Customer Centric is a strategy that aims to make the customer the center of a company's strategic planning , increasing their lifetime and reducing cancellations and potential dissatisfaction to achieve the organization's business objectives.
According to research, customer-centric companies are 60% more profitable than companies that don't focus on customers. (Super Office)
How about better understanding what this strategy is and what you need to do to implement it within your company? Keep reading this post!
What is Customer Centric?
The Customer Centric strategy, or Customer at the Center, as the name itself emphasizes, is when the company places the customer at the center of the strategy to achieve its business objectives .
Customer Centric companies focus their strategic planning on the customer experience , thus increasing loyalty rates and achieving better results.
What are the main challenges companies face in putting the customer at the center of their strategies?
Becoming a customer-centric company is no easy task. The main challenge lies in understanding —or, at best, anticipating —consumer desires and demands.
To achieve this, all company teams must work together toward a common goal: customer focus. This can only be achieved by implementing a customer-centric culture within the organization.
In other words, it is not enough to offer the highest quality product or service at the best price if the service, for example, leaves your customer dissatisfied .
Another very challenging point for companies that want to be customer-centric has to do with strategic planning and the discrepancies that can arise between the organization's financial objectives and the customer experience.
In other words, what should you do: abandon a more advantageous strategy for the company in exchange for a plan that prioritizes the customer, or vice versa?
In any case, know that customer centricity is a long-term strategy , with clearer results appearing after a long period of loyalty and strengthening of the relationship with the customer.
Benefits and advantages of putting the customer at the center
If you thought that the main objective of applying Customer Centric techniques is to increase customer loyalty, you thought right!
A Customer Centric company can increase customer lifetime value and reduce cancellations and potential dissatisfaction.
According to a survey by Bain & Co :
- Companies that excel at customer experience increase revenue 4-8% above their competitors;
- Superior experiences deliver 6 to 14 times greater customer lifetime value;
- Voice of the customer programs result in up to 55% higher customer retention.
How to apply customer centricity and become a Customer-Centric company?
As explained so far, a company considered Customer-Centric has as its main characteristic the centralization of all its strategic planning on the customer. Everything that is done within that organization aims to provide a satisfactory experience for its customer throughout their journey with the brand .
Establish a top-down culture and develop customer-focused leadership
To develop a culture focused on customer experience, start by fostering this mindset among the organization's leaders. This will help establish a healthy and productive culture at all levels of the company's hierarchy.
Listen to your customer so you understand their desires and expectations.
It's essential to have a thorough understanding of your customer's desires, challenges, goals, and general behavior to provide them with the best possible experience throughout their entire journey with your brand.
CRM (Customer Relationship Management) tools NPS, CES, or CSAT surveys . You can also manage your customer reviews. Learn more about Harmo .
Invest in the relationship
Customer relationships are one of the most important things your company can cultivate. It's an investment that often yields many rewards, even more than expected. For example, when a company has a good relationship with its target audience, they, in turn, may recommend it to friends and acquaintances, engaging in the famous "word-of-mouth" marketing .
Train your employees well to give them autonomy
With autonomy, your employees feel more confident making decisions that benefit the customer experience. They use creativity and different resources to make processes more efficient and faster.
Before you can begin improving the customer experience, you must first understand what is causing negative or high-effort customer experiences.
The Customer Effort Score is a survey metric used to measure the level of effort a customer put into resolving a specific issue with your company.
Use customer feedback to improve
Actively utilize feedback from your customers; from there, you can constantly improve your service.
The Feedback Economy presents a vital opportunity for businesses to succeed or fail. With consumers interacting with each other to decide how they feel about a brand, feedback holds immense power when it comes to choosing where consumers will spend their money.
Using customer feedback is no longer an option. It's a must for any company that wants to stay alive and thrive. Check out our webinar: What is the Feedback Economy and Why Should Your Company Care?
How to measure customer-centric strategy?
Churn Rate
Churn is a metric that represents the rate at which customers abandon or cancel products, services, or contracts. For successful business growth, the number of new customers must always exceed the number of customers who stop using the product or service .
Lifetime Value (LTV)
Lifetime value is the value of a customer's life cycle, that is, how much a customer spends with your brand throughout their relationship with it. More than just understanding how much revenue your customer generates and how much they invest, it's also important to identify opportunities to strengthen the relationship between them and your company and encourage them to invest even more in your product or service.
Net Promoter Score (NPS)
NPS , or Net Promoter Score , is a metric developed to measure customer loyalty. Generally speaking, the metric assesses the extent to which customers recommend a particular company, product, or service to friends, family, or colleagues.
Conclusion
Customer Centric is a strategy that aims to make the customer the center of a company's strategic planning , increasing their lifetime and reducing cancellations and potential dissatisfaction to achieve the organization's business objectives.
According to research, customer-centric companies are 60% more profitable than companies that don't focus on customers. (Super Office)
How about better understanding what this strategy is and what you need to do to implement it within your company? Keep reading this post!
What is Customer Centric?
The Customer Centric strategy, or Customer at the Center, as the name itself emphasizes, is when the company places the customer at the center of the strategy to achieve its business objectives .
Customer Centric companies focus their strategic planning on the customer experience , thus increasing loyalty rates and achieving better results.
What are the main challenges companies face in putting the customer at the center of their strategies?
Becoming a customer-centric company is no easy task. The main challenge lies in understanding —or, at best, anticipating —consumer desires and demands.
To achieve this, all company teams must work together toward a common goal: customer focus. This can only be achieved by implementing a customer-centric culture within the organization.
In other words, it is not enough to offer the highest quality product or service at the best price if the service, for example, leaves your customer dissatisfied .
Another very challenging point for companies that want to be customer-centric has to do with strategic planning and the discrepancies that can arise between the organization's financial objectives and the customer experience.
In other words, what should you do: abandon a more advantageous strategy for the company in exchange for a plan that prioritizes the customer, or vice versa?
In any case, know that customer centricity is a long-term strategy , with clearer results appearing after a long period of loyalty and strengthening of the relationship with the customer.
Benefits and advantages of putting the customer at the center
If you thought that the main objective of applying Customer Centric techniques is to increase customer loyalty, you thought right!
A Customer Centric company can increase customer lifetime value and reduce cancellations and potential dissatisfaction.
According to a survey by Bain & Co :
- Companies that excel at customer experience increase revenue 4-8% above their competitors;
- Superior experiences deliver 6 to 14 times greater customer lifetime value;
- Voice of the customer programs result in up to 55% higher customer retention.
How to apply customer centricity and become a Customer-Centric company?
As explained so far, a company considered Customer-Centric has as its main characteristic the centralization of all its strategic planning on the customer. Everything that is done within that organization aims to provide a satisfactory experience for its customer throughout their journey with the brand .
Establish a top-down culture and develop customer-focused leadership
To develop a culture focused on customer experience, start by fostering this mindset among the organization's leaders. This will help establish a healthy and productive culture at all levels of the company's hierarchy.
Listen to your customer so you understand their desires and expectations.
It's essential to have a thorough understanding of your customer's desires, challenges, goals, and general behavior to provide them with the best possible experience throughout their entire journey with your brand.
CRM (Customer Relationship Management) tools NPS, CES, or CSAT surveys . You can also manage your customer reviews. Learn more about Harmo .
Invest in the relationship
Customer relationships are one of the most important things your company can cultivate. It's an investment that often yields many rewards, even more than expected. For example, when a company has a good relationship with its target audience, they, in turn, may recommend it to friends and acquaintances, engaging in the famous "word-of-mouth" marketing .
Train your employees well to give them autonomy
With autonomy, your employees feel more confident making decisions that benefit the customer experience. They use creativity and different resources to make processes more efficient and faster.
Before you can begin improving the customer experience, you must first understand what is causing negative or high-effort customer experiences.
The Customer Effort Score is a survey metric used to measure the level of effort a customer put into resolving a specific issue with your company.
Use customer feedback to improve
Actively utilize feedback from your customers; from there, you can constantly improve your service.
The Feedback Economy presents a vital opportunity for businesses to succeed or fail. With consumers interacting with each other to decide how they feel about a brand, feedback holds immense power when it comes to choosing where consumers will spend their money.
Using customer feedback is no longer an option. It's a must for any company that wants to stay alive and thrive. Check out our webinar: What is the Feedback Economy and Why Should Your Company Care?
How to measure customer-centric strategy?
Churn Rate
Churn is a metric that represents the rate at which customers abandon or cancel products, services, or contracts. For successful business growth, the number of new customers must always exceed the number of customers who stop using the product or service .
Lifetime Value (LTV)
Lifetime value is the value of a customer's life cycle, that is, how much a customer spends with your brand throughout their relationship with it. More than just understanding how much revenue your customer generates and how much they invest, it's also important to identify opportunities to strengthen the relationship between them and your company and encourage them to invest even more in your product or service.
Net Promoter Score (NPS)
NPS , or Net Promoter Score , is a metric developed to measure customer loyalty. Generally speaking, the metric assesses the extent to which customers recommend a particular company, product, or service to friends, family, or colleagues.
Customer Centric Statistics You Need to Know:
In this topic, we'll present some statistics about Customer Centricity that demonstrate the importance of this strategy for companies.
Satisfied customers are more likely to remain loyal : According to research by Bain & Company (2019), companies that excel at customer experience increase revenue 4–8% above their competitors. Furthermore, these companies have a 55% higher customer retention rate.
Satisfied customers are more likely to recommend the company to others : Research from the Harvard Business Review (2018) shows that satisfied customers are 50% more likely to recommend a company to others. This positive word of mouth can generate new customers and increase sales.
Customer-centricity can lead to a 30% increase in employee productivity : When companies focus on customer satisfaction, employees are more motivated and productive. This is because they know their work is making a difference to the customer. (Forrester, 2017)
Customer-centricity can lead to a 25% increase in process efficiency : When companies focus on customer needs, they can identify opportunities to improve their processes. This can lead to cost reductions and improved customer satisfaction. (McKinsey & Company, 2016)
Companies that invest in customer-centricity see 50% higher revenue growth than those that don't. Investing in customer-centricity can lead to significant revenue growth. This is because customer-centricity can help companies improve the customer experience, which also influences customer satisfaction, retention, and referrals. (Forrester, 2021)
Conclusion
Being a Customer-Centric company is a strategy that brings several benefits to companies, both in the short and long term.
By placing the customer at the center of their strategies, companies can:
- Increase customer loyalty: Satisfied customers are more likely to remain loyal to the company, which generates more revenue and profit.
- Reduce churn: Churn is the rate at which customers abandon a company. By improving the customer experience, companies can reduce churn and retain more customers.
- Increasing Customer Lifetime Value: Customer lifetime value is how much a customer spends with a company over the entire duration of their relationship with it. By increasing customer satisfaction and retention, companies can increase customer lifetime value.
- Improve brand image: Satisfied customers are more likely to recommend the company to others. This helps improve brand image and attract new customers.
Furthermore, a customer-centric strategy can help companies achieve sustainable growth. By focusing on customer satisfaction, companies can create a solid foundation for future growth.
To implement a Customer Centric strategy, companies need to:
- Establish a customer-centric culture: This means that all areas of the company need to be focused on customer satisfaction.
- Listen carefully: Companies need to understand their customers' needs and expectations.
- Encourage feedback: Companies need to create mechanisms for customers to provide feedback on their experiences.
- Act on feedback: Companies need to use customer feedback to improve their products, services, and processes.
Finally, it's important to remember that a customer-centric strategy is an ongoing process. Companies must constantly adapt to changing customer needs and expectations.
