Customer Centricity: learn everything about it
Digital Transformation has completely changed the way companies should relate to their customers. Today, it is necessary to add more value to your proposal to show that your business is the best option over competitors. The challenge, however, is to get the idea off the drawing board, but the concept of Customer Centricity can help.
No wonder this is a culture that is being implemented by the leading companies across various sectors. To place the consumer in the spotlight has become increasingly important for those who wish to have not just customers, but true fans of their brand. The adoption of these practices in an organization, however, is not so simple, as it requires profound changes.
The best way for an effective transition to a customer-centric approach, therefore, is to understand everything about this strategy. To make this task easier, we have gathered the most relevant information you need to know about the topic in this article. Continue reading to learn more!
What is a Customer-Centric culture?
For a long time, the focus of a company was on its own product or service delivered to the market. With access to information and other technological advances, the order has changed. That is, now the consumer dictates the rules of the game. It is not enough to deliver the best price or the highest quality – brands need to understand what real value to their audience is.
Within this scenario, the concept of Customer Centricity arises. The idea is to place the consumer in the focus of an organization’s attention and strategies. All planning is designed to make the target audience, in fact, impacted by a certain action and, thus, have a great experience.
The culture requires a deeper change in habits, practices and behaviors of those who are part of these organizations. The analysis of customer data, for example, should be one of the priorities of any company. From them, you can build a plan that delivers an adequate final product to the consumer and makes him return to your business more often.
From marketing actions to service provided, everything is done according to the needs and preferences of your audience. The objective is to allow the audience to be more satisfied and comfortable when engaging with your brand. Meanwhile, it is possible to earn the trust of the customer, who is no longer just another consumer and becomes an ambassador of your brand.
In a context where loyalty is a common goal in business, the application of a Customer-Centric culture can make this path easier. Building a partnership between the company and the customer, makes for a lasting relationship. Moreover, nothing better than that to succeed in such a saturated market.
By implementing a Customer-Centric approach, the trend is for more actions and strategies to be adopted in order to improve the customer experience. In this way, your company gains more trust from its target-audience and differentiates itself from its competitors. With the customer in focus, results tend to emerge faster.
What is the relevance of this culture in the corporate market?
This culture has become so relevant that the entire market is adapting to offer new experiences to its customers. A study by Deloitte, for example, indicates that 88% of the companies are prioritizing the experience delivered to the customers in their strategies. It is impossible to ignore this trend and set your customers aside in your actions.
They need to be the focus of everything that is planned and executed by your company. No wonder, a survey by Walker shows 62% of the companies are going to invest in improvements to meet customer wishes. This also involves the execution of some strategies that solidify the culture within the organization, such as investing in interaction channels.
Here, omnichannel customer service becomes a priority for those who want to focus on the consumer. To get an idea, in a ten-year period, the number of companies investing in multiple contact channels jumped from 20% to 80%, according to a survey by PwC. So, understanding these practices will ensure a better brand positioning.
Additionally, another factor that cannot be disregarded is the consumer’s demands. With more information and access to different companies offering the same services, your bargaining power has increased considerably. Therefore, one negative experience with a brand, as shown by a study by Vonage, is enough for the customer not to return to do business with the company.
Within this context, your company must adapt in order to deliver the best customer experience. The entire market is understanding this trend and businesses from different sectors see a closer and healthier relationship with their customers as the best way to remain competitive in such a disputed scenario.
What are the main practices of the strategy?
Now that you learned about the topic, let’s explain how the Customer-Centric culture can be implemented inside an organization. In practice, some strategies are used in order to be customer focused. Check out the main ones!
Dissemination of customer insights
The purpose of the Customer-Centric culture is to put into practice the main insights and ideas that customers suggest. After all, the focus is putting consumer needs first. For this to happen, it is necessary to consider the changes, suggestions and improvements they consider important.
Whether you like it or not, it is this understanding of what needs to be executed that is going to direct all your strategies – even crisis management. To disseminate your customer’s insights is going to position and differentiate your company within the segment. It is from this posture the customers will really understand that your organization puts them in first place.
This does not mean that any idea should be transformed into a new strategy. In this way, it is necessary to make yourself available to listen, but also filter what comes from your clients. After a more detailed assessment, it is possible to define the most adequate strategies to adapt the consumer insights to your business model.
Ease of interaction
Customer Centricity is not only adapting to what consumers want, but also creating a closer relationship with your audience. So, it is necessary to think about ways to facilitate the interaction between company and customers. This work begins in the contact channels available to engage with the customers and the culture of your team when serving each customer.
In addition to the channels, your team needs to make itself available to talk, listen and exchange ideas about what can be improved by your company. The ideal is to facilitate any type of relationship between brand and consumer, allowing your shopping journey to be fluid.
Understanding the entire customer journey
More than anything else, a Customer-Centric culture focuses on understanding the entire consumer shopping journey. It is not enough to focus just on finalizing a sale, for example. The ideal is to think about all the phases of the customer relationship with your brand and do everything possible, so the consumer has positive experiences in all steps.
Adopting a 360o vision is what will allow this understanding. If you complete a sale, do not forget the customer and do everything to keep in touch with them. Even if this does not mean an immediate sale, it is what will enable the growth of a lasting relationship.
Adoption of tools to improve the experience
There is no point in just having the intention or making strategic planning – you must implement all the actions. In order to do this, you need to rely on tools that optimize the operational work. Look for a solution that makes it easier to make the necessary changes to improve the consumer experience with your brand.
The best example of the application of this culture is the use of a CRM (Customer Relationship Management) software. It makes it possible to centralize all the relevant information about your audience and ensure it is applied correctly. At the same time, it is an ideal tool to know what should be improved in your business.
Imagine that you want to implement an e-mail marketing strategy. It would be humanly impossible to do it manually without a great drop in productivity. The idea is that resources facilitate these improvements. By automating the delivery of e-mails, for example, everything becomes simpler and more precise, so your strategy works.
Another fundamental practice in the implementation of a culture based on Customer Centricity is getting constant feedback from customers. The entire concept is based on a fundamental premise: continuous improvement. After all, consumer desires and preferences change overtime, and your company cannot settle down and think everything is all right.
It is always good to find ways to improve your work. What worked in the first semester may not be as effective at the end of the year, for example. Customer needs are fluid, and so your strategy should be as well. And the best way to adapt to the different scenarios that may come up is by obtaining regular feedback.
A simple way of executing this strategy is to always ask customers for their opinions. Encourage them to leave their feedback whenever they have an experience with your brand. In the long run, the customer will come to understand that the opinion they gave on a particular service resulted in significant improvements in the experience, and, therefore, begins to trust your company even more.
What is the importance of applying Customer Centricity?
Implementing a culture of Customer Centricity results in huge benefits not only to the company but also to the customers. Check out what the advantages for both sides are, when there is a change of habits by the business!
For the organization
For the organization, a Customer-Centric culture allows the possibility of staying competitive within such a saturated market. It is also a way to differentiate your brand, and, therefore, be able to win consumer trust.
In the long run, it can position the business as a benchmark in a sector or even break market dominance. Additionally, it represents the best use of time and financial resources. Everything is used in a more precise way in actions and strategies that, indeed, collaborate to generate better results.
For the customer
The advantage for the customer is a little more obvious. After all, the customer becomes the center of attention of the company and gets even more personalized experiences throughout his shopping journey. The greatest benefit is in the gain of quality of service and/or products offered, with more information about what you will buy and greater chances to make better investments.
What are the best-known success stories?
There is nothing better than checking out some success stories with the implementation of Customer Centricity, to understand, in practice, how this concept works. That’s why we listed companies in different segments that can best prioritize their customers.
It is not so simple to begin a successful business within a very traditional market with dominant players. But Nubank succeeded by using Customer Centricity culture. It all started when one of the big players did not deliver a satisfactory experience to the company’s CEO, who then decided to start something new.
In the oligopoly of the banking market the user experience has never been an actual concern, not even with the demands raised by part of the consumers. To gain a sizable share of the segment – the 25 million customers who placed it as the 6th largest financial institution in Brazil – Nubank bet on Customer Centricity to attract more and more users.
Among the advantages are an application with a simple interface and all features easily accessible and the exemption of transfer taxes or account maintenance. These details place Nubank as a benchmark in its sector, considered one of the unicorn startups in the Brazilian market – valued at over a billion dollars.
In 2011, Netflix was considered virtually bankrupt in the United States. A simple decision, however, completely altered the trajectory of the organization: Netflix listened to what its customers had to say. Thus, the managers realized it was time to modify the business model and decided to bet on the streaming service, little known until then.
What Netflix delivered no longer interested its customer base. Thus, from consumer feedback, the brand decided to bet everything on digital services, but always taking into consideration what the users think about its features. If a person watched a movie, Netflix asked the consumer their opinion about the movie.
Every opinion is important for continuous improvement. With an established business model, the behavior has not changed. The Customer- Centric culture remains alive in the brand, looking for interaction with users in the most diverse platforms – including successful strategies on social media.
What are the most useful KPIs?
It is also important to be familiar with some tools that could help you measure if the results obtained with the change in culture are, indeed, efficient. Check out some metrics for evaluation and learn how to implement them!
Lifetime Value (LTV) is a metric that is widely used to understand the efficiency of strategies when placing the customer as the center of operations. It shows the net profit obtained from the customer in the company. Thus, the management can understand how much each customer spent and for how long.
In practice, LTV represents how lasting the relationship between the brand and the customer is, and what are the gains from it. The idea is to understand, for example, whether customers are spending more time with your brand or not, and what is the return to the company in terms of profitability.
From this indicator, you can understand what is the best time for a new approach. Through the balance found between customer spending and the time he spends consuming your products and/or services, you can have an idea if your strategy will be successful.
This is perhaps one of the most dreaded metrics by the companies: the churn. In practice, it means the total of cancelled contracts or customers who abandoned your base. So, it represents the customers who have stopped buying from you. Even if the dream of every manager is this indicator to be zero, this is not a simple task and should not be the biggest concern.
After all, customers can leave your business, and that is normal. The biggest problem is when your churn rate grows more and more. Typically, the calculation is made from the numbers of a given period, such as a month, a semester or even a year. Simply divide the number of customers who left your base by the total number of customers in your company at the beginning of the analysis.
Then, multiply the result by ten and you get to the churn. However, it is not because the rate increased from one month to the next that your strategies stopped working. It is very important to consider all the factors that influence this result. Monitor the metric closely, understand each case and do not let the churn grow successively over the course of a year.
Another way of evaluating if the execution of your Customer-Centric strategy is working is NPS. The Net Promoter Score is a methodology that seeks to identify and evaluate the degree of loyalty of consumers in your company. Easily executable, it is possible to understand the level of customer satisfaction in different points of contact along the journey.
All this is concentrated from a single question: would you recommend the company to a friend? Between 0 and 10, each customer should leave a perspective of the chances of recommending the brand to another person. This data is valuable, because it reveals the possible negative experiences of the public. And the same applies to positive experiences, when the indication happens next to 10.
Because it is only a question, NPS is even more reliable. Without many variables, the answer is straightforward to the consumer. The bigger the value, the better the experience delivered by your company. By dividing this audience into three groups (promoters, passives and detractors), you will have a clearer picture of what is working in your strategy and what needs to be improved.
In order to be successful, Customer Centricity cannot only be seen as a static concept in the operation of your company. It should be monitored, evaluated, and optimized often, according to the main demands and consumer behavior. The goal is to constantly update to improve the experience offered.
Now that you know what a Customer-Centric culture is, the practices that can be used, examples, and all its benefits, how about some more information? Subscribe to our newsletter to receive content like this!