Feedback in games is not only the return that you have by the players, it’s also a way to respond their commands during the gameplay. It is even possible to say that it is the most important aspect of the development process. It is essential that it is well planed and that the reaction be the best possible.
We will start with the most common definition about feedback: response of the players. This includes the first testers, to the final ones. Their response must always be a reference to the development of your project. If it is during development, it is the best time to refine something that was poorly planned, or even surprise yourself with something new that wasn’t planned and works better than what you originally had. Or even after the release, in which case the feedback may be used in potential patches (updates with bug fixes), DLCs (downloadable content), or for your future titles.
But the feedback is also a game mechanic, like I said in the first paragraph. Each command the player executes must receive a response from the game in a positive way. That’s why the statement about testers was made previously. However, this is different from genre to genre. Puzzle games need to offer satisfaction upon solving each one, while MMOs may have much more complexity by balancing it all.
In both cases, self-criticism of the developer is essential. Never believe that your product is perfect and has no room for improvement. Always listen to the community playing your game(s). This doesn’t mean you have to implement or remove everything they say, but you should at least take it into consideration and think about it. What they’re doing is reacting, and giving feedback; something everyone needs in the course of development.
This is one reason why mods are so popular. You’re giving the community an opportunity to participate in your project, and put their ideas into practice based off of the base game. Pleasing the community should always be a high priority as a developer. Kickstarter is successful in this way.
Similarly, the current criticism towards the ending of Mass Effect 3 is a good example. For the first time, people were able to show feedback via donation to Children’s Play. However, some responses could be more aggressive than others. You just need to understand how to handle things things properly.