Let’s start from the beginning: a customer centric approach is a beautiful thing.
It is, essentially, the concept that the customer is your most important stakeholder. It has been around just long enough to hit that sweet spot in the upward line of the Rogers’ Innovation-Adoption curve where terms reproduce into many variations. It’s also known as customer centric marketing, strategy, culture, or -my personal favourite for when you’re tight on word count- customer centricity. They all mean the same thing because they praise the same player: the customer.
Why it’s important to talk about a Customer Centric approach in business today
At the time of reading this article and in the context of our blog, ie from a company that provides support to lifestyle bloggers, holding customers in high regard probably seems like a fairly obvious concept to you. “Basic” you’d say, if you fall within our largest audience demographic. Because as a member of what older-standing media likes to refer to as “digital natives” (anyone else feel like you’re unworthy of your millennial badge anytime you have a sudden fight with the office printer?), you are a moving part of the current consumer culture. The one that’s shifting because as a generation we’d rather invest in recommendations from trusted sources than mass advertised; make our voices heard in social media instead of being silenced by a sales support rep; launch an indie lip balm and its message to stardom while we walk away from stale, perfecting products. That consumer culture we’re involved in, partially created by us, means that as individuals a customer centric approach comes naturally to us. But it doesn’t necessarily come naturally to all businesses born today, and most definitely not to all businesses started at an earlier time.
Take Marketing, for instance, as a relatively new field within the old-as-time creation and running of businesses. The 4P’s of the original Marketing Mix, which date back to the 60’s, go as follows: Product, Price, Place, Promotion. Cue: customers are nowhere to be seen. Fret not! In the 80’s, marketing theory advanced in line with the blooming industries and an extended Service Marketing Mix was adopted: Product, Price, Promotion, Place, Packaging, Positioning and People. Ouch, still no customers! While arguably the last P for People could refer to Customers, the truth is that in its inception it acknowledged the human element involved in Marketing activities. My goal here is far from discouraging you from the marketing and business world and their evolving trends. In fact, it’s to give you enough context to drive my point home: a customer centric approach is a beautiful thing. It’s revolutionary in its now-assumed simplicity. And it’s also new, very new, which is why its important to talk about its limitations.
Defining the customer centric approach
Time to have a look at how exactly the business world defines customer centricity before we examine the risk of applying this concept too literally. Below are four commonly accepted and followed definitions from the term, all from unrelated sources to one another:
Business Dictionary gives a clear and concise definition:
Creating a positive consumer experience at the point of sale and post-sale.
A customer-centric approach can add value to a company by enabling it to differentiate itself from competitors who do not offer the same experience.
Investopedia agrees on the importance of customer experience, but expands a bit more on its definition:
Client centric is an approach to doing business that focuses on creating a positive experience for the customer. Client centric businesses ensure that the customer is at the center of a business’s philosophy, operations or ideas. Client centric businesses believe that their clients are the only reason that they exist and use every means at their disposal to keep the client happy and satisfied. Client centric is also referred to as customer centric.
Don Peppers -if not the father of customer centric marketing, at least its most visible figure- adds a great comparison between product vs customer centric businesses which points a bit more towards the operational and financial structure of a business:
A product-centric competitor focuses on one product at a time and tries to sell that product to as many customers as possible.
A customer-centric competitor focuses on one customer at a time and tries to sell that customer as many products as possible.
The American Marketing Association timidly begins to highlight the risk of a customer happiness focus
[…] Making people happy is only one part of the equation.The seven pillars of customer centricity help provide marketers with the insight to measure and assess their customer loyalty programs.
The pillars include experience, loyalty, communications, assortment, promotions, price and feedback.
Identifying limitations to customer centricity
Customer centricity as it is works very well for businesses who aim to please their customers, especially when they are after keeping customers happy as long or as frequently as possible. It forces a company to take a hard look at their processes, service experience, people, marketing and even product, and to measure them all against the standards of the ultimate judge – the customer. This approach can be extremely helpful for identifying KPI’s where one might otherwise be lost; customer happiness, ratings and following, NPS, churn.
But don’t all business aim to please their clients as much as possible? Who doesn’t this approach work for?
Innovators, trendsetters, front runners, trailblazers – whichever name you recognise them by, I’m sure you can think of at least one leader you look up to in business decision making. I’m also quite confident that you wouldn’t describe she or he as complacent, because most leaders are also disruptors. And complacency is exactly what can happen if you take a literal approach to customer centric strategies. Turning customer experience into the drive behind your business can sneak a comfortable sense of content into the core of your company culture – which will inevitably fool you into thinking you’re moving forward!
Customer happiness is a two-edged sword, and chasing it is dangerous. When clients are not happy (read: not happy enough; not happy in enough volumes; not happy frequently enough), businesses can fall on the trap of making it their priority goal, if not the sole one. An inability to achieve this goal results in frustration; achieving it, in complacency and comfort. Needless to say, neither is a good look for your business, nor a sustainable motto to keep yourself and your team going.
Taking a customer centric intention beyond a customer centric approach
Here’s where your vision as a business owner comes into play. Nobody can foresee the future you picture and strive to for your company like you can (if they could, it’d be that someone’s business!). Your current customer base -let’s look at it as an autonomous body, made of your largest segment or average- knows what they want today. They know because they’re drawing from their experience on what they wanted yesterday, and how that brought them here. However, your customers cannot possibly know what they will want tomorrow. In fact, even in the incredibly rare (but statistically possible!) optimistic case that your whole customer base agreed on what change they’d like to see next, it still wouldn’t be good news for your business. By the time your customers have the need for a change, chances are your lead time isn’t enough to deliver it correctly.
Steve Jobs’ visionary launch of the iPod, which completely defied any and all consumer trends at its time of launch, has now reached borderline-myth status, as long term favourited tech anecdote everywhere. So admittedly it would be lazy of me to use it as a sweeping statement to get you critically thinking about customer centricity. Instead I have a much more tangible quote to offer your, taken from Amazon’s CEO Jeff Bezos’ 2016 Letter to Stakeholders:
There are many advantages to a customer-centric approach, but here’s the big one: customers are always beautifully, wonderfully dissatisfied, even when they report being happy and business is great. Even when they don’t yet know it, customers want something better, and your desire to delight customers will drive you to invent on their behalf. No customer ever asked Amazon to create the Prime membership program, but it sure turns out they wanted it, and I could give you many such examples.
It seems the key to successfully applying a customer centricity to your business is to think of it as an intention, not a goal. Let it be the motivator, not trigger, behind your decision-making. In order to move your business focus beyond customer happiness and into next-level forward thinking, my proposal is
Allow yourself to take a literal approach to customer centric approach in your business
– so long as you’re referring to your customer in five years from now.