sending out a post-purchase net promoter score survey. In this case, besides the standard rating question, you will follow up with an open-ended one, asking customers to explain their answers.
You can then use an analysis tool to study customers’ answers, search for patterns, and organize responses by neutral, positive, or negative variables.
- Social Monitoring
This is the process of tracking and responding to online brand mentions – be they on social media, blogs, review sites, or any other channel.
With social monitoring, you can understand customer sentiment from a candid POV – as consumers tend to express their most honest feelings on social media or review blogs.
In short, anyone who ever had an opinion regarding interacting with your brand can complain about (or praise) the interaction online. You can identify praise or complaints patterns and understand what makes your customers happy and what upsets them.
You can also track the level of customer engagement with your brand. Are people interacting with your social media posts? Or are your business profiles resembling the wild wild west with its tumbleweeds?
Lack of engagement signals neutral sentiment towards your brand. Negative interactions reveal a negative emotion, while positive reviews and experiences prove you’re doing a great job.
What Is Customer Sentiment Analysis?
Customer Sentiment Analysis is a market research process through which you use a sentiment analysis tool to learn how customers feel about your brand.
You can perform the analysis to see what consumers think of the overall brand experience or target the analysis to understand customers’ feelings vis-a-vis a specific process (such as product launches, a change in prices, a new loyalty program, etc.)
Depending on your purpose, there are three methods to conduct customer sentiment analysis:
Type 1 – Binary Sentiment Analysis
This type of analysis clusters the sentiment (words used by customers) into two categories: positive or negative.
While it’s the most straightforward method, it cannot spot nuances in customers’ sentiments.
Type 2 – Multi-Class Sentiment Analysis
In a more nuanced method, you can group customers’ feedback into three (or more) categories with the multi-class analysis.
Typically, multi-class analysis segments responses into positive, negative, and neutral sentiments, providing a more advanced method of understanding customers’ feelings.
Type 3 – Fine-Grained Sentiment Analysis
This is the most advanced and nuanced analysis method, identifying specific customer emotions such as anger, happiness, sadness, fear, etc.
The fine-grained analysis provides a deeper understanding of the sentiment and can pinpoint your customer base’s exact level of emotion.
All types of sentiment analysis are crucial because they can show you where you need to make improvements and where you can keep up with your business practices without any change.
Whichever method you choose, the process for customer sentiment analysis follows the same pattern:
Step 1 – You collect the data.
Firstly, use a customer sentiment analysis tool to gather the data you will analyze.
You can monitor social media to cluster the social media sentiments, collect and sort customer surveys, send out feedback forms, scour online forums, or import customer reviews.
The idea is simple: wherever there’s a medium for opinion stating, you must be there to see what customers are saying about your brand. All your brand mentions should be imported into a CRM that gathers all data into a single view.
Step 2 – You pre-process the text (comments).
After you import all customer comments (from all your sources), you need to clean the comments. This includes converting all letters to lowercase and removing stop words & punctuation marks.
Step 3 – You score the sentiments.
Using an algorithm, your data is distributed and assigned a score – it can be a numerical value or a label (positive, neutral, negative).
Step 4 – You analyze and visualize the scores.
Your CRM tool must now display your data in a graph visualization design, so you’ll get a crystal clear view of the overall sentiment towards your brand.
Step 5 -You get your insights and inform your decisions.
Moving on to improving customer sentiment, it’s time for the decision-making step.
You went through this process to understand how your customers feel, and now it’s the time to act on these feelings.
For example, if a specific category has many negative reviews, you should consider revising your purchasing strategy and eliminating the brand from your product suite.
Additionally, you can perform further qualitative research (e.g., interview unhappy customers) and understand the reasons behind the scores.
Following up on the category example, you should see why it upsets your customers. Is it the product quality, shipping problems, or failure to deliver on the promise?
Understanding the “why” behind the sentiment empowers you to take the necessary steps to remedy the problem and ensure it doesn’t further affect customer satisfaction.
Benefits of Customer Sentiment Analysis
In addition to all the benefits of tracking the customer sentiment metric, more arguments come into the bargain when you analyze customer sentiment.
- Improved Crisis Management
Following the “better safe than sorry” principle, you can closely monitor customers’ reactions to a crisis with sentiment analysis. Use sentiment analysis to mitigate the repercussions and smooth the situation, whether it’s an inventory problem, a shipping issue, or a privacy breach.
- More effective marketing.
Monitor customers’ feelings and reactions toward your marketing campaigns and identify the messages your customers most resonate with.
Having this insight can help you adjust your marketing strategies to meet the expectations of your target audience.
- A clearer understanding of customer needs.
When you understand the needs and expectations of your customers, you can develop products and services that better meet those needs.
A clear example of such a service in eCommerce is the easy box method of shipping in eCommerce. Customers were getting frustrated with couriers and missed deliveries, so eComm companies created the self-pick-up option, providing customers with a more convenient way of getting their orders.
With a simple change in the delivery method, customer experience management teams eliminated frustrations and ensured customer retention wouldn’t be affected by negative sentiments.
- Better Social Media Presence
In the age of instant communication, you must address customer feedback in real-time (if possible).
Sentiment analysis helps you act quickly when customers express negative sentiments on Social Media and improve your social media presence.
- You earn a competitive advantage.
74% of consumers admitted they’re only loyal to brands who understand and value them; discounts and perks don’t weigh as much anymore (2022 Redpoint Global survey).
Moreover, 34% of consumers said they’re willing to pay more for a product if the brand knows them individually and doesn’t treat customers as cash flows.
If you act on sentiment analysis, you’re getting to know and understand your customers and can provide excellent customer experiences.
This positions your brand as a superior brand in your industry and provides an advantage over your competitors.
While customer sentiment analysis involves some leg work, its many benefits are worth your time. With sentiment analysis, you can respond proactively to negative feedback, reduce the impact of potential crises and improve your online reputation.
Wrap Up
So, what have we learned today? First of all, caring is cool again.
With its ability to provide valuable insights into customer opinions and help you improve products and services, there’s no doubt that sentiment analysis is an essential tool for your success in today’s fast-paced business world.
So go forth and analyze those sentiments!
Frequently Asked Questions about Customer Sentiment
How do you measure customer sentiments?
There are several options to measure customer sentiment, including post-purchase surveys, social media monitoring, text analysis of customer feedback, or even interviewing customers.
What is a sentiment example?
A sentiment example would be a customer saying “I had a fantastic experience shopping at your store today.” In this case, the customer expresses a positive sentiment, signalling he enjoyed the experience.
What are the types of customer sentiment?
There are three types of customer sentiment: positive, negative, and neutral.
What is customer sentiment analytics?
Customer sentiment analytics is the process of analyzing customer opinions and emotions towards a company or product through various data sources.
What is sentiment for customer experience?
Sentiment for customer experience refers to the emotional response of a customer towards their interaction with a company, product or service.
