Customer-centricity has become an important topic. It’s defined as the ability of people within an organization to understand customer situations, perceptions, and expectations. It’s about putting the customer first and the customer always being at the center of everything you do. In theory, it sounds relatively simple to implement, but is it? Becoming customer-centric is more than just saying the customer is at the top of mind – it’s about truly understanding their wants, needs (and also providing them things they didn’t know they need but do), as well as communications preferences to create meaningful experiences and build lasting relationships, which is, truly, easier said than done.
A customer-centric business approach is more critical than ever for business success. According to TrustPilot, a totally satisfied customer contributes 2.6 times as much revenue as a somewhat satisfied customer and 14 times as much revenue as a somewhat dissatisfied customer. The primary objective of your business must be to create a consistent customer experience (CX) across all touchpoints to exceed customer expectations. We’ll explain some steps your business can take to develop a customer-centric culture that turns new customers into loyal brand advocates.
Why is Building a Customer-Centric Culture Important?
Building a customer-centric culture is a way of doing business that focuses on delivering a positive customer experience before, during, and after a sale, but why is it important? For one, customers will leave your brand for a competitor if they aren’t happy. According to Forbes, a staggering 96 percent of consumers will switch to a competitor after more than one bad experience, and only one in five consumers will forgive a bad experience at a company whose customer service is rated as “very poor.” Seventy-eight percent of customers have backed out of a purchase due to a poor customer experience.
Encouraging a customer-centric environment will increase customer satisfaction and loyalty, resulting in stronger relationships, higher retention rates, driving innovation, keeping customers happy, and generating more customer referrals. Satisfied customers are more likely to “spread the word” about their experience, meaning your business gets free word-of-mouth advertising. Providing a world-class customer experience (CX) also allows your brand to stand out from the competition, which leads to acquiring and retaining more customers. Keep in mind that acquiring a new customer costs seven times more than maintaining an existing one, and increasing customer retention by five percent can increase profits from 25 to 95 percent! Providing excellent CX will save and even increase your business revenue in the long run.
Your organization may provide a service or product that’s similar to another business, so implementing a customer-centric culture can lead to customers choosing your company over theirs since most customers value a positive experience as much as the product’s performance. Developing a product that exceeds customer needs, anticipating their wants, and personalizing your service are excellent ways to build a customer-centric culture that makes your customers brand ambassadors.
In order for your customers to become brand ambassadors, your business must understand their needs. Let’s look at how you can anticipate their needs and better understand your customers.
Understanding Your Customer’s Needs
Understanding your customers and their needs is an important element of producing a thriving customer-centric culture and delivering world-class customer service. Preparing your business and anticipating customer needs will help you tailor nearly every aspect of your business. There are two types of customer needs – physical and psychological, which often overlap and make it challenging to distinguish between them.
Physical needs are easier to identify because there are straightforward solutions. If someone is thirsty, they need something to drink. Psychological needs are a bit more challenging to figure out but are the more powerful driver of customer decisions. While a physical need tells the customer they need something to drink, a psychological need directs them towards the drinks that provide them with a specific feeling.
Your business must consider its customers physical and psychological needs and what they are, which include the following:
- Their budget
- The service they expect
- Reliability & sustainability of your product/service
- Transparency throughout the buying process
- Empathy from customer service reps
- Feeling valued throughout the buying process
The only way to genuinely understand your customers’ needs is by thoroughly analyzing their physical and psychological needs. Here are some steps you can follow to understand customer needs and turn that information into results.
- Collect Feedback from Your Customers: The feedback you gather directly from the customer is among the easiest and most effective ways to learn about their preferences. The largest organizations globally use this approach to understand and anticipate future customer needs. There are various ways of retrieving customer feedback, including surveys, interviews, and social listening. No matter which technique you use, make sure the entire team is included throughout the process.
- Pay Attention to the Competition: Your competitors can shape customer expectations and needs, so it’s important to pay attention to what they’re doing. To see how your customers perceive the competition, you can use the same feedback strategy as the last section, but make sure to modify the questions to reflect that you’re gathering feedback about other businesses.
- Develop a Customer Needs Statement: A customer needs statement offers an in-depth overview of your customer, and it helps each department ensure the end product offers the features and benefits that satisfy the customer’s needs. It should cover who they are, why they buy, how they buy, how much they can afford to spend, and what they expect from your business.
Now that you understand your customers, we’ll discuss some of the challenges of implementing a customer-centric culture and what steps you can take to overcome them.
The Challenges of Adopting a Customer-Centric Culture
A customer-centric culture allows you to delight your customers, build a brand they love, create reasons for them to stay, and drive innovation. When you deeply understand your customers, you’ll make better decisions. The secret to success for companies is to have a system in place, but customer-centricity is often easier said than done. Implementing a customer-centric culture requires a strong commitment and ample resources from your business. The most common challenges include functional silos that prevent customer data sharing, culture that’s not aligned around the customer’s needs, missing technology platforms to manage data, and no common definition of customer centricity.
According to research from Deloitte and Touche, customer-centric companies were 60 percent more profitable compared to those not focused on the customer. Despite these findings, most organizations don’t have the necessary components in place to claim they’re customer centric. Customer-centricity starts by focusing on what your customers need and how they want to interact with your business – not your product or its features. When you build your company around the customer’s perspective, your organization can meet the customer’s needs to deliver a positive CX.
It all begs the question – how can you build a customer-centric organization to set your business apart from the competition?
How to Build a Customer-Centric Culture
If you’ve ever wondered why so many companies struggle to get customer-centricity right, consider this – the volume, velocity, and variety of existing customer data often overwhelm organizations. Most organizations’ cultures remain product-focused or sales-driven, and customer-centricity may only be a priority for support or marketing departments. However, your business must adopt a culture that aligns with everyone to successfully implement a customer-centric culture and operating model.
To build a customer-centric business, here’s the recipe you should follow:
Define Your Customer-Centric Approach
Numerous organizations struggle to adopt a customer-centric approach since they tend to deviate from prioritizing the customer as the initial focal point. Rather than contemplating your own or competitors’ actions, start by defining your own customer. What are their necessities, budget, and values? After that, determine what modifications are necessary to prioritize your customers’ interests at the heart of your business strategy.
Anticipate Customer Needs
Innovative ideas surpass the present requirements of customers and anticipate future needs. It’s crucial to keep a close eye on industry forecasts and trends to plan for what your customers might demand in the future. Providing a forum for customers to express their needs and desires can also aid in discovering what they expect from your business down the road. This can be achieved through customer focus groups and interactive surveys on social media.
Hire Employees that Fit Culture
The employees of your organization are the face of your brand, and they can serve your business best if they align with your company’s values. Creating a team of passionate workers can guarantee top-notch customer service. When seeking customer-centric staff, key qualities to consider include exceptional communication, a proactive attitude, and strong collaboration skills.
Shift from Product-Centricity to Customer-Centricity
Organizations that are product-centric place value on the sale itself and the amount it adds to their bottom line. For many businesses, it’s not a bad way to do business. However, a customer-centric way of thinking shifts importance away from the transaction and places it on the relationship you’re building with the business that purchased your product.
By prioritizing the needs and desires of the customer, customer-centricity leverages data to communicate tailored messages at the opportune time, thereby encouraging customer loyalty and establishing a meaningful rapport. Conversely, product-centricity disregards this valuable information, resulting in reduced company efficiency, flexibility, and profitability.
Implement the Right Technology and Tools
The experts at P2P are ready and willing to work with you and your business to help you create the customer-centric culture necessary for success. We can help you prioritize the needs of your customers while delivering exceptional experiences. This will help foster long-term relationships and customer loyalty.
“The P2P team has played a crucial part in the growth of Viirtue. Having their experts be a part of, and collaborate with, the Viirtue team across multiple disciplines and various department needs has made making business decisions easier than ever, thanks to their valuable industry and data-driven opinions and widespread product and market knowledge.”
-Daniel Rosenrauch, Viirtue
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