What the heck is Customer Centricity?


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Reading the very interesting post Customer Centricity is MORE than Customer Experience by Joseph Michelli I engaged into a discussion about things centricity. The discussion basically is about answering the question “What the heck is customer centricity?” – this elusive thing.

And how does it relate to customer experience and other ‘centricities’, like price centricity, product centricity, or service centricity?

When do we call a company customer centric?

Of course there are some usual suspects that can be used as examples to make one point or another.

Is Ryanair customer centric? Aldi? Amazon? Apple? Google? Starbucks? Jiro’s sushi restaurant?

Luckily all participating disputants have a different view, so there is a vivid discussion going on, from which one can learn a LOT.

But first things first. Let’s get the issue of customer centricity vs. customer experience out of the way. Joseph states, that “customer centricity is a commitment or a strategy to assure the success of your customer. Whereas, customer experience is a set of customer perceptions forged across all their interactions with your brand.” (emphasis by Joseph Michelli). In brief: customer centricity is a strategy and customer experience is an outcome.

This distinction is important, as not only a customer centric strategy leads to customer experiences (plural, every interaction with your brand results in an experience), which accumulate to customer experience (singular, the weighted sum total of all customer experiences over time).

So, let’s assume there are four possible pure strategies: customer centric, price centric, product centric, service centric, and put a stake into the ground by briefly defining them.

I call a strategy service centric if all decisions that a company takes revolve around providing best possible service in the market.

It is product centric if all decisions revolve around having the best possible product in the market.

A price centric strategy tries to establish the best possible (typically lowest) price in the market. For the sake of the discussion here I treat a price centric strategy as the same as a process centric strategy, as lowest price comes only with optimally streamlined processes.

Finally, a customer centric strategy is one that establishes the best possible outcome for the customer.

Of course all and any of these strategies are to be seen in a business context, most notably in the need of staying profitable.

And mostly they turn up in a combination. There rarely are pureplay strategies, with the possible exception of the price strategy. Ryanair, or Aldi can serve as examples. I am sure there are more.

Where the first three are very different from the last one is that they have an inside-out focus whereas the customer centric strategy has an outside-in focus. It first looks at the customers and their needs and then evolves its product, price, even the organization around best fulfillment of these needs, or providing best value to the customer – again, within the limits of staying profitable.

But, all of them lead to customer experiences and consequently to customer experience. Just that they are very different.

Experiences have some relation to expectations. If you expect a no-frills experience and receive exactly that, you are more prone to be satisfied. If you expect something gold-plated and receive copper, you are not. If you expect something gold-plated you are also more likely to go to further lengths to receive it. These lengths may actually become part of the (positive) experience, as they suggest exclusivity.

This is, where the simplified Maslov pyramid of expectations comes into play that I described in earlier posts, e.g. here.

Price pure-plays will be able to fulfill the base expectations; there is no frill, no real ease for the customer and surely no wow.

Product and service strategies, especially the latter, have the potential of adding ease to the mix. The value for the customer increases, and so does the experience (if done right). Customer centric strategies then also offer the possibility of a wow – the possibility, not the promise.

In order to achieve this, customer centricity needs to encompass elements of all the other strategies. All aspects of the customer life cycle need to be looked at out of the customer’s eyes and the organization needs to be built around what the customer sees. Or else it will be impossible to put the customer at the center.

I’d argue that only customer centric strategies result in truly loyal customers. The other strategies in captive ones.

Am I right? What do you think?

Republished with author's permission from original post.

Thomas Wieberneit

Thomas helps organisations of different industries and sizes to unlock their potential through digital transformation initiatives using a Think Big - Act Small approach. He is a long standing CRM practitioner, covering sales, marketing, service, collaboration, customer engagement and -experience. Coming from the technology side Thomas has the ability to translate business needs into technology solutions that add value. In his successful leadership positions and consulting engagements he has initiated, designed and implemented transformational change and delivered mission critical systems.


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