A customer-centric approach is a way of doing business with your customer in a way that it delivers a positive customer experience (CX) pre-sales and post-sale in order to drive customer loyalty, repeat business, and increased profits.

But, a customer-centric organization is more than just a company that offers good service.

Both Zappos and Amazon are good examples of brands that are customer-centric and have spent many years building a culture around their customers and their needs.

The true balance of power lies in the hands of your customers.

Even a single customer can have a huge impact on a company’s success or its downfall. This balance of power didn’t even exist even just a decade ago before everyone had easy access to public online reviews and social media. Your prospects and customers are going to share things about you on social media and ask their family, friends, and colleagues for recommendations; so either you work on the product development side or in customer service side of the business, you should always try to influence what they’re saying, and maybe then, what they’re saying about your company will be positive.

To successfully achieve this, it’s critical to take the customer-centric approach to every aspect of your business; from the training and on-boarding, you provide to the content you share, to the experience of your customers at every step of the way while using your product or service.

But, how important it is for an organization to be customer-centric?

The good news is that it’s becoming increasingly important.

Econsultancy in a recent survey asked about what is the most important characteristics to establish a truly “digital-native” culture.

The response to that question in the survey, leading all the responses with 58% was to be customer-centric.

Successfully achieving a customer-centric approach doesn’t just happen overnight. Instead, you need to begin from somewhere and in this scenario; it’s having an understanding of the definition of customer-centricity.

What does it mean to be customer-centric?

Customer centricity is an approach that’s based on placing your customer first and at the core of your entire business model. It is not just about providing good customer service, it means delivering a good experience, starting from the awareness stage, through the entire purchase process, and finally through the after-sales service.

Once you place your customer at the core of your business model and then add it to your customer relationship management (CRM) system, you can easily gather a wealth of data that will provide you with a complete 360-degree view of the customers. And then it can be effectively used to improve the CX.


  • You can easily identify the opportunities to develop products and services for your best customers
  • You can use your customer data to better understand their interest, buying behavior, and engagement
  • You can use customer lifetime value to segment your customers based on their spends

Focusing on the customer doesn’t just make sound business sense, but a based on research by Touche and Deloitte found that the customer-centric organizations are 60% more profitable compared to the organizations that were not customer-centric.

The challenges of becoming a customer centric organization

The shift of power between company and customer occurred during the economic downturn. And the customers became very selective about where they are going to spend their money, the organizations that won in this race were the ones who treated their customer with good service, respect, and created a meaningful relationship with them that lasted for years, some of which still exist till now.

During the same time period when the recession hit the economy, social selling and social media marketing had exploded onto the scene and mobile became a huge part of the customer journey. Now, customers can easily compare products or services across multiple devices and in real-time, which presented a major challenge for many organizations.

Research has found that many organizations are struggling with this inevitable change and are unable to become a customer-centric company, and the biggest challenge being unable to share customer data across teams.

Majority of the organizations don’t have all of the components in position to claim they are truly customer-centric, but the most critical part to remember is this; you need to begin with your customers, not your product or service and focus more on what your customers want to do.

By designing your organization from your customer’s perspective, your company will be more focused on the customer’s needs.

4 Best Practices to becoming a Customer-Centric Company

Being a customer-centric organization, you will want to anticipate your customer’s need and please them with your products or services which they might not have thought about, but will instantly fall in love with. So, a customer-centric organization builds policies, products or services, processes, and also a culture that is carefully built to support their customers with amazing experiences as they work towards achieving their goals.

The four best practices of customer-centricity that always stands out are the following;

  1. Organizations that are more committed towards the customer-centricity plan, analyze, and implement a carefully structured customer strategy that focuses on building and keeping loyal and profitable customers.
  2. The organizations that are committed to being customer-centric focus more on what the customer wants and needs, and then design products or services around that.
  3. The organizations that are committed to being customer-centric are more passionate, and truly believe that the customer comes first. These organizations believe that without customers, they cannot possibly achieve success and also want to see the world through the customer’s perspective. The marketers within such customer-centric organizations understand what the customers want, and also uses customer data to capture customer insights and share this across their entire company.
  4. The organizations that are committed to being customer-centric focus more on creating relationships that are carefully structured to maximize the customer’s product or service experience.

How to measure the success of a customer-centric company?

Every company will not have the same customer metrics to accurately measure customer-centricity. However, the two most valuable customer-centric metrics that should be carefully monitored are customer lifetime value (CLV) and churn rate.

Customer lifetime value

For any customer-centric organization, the most important asset is the customer. The profits earned during the retention period are usually known as customer lifetime value. CLV accurately measures the entire profit that your company makes from a given customer.

To calculate CLV from a given customer, take the revenue generated from that given customer than subtract the amount of money that you spent on serving them and adjust all of the payments for the time value of money. Another effective way to accurately calculate CLV is by taking average order value and repeat purchase rates.

Example; if $100 is the average order value and 20% is the repeat purchase rate, then $120 is your estimated CLV.

Meanwhile, true CLV helps you to better understand why it makes more sense to invest more in keeping your customers. It’s a better approach to get an understanding of the portfolio of your customer and also to segment your customer.

Churn rate

Acquiring new customers is increasingly getting more difficult. Hence, more organizations are investing heavily in keeping their existing customers instead of trying to find new ones. Here’s why?

  • Just a 2% increase in customer retention has the same impact on the profits as cutting the costs by 10%
  • The cost of acquiring new customers can go up to 5x more than keeping the existing customers
  • Companies on an average lose approx 10% of its customer base each year

Meanwhile, organizations having a high customer retention rate grow much faster.

Here, the key to success is to understand why customers leave a brand and at the same time why the customers stay with a brand. To calculate the customer churn rate, first measure the total number of customer who left during the last 12 months and then divide it by the total number of new customers for the same 12 months time period.

A Customer-Centric Approach to Customer Service

When you are on video chats or phone calls while working on the customer support and services side of the business for several hours per day, as a result, you develop a very instinctive degree of knowledge about your customers. And that’s a totally different point-of-view compared to what the VP of Product or the product manager gets; because the time spent while working on the customer support and services side of the business is very different.

What the people working on the product side of the business can find hard to do is take that instinctive knowledge from their customer-facing team members and then turn it into useful data to improve the product with.

A Customer-Centric Approach to Product Development

Good brands are led by product, but in order to be truly led by product, you need to consider your CX as more than what your product or service is on the set of screens your customers move through or on paper.

It’s not only about improving user flows, nut it’s the totality of the experience.

What’s the company impression that the customers get up-front? What’s the CX like at the time of purchase? What steps are you taking proactively to help your customers when they need it throughout the entire lifecycle, even after post-purchase? How does all this fit in with your broader product experience?

In order to effectively do that, the VPs of product need to avoid a false division of the customer perspective. And the teams internally are usually made up of, a support representative, a product person, a sales representative, etc., but customers don’t care about any of this, instead they are looking at you as a unified organization.

The people working on the product or service side of the business need to think like that too, and truly try to build a consistent CX throughout every step of the product. So, when you think about your customer journey, its map should include the steps leads and customers taken with sales, customer support, and marketing; with the product at the center. And to be highly product-driven, it is highly recommended to think broadly about your job function, where you spend your time, who you work with, and what do you aim to improve when you go to work every day.


To move towards becoming a truly customer-centric company is both long and complex but not be put off by this as even the tiniest changes to processes and policy can have a huge benefit for both your customer and employee.

Being a truly customer-centric company is the Holy Grail towards unlocking the total potential of customer value. So always put yourself in the shoes of your customers and also reduce customer effort and increase customer value.

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