What is Customer Sentiment Analysis? 4 Reasons Why You Should Care
Understanding your customers — their pain points, their needs, and their purchasing motivations — is critical to your success when you run an eCommerce business. But often, "understanding your customers" is easier said than done. Looking at customer feedback may be the only time you're able to directly engage with the opinions of your customers, and this is just one of many balls you're expected to keep in the air as an eCommerce entrepreneur.
Customer sentiment analysis makes it easier, by using smart automation to provide insights about customers' interactions with your brand and your products and packaging the information in ways that make it easy to understand and use to improve your business.
Here's what it means, how it works, and why you should care about it.
What Is Customer Sentiment Analysis?
If you were asked what is the quickest way to find out how your customers feel about your products, how would you respond? If your instinct is to point to your overall star rating, you're not alone.
But the emotional responses your customers have to your products are more nuanced than just "good" or "bad". Star rating is a quantitative metric. It tells you which products are your most popular and provides a snapshot of your customers' thoughts about your brand — but it doesn't tell the whole story.
In their feedback, your customers are also sharing qualitative information, specific value judgments concerning which aspects of your business they like, which they don't like, and why (or why not). That's what we refer to when we use the term, "customer sentiment".
Therefore, customer sentiment analysis is the gathering of customer sentiment information in order to better understand large sections of your customer database.
How Is Customer Sentiment Analysis Performed?
If you have a lot of reviews, it may seem daunting to undertake the process of analyzing them and recording key details hidden with the feedback your customers leave on your website and around the internet. That's why this process is performed using technology — artificial intelligence (AI) taught to recognize keywords and judge which parts of a given review are positive and which are negative.
Here's an example. Let's say you have one review, created by a recent first-time customer. They rate the product they purchased a modest three stars out of five, and leave feedback that reads as follows:
"I was happy with the quality, but the time it took to be delivered left a little to be desired."
Without customer sentiment analysis active, this would register as a three-star review and little (if any) other insight would be derived from it without you personally reading the review and making a note of the feedback.
With customer sentiment analysis, however, the AI would be able to understand that the customer left their opinion on two aspects of your business: product quality and delivery speed.
It would register a positive response to the first aspect, since the customer reported that they were happy with the actual product, but a negative reaction to the delivery speed. These would then be communicated to you in a report that allows you to sort and segment customer sentiment information, enabling you to quickly see which areas of your business you need to improve to meet the standards of your customers.
4 Reasons Why You Should Care About Customer Sentiment Analysis
Here are four reasons why even if you weren't aware of the existence of customer sentiment analysis before right now, you can't go on ignoring it any longer:
1. It's Becoming More Common
Technology is getting smarter every day, putting some of the most complex algorithms into the hands of business owners like you. But if you have access to these types of insights, so do your competitors. If you're not making the effort to understand the way your customers feel, you're risking losing those customers to competing brands that are.
2. It Gives You More Insights in Less Time
While review management is important to your ability to continue driving new business, the usable data you'll be able to get as you get more and more reviews will diminish to the point where it will be next to impossible to learn anything from the feedback your customers leave.
With customer sentiment analysis active, you'll be able to learn more from a system that automatically aggregates feedback on various aspects of your business, almost instantly giving you updates on what's going well and what needs improvement.
3. It Helps You Plan for the Future
When it's time to improve your operations, you'll know where to target your next investment. Let's say that in the hypothetical scenario above, the customer that left negative feedback about your business's delivery times was one of many that echoed that sentiment. When it's time to plan for the next quarter, this might prompt you to invest in your supply chain, cutting down delivery times.
4. It's Your Key to Happier, More Loyal Customers
Using customer sentiment analysis means the changes you make are targeted to the areas where your customers feel they're needed most. Those customers will notice that you've changed your business based on their feedback, and the removal of friction in the sales process will make it easier for them to purchase again in the future. Essentially, making them feel heard means higher customer satisfaction, deeper brand loyalty, and maximized customer retention for your eCommerce store.
Introducing StampedIQ Customer Sentiment Analysis
Stamped.io has helped countless eCommerce business owners work smarter (not harder) with an array of sensible solutions for everyday challenges. Now we're proud introduce our smartest tool yet — StampedIQ.
StampedIQ takes the core functions of a standard customer sentiment analysis and innovates on them even further. Not only does it analyze customer feedback and document sentiments on a range of different factors, but it also uses this data to prompt future customers to leave more valuable reviews. At the same time, it generates easy-to-understand score breakdowns on the most important aspects of your business so you can isolate areas of strength and improvement at glance.
StampedIQ represents an evolution of technology that you can use to understand the way your customers feel better and easier than ever before.