Companies in all industries are ditching traditional business-driven and product-driven strategies as they're starting to embrace the idea of customer centricity. Although being company-driven, product-driven or sales-driven is natural, no longer can brands afford to think only about what’s good for the company without considering the impact on the customer.
Customer centricity is often seen as a catch-all for ideas like customer satisfaction, customer experience
So, what’s it all about?
Above all, customer centricity means putting the customer at the core of your business.
Decades ago, customers had fewer choices. This meant brands could get away with offering mediocre service and customer experience. But now, the customer is in the driver’s seat. We are in the midst of a revolution – in the age of the empowered customer.
Whether you’re in retail, tech, media and entertainment, finance, health care or literally any other industry, customer centricity must be at the center of your business strategy if you’re going to drive profit and gain a competitive edge. Stay ahead in your industry with this definitive guide for a customer-centric model.
Whether big or small, every decision you make about your business needs to be fueled by customer feedback. Are you erroneously assuming what your customers want? Are you considering them during the decision-making process at all? Or are your decisions based on profits or shareholder demands?
If you’re developing products you think your customers want without testing the concepts with real-life customers, you risk failing when introducing them into the market. The price point might be wrong. The features may not be what your customers need. The product may not solve the customer’s pain or problem. Marketing campaigns based on gut feelings rather than customer intelligence will also likely fall flat and fail to resonate with your audience.
The same is true with every other decision you make.
If the customer isn’t your most important stakeholder, at the center of all decisions you make, you’re not customer-centric.
You’ve increased the budget in the customer service department. That makes you customer-centric, right?
To truly be customer-centric, every employee in your organization must understand who your customers are and what they want – not just your customer service representatives. This includes your engineering team, your product development team, marketing, sales and service, all the way to the organization’s key decision makers. The entire organization must be aligned around the customer.
“The customer’s perception is your reality.”
– Kate Zabriskie, President, Business Training Works Inc.
Maybe your marketers know that your customers are between 20 and 25 years old. Maybe your product development team understands that your customers are in a higher income bracket. This is a good start, but it doesn’t make you customer-centric. You need “small” data to complement your big data.
You need to go beyond demographics and get to know your customers on a more intimate and granular level. This starts with talking to your customers.
“Spend a lot of time talking to customers face to face. You’d be amazed how many companies don’t listen to their customers.”
– Ross Perot, American Business Magnate
Yes, gaining new customers is important. Absolutely. And to do so, you may use customer intelligence to learn more about the buying journey. You may target your marketing campaigns expertly to your customers’ interests and preferences. Your products may solve a need your customers have. But does it stop there? Once the customer is sold, do you continue to delight them, or do you move on and focus on gaining other new customers?
The most customer-centric brands don’t leave their existing customers high and dry. They continue to engage them because they understand the value of customer loyalty and retention as critical parts of a customer-focused strategy.
“Though many companies claim to be customer-centric, the majority are not.”
These companies may have good intentions and care about their customers but they often operate based on a misunderstanding of what it truly means to be customer-centric. For many, being customer focused and being customer-centric are one and the same. The two terms are often used interchangeably. This is often where companies make a misstep on their journey to becoming customer-centric. Knowing the key differences between the two can help.
Customer-focused companies look at the customer to determine what to sell them. On the other hand, customer-centric companies think like the customer. They try to see the world from their point of view. For example, a customer-focused approach may use A/B testing to see what ads resonate most with customers. A customer-centric approach would seek out their ideal customers, talk to them and co-create ads with them instead.
Customer-centric companies think like the customer.
If you’re customer focused, you’ll listen to what customers want and try to deliver the products they’re interested in. If you’re a customer-centric company, you’ll try to understand what the customer truly needs, focus on solving problems and determine how to deliver the most value.
Using a customer-focused approach, you would try to identify which of your products or services would best match the wants of your customers. On the other hand, using a customer-centric approach, you would instead create a solution to the customer’s needs to deliver a positive long-term experience. Marketing maverick, Seth Godin, said it best, “Don't find customers for your products, find products for your customers.”
We’ve discussed some of the common misconceptions surrounding customer centricity and the common mistakes companies make when trying to become customer-centric. We know it’s not just about keeping customers happy or offering great customer service. Now let’s switch gears and discuss what it really means to be customer-centric.
But remember: you can't achieve customer centricity without understanding your customers’ needs, pain points
Being a sales-centric organization means your company’s main objectives are to meet sales numbers and increase market share. Of course, there isn’t anything wrong with growing your sales and profit.
However, too often, focusing on sales and profit comes at the expense of the customer.
When you’re so focused on the sales process and you don’t give any thought to how your customers feel about your sales and service, your customers feel dissatisfied. At the end of the day, when your culture is based on short-term sales, you lose out on customer satisfaction and long-term customer loyalty. This, in turn, leads to lost opportunities for repeat business and referrals. It can also negatively affect your brand and, ultimately, your profit.
To better understand why being customer-centric is so important in business today, we need to first understand why customer satisfaction and customer loyalty are so important.
As we mentioned before, customers are now in the driver’s seat. Thanks to the I
"If people believe they share values with a company, they will stay loyal to the brand.”
– Howard Schultz, Chairman Emeritus, Starbucks
Ultimately, this will make them more loyal to your brand. This is a big win for your company.
The customer loyalty statistics are pretty clear on the issue:
However, companies today have a growing customer loyalty problem. According to a Vision Critical survey, it takes just two bad experiences to make Americans stop shopping with a brand. Even your highest spending customers aren’t necessarily loyal, either.
"It takes just two bad experiences to make Americans stop shopping with your brand."
"Unless you have 100% customer satisfaction, you must improve." – Horst Schulze, Former President, The Ritz Carlton Hotels
Being customer first is critical to keeping customers engaged, satisfied, and loyal. Research shows a strong emotional connection with a brand is a stronger loyalty driver than factors such as ease and effectiveness. If you want to keep your customers from cheating on you, it’s important to understand the importance of customer centricity before it’s too late.
Although having a sales-centric culture may seem more effective, the customer-centric culture is actually more profitable over the long term because it focuses on providing a positive customer experience, solving problems, delivering high-quality products customers need and creating real relationships.
No doubt, there are some pretty scary risks and disadvantages of not becoming customer-centric, as we’ve highlighted. Focusing your company on the customer will help you stay relevant in the modern age and continue to deliver quality products and services your customers love.
There are other benefits that come with being a customer-centric brand too.
You can’t align your company around the customer if you don’t understand who your customers are and what they need.
But this isn’t easy. Most companies struggle to find a repeatable, scalable way to generate real-time, valuable customer insight. Then they also need to share this information across departments and implement what they’ve learned to transform their business strategy – another challenge in itself.
But as we know, overcoming these challenges is worth the effort, time and resources.
Most companies simply do not have the right components in place to be customer-centric. The ones that have been able to successfully design their company from the customer’s perspective, however, have followed some best practices to get to where they are today.
The empowered customers in today’s modern age care about what you do, not what you say. They want you to walk the walk. You cannot just say your brand is customer-centric. You need to become customer-centric at your core. Adopting the label won’t get you far if you can’t back it up.
To ensure your customer is at the heart of every business decision you make, you need these 4 C’s.
Brian Solis, bestselling author
Being customer-centric isn’t just a marketing exercise. Rather, it needs to be engrained in your corporate culture and reinforced in everything you do.
If you get the culture right, everything else should fall into place.
We don't need to tell you that your customers want to be treated like people, not numbers. But more than that, they want to know there’s a real person on the other end of the phone when they call and a person on the other end of that chat message or that email. And they want to feel as though they are a part of a community.
By creating a community for your customers, you can effectively increase emotional engagement, which will in turn build loyalty.
Never underestimate the power behind the sense of belonging.
There’s a reason one-off surveys don’t work anymore. There’s a reason online insight communities are the most effective way to generate customer feedback today. Customers want two-way dialogue. They want to be listened to. And they want to feel as though they are being heard.
It’s critical that you speak directly to your customers and listen to their needs, questions
Finally, we have consistency. In today’s digital world, customers do the majority of their research online. They compare prices and features. They read reviews. They may buy without even leaving their houses or they may only walk into your brick-and-mortar store after conducting comprehensive online research.
At all these touch points, you need to offer consistency to ensure a seamless omnichannel experience across all interactions, channels
“Offer consistency to ensure a seamless omnichannel experience across all interactions, channels and devices."
The seven pillars of customer centricity can be used as a framework for action. The key is to analyze customers’ perceptions against these seven core areas of your company to ensure your business strategy is truly customer-centric and borne of data-driven customer science.
Tossing around buzzwords about customer centricity won’t lead to true growth. Analyze your effectiveness in these seven core areas to ensure you really understand your customers, their behaviors and their needs, so you can center your business around them.
By better understanding your customer on a granular level, you can ultimately make more intelligent business decisions.
Gathering customer intelligence is only one piece of the puzzle. Intelligence isn’t useful if it isn’t actionable. That’s why market researchers need to be able to turn intelligence into customer insight. This is how you get to the “Why.”
“There is a great difference between knowing and understanding: you can know a lot about something and not really understand it."
- Charles F. Kettering, Former Head of Research, General Motors
Bulky reports and pie charts need to be transformed into actionable recommendations. The data you generate tells a story – you just need to determine what it’s telling you. Only then can you turn intelligence into your competitive advantage. Look beyond data, use customer intelligence and arrive at actionable customer insight that can inform your business decisions.
If you’re throwing traditional market research methods out the window, you need a new way to generate customer intelligence.
You need new tools that will enable you to:
The customer intelligence platform is critical to a successful customer intelligence program. It gives you a way to speak directly to a group of opted-in and carefully profiled customers to get real-time, honest feedback from the people who buy your services or products.
To get the most out of customer intelligence – to ensure it drives great decision making – you need to make sure your customer intelligence program is effective. These three questions can help you determine the value of your current program.
While it’s important to use customer intelligence to improve internal processes, you shouldn’t stop there. Your customer intelligence program will be more powerful when it improves your brand’s relationships with your customers.
Today’s empowered customers expect brands to listen to their opinions, suggestions and complaints. A customer intelligence platform enables you to do just that. But you need to show them that you’re doing more than just listening. Make sure you share exactly how you are including the customer in your business decision making. When you do this, customers will feel as though they really matter to your company, which will increase engagement and loyalty.
The insight you gather is valuable not only to your company and your customers but to your partners as well. And it can offer you a competitive advantage if you monetize your data. Maybe you have advertisers or sponsors who could benefit from your customer insight. Maybe the retailers who stock your product could benefit from the intelligence you’ve generated.
Customer intelligence can provide even more business value when it’s shared with partners or used to secure new partnerships.
Becoming customer-centric makes good business sense. However, customer intelligence is only valuable when it’s turned into customer insight that drives decision making to enhance the customer experience, customer journey, sales, service and profits.
“The role of the progressive insight professional in a customer-centric strategy cannot be overstated."
For many (if not all) companies, successful innovation and the ability to remain competitive in their industries, hinges on ongoing access to agile customer insight.
The insight professional is more important today than ever before for three key reasons:
A recent survey from Deloitte found that 51 percent of companies consider embedding analytics into their process a challenge. The same study revealed that 56 percent find optimizing insight equally challenging, and tracking and measuring the output of analytics even more so. These findings are alarming given that, according to research from Forrester, the ability to optimize insights, track and measure outputs and embed analytics into the process are critical competencies.
To be truly insight-driven, businesses require a fundamental transformation in the way people at all levels of the business understand, engage and value the relationship they have with their customers.
Leaders not only have to believe customer-validated insight will result in better products and experiences, but they must also be willing to put people, technology and process in place to make that possible.
Technology that enables insights teams to rapidly collect data and share insight across the company in a programmatic and scalable way has been recognized as a true competitive advantage.
Who’s doing it well? Forrester calls them
According to Forrester, insights-driven businesses create differentiating experiences, products
The process starts with an objective assessment of your own business and your competition. Determining where to focus your effort and financial investments are foundational.
This includes, but is not limited to, several
A closer look at insights-driven businesses reveals that these firms capture more and better data about customers – information that blends direct feedback with transactional data and quantitative knowledge stored in organizational silos. With a powerful set of core competencies supported by sophisticated software platforms, insight professionals in these companies can discover, learn and optimize “digital insights” to create a compelling competitive advantage for their organizations.
According to the 2017 GRIT report, the biggest near-term opportunity for the research industry is technology. By technology, they’re talking about software, applications
“The biggest near-term opportunity for the research industry is technology.”
– GRIT report
Traditionally, gathering customer feedback is seen as poor customer experience. It’s typically disjointed and disconnected from the customer experience. Your customers simply do not want to fill out a random, disruptive survey.
In a customer-centric economy, market researchers should consider research as a branded experience, a customer touch point. Make the process of gathering feedback enjoyable, fun and seamless for the customer.
Big data may still have the potential to drive a significant competitive advantage, but the immediate opportunity for today’s progressive insights professional is to adopt technology that uncovers agile,
The immediate opportunity for today’s progressive insights professional is to adopt technology that uncovers agile, ongoing insight that matches the cadence of the business.
The ability to uncover the “Why” behind customer behavior in a structured, scalable and repeatable way means using new technology to uncover small data. This data is not only relevant to the immediate needs of the stakeholder, but it can be used to help shape and test the hypotheses of data science teams.
One day, machine learning and neural networks may provide new insight into human behavior. But today, the simplest, most direct and vastly more economical route to deeper customer understanding is to simply ask people “why?”
The pressures of time and ever-changing customer expectations have also served to diminish the real-time utility of big data. Honestly, companies have hit a data value plateau where it is exponentially more difficult and expensive to
Here are the facts:
Not surprisingly, the traditional methods of uncovering small data aren’t great. In fact, they’re fraught with difficulties.
Consider these examples:
While there is no magic bullet, the most immediate and impactful opportunity for leaders looking for a way to uncover agile insight is to provide their teams with technology that provides on-demand access to a group of highly engaged, opted-in customers – known customers – who can be engaged at scale.
The shift to becoming a truly customer-centric organization is long and complex. It requires a passion for the customer and a commitment to change. But as we’ve shown, the benefits are worth the effort.
Even more importantly, in the age of the empowered customer, you may not have a choice but to become customer-centric. By putting yourself in the shoes of your customer, building a customer-centric culture and generating the customer insight required to make customer first business decisions, you too can gain the significant benefits of becoming customer-centric.