- Strategy
- Technology
- Customer-centric KPIs
Usually, Product-Centric companies have their competitive advantage stored in product expertise. Remember this. It shouldn’t be surprising – in fact, the more we become ‘experts’ of technology, the more we irrationally feel that we don’t need to listen to customers.
Generally, Customer-Centric companies try to align development and delivery around the current and future needs of a set of customers. This sentence is very important, as it introduces three new concepts that are not present in a strict Product-Centric culture:
- Future
- Segmentation
- Personalization
In fact, Customer-Centric companies try to maximize shareholders’ value by distinguishing highly profitable clients from less profitable ones, introducing the concept of lifetime financial value. Hence, Customer-Centric brands do not only care about today’s revenue but invest to cultivate clients that may spend more in the future. As a consequence, Customer-Centric firms’ competitive advantage is in the relationship experts, and no longer in the product.
Sounds good, but how do Customer-Centrics execute their plan? Mostly by focusing on these three tactics:
- Customer development: make existing clients more valuable
- Customer retention: cultivate clients so they don’t leave for another brand
- Customer acquisition: focus on behaviours, not on demographics
So why is it so important that executives know and understand the product and consumer-centric concepts? Because moving from Product-Centric to Customer-Centric requires a cultural change from the above. Changes may impact design, structure, processes, metrics, and even incentives. The focus needs to move from ‘sell now’ to bigger, and more long-term goals.
What if you realise that your company is a Product-Centric company? First of all there is no good or bad here. There are many successful product-centric companies out there, but it is also true that in highly competitive markets most brands are now becoming Customer-Centric.
What if you aren’t an executive? Well, you can start your Customer-Centric transformation without having the support of the top management (yet). Try to experiment with this routine:
- Ask your clients/contacts/colleagues for feedback after an important interaction
- Write it down, segmenting by different customer persona
- Collect them during the week, and ask at least another colleague to do so
- Organize a 20-minute meeting with your team to share the feedback, discuss learning, and think about improvements
- Implement the changes into your day-to-day while you keep track of new feedback
- If results are encouraging, share them with the management
- Advertise the changes to your customers, as they would be delighted that you heard their voice.
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