How to Measure Customer Centricity the Right Way
Author: Maria Alejandra Lopez
Source: Customer Think
As a customer first strategist (hopefully just like you), I spend a lot of my time searching how to better measure customer centricity for my clients. I also do a lot of analyses on what customers really want today. I’m always trying to understand exactly the solutions customers need, desire and dream of having.
My regular searches include customer service, customer satisfaction, customer care and similar topic areas. Google is my best friend! However, I recently came across some surprising facts, which prompted this post. I believe they show a serious problem in the business of looking after our customers today. Read the article and then let me know whether or not you agree with my analysis.
Wikipedia, another online friend of mine, doesn’t have a definition of customer centricity! If you look up the term, you get redirected to customer satisfaction! Try it for yourself and see.
My other go-to source for definitions is businessdictionary.com which defines customer centric as:
“CREATING A POSITIVE CONSUMER EXPERIENCE AT THE POINT OF SALE AND POST-SALE.”
It then goes on to say
“A CUSTOMER-CENTRIC APPROACH CAN ADD VALUE TO A COMPANY BY ENABLING IT TO DIFFERENTIATE ITSELF FROM COMPETITORS WHO DO NOT OFFER THE SAME EXPERIENCE.”
Now although I find the definition limited, since it refers only to sales and post-sale activities, I do like the fact that it mentions three important elements of customer centricity:
- a positive customer experience
- adds value to a company
- enables differentiation
This clearly identifies three huge benefits of becoming (more) customer centric:
- A positive customer experience has been shown to increase both loyalty and advocacy. As we all know, it costs five times more to acquire a new customer, as it does to keep a current one. Therefore loyalty is an incredibly valuable benefit for a brand.
- Adding value to a company also increases the ROI of its marketing investments. This is something that marketing is challenged to prove today, with the risk of seeing their budgets cut. Luckily, what’s good for the customer is good for business. You can see many more facts and statistics about this in Forrester’s report “The Business Impact of Customer Experience.”
- The third benefit is just as important to the growth of a business. Enabling differentiation in this complex world is invaluable in standing out from the competition. In so many industries product performance and services are almost identical, so how can you stand out? By your customer care, that’s how and knowing what your customers really want . It has been shown that customers are willing to pay more for excellent customer service. You can read a summary of this and more in the summary report of the American Express research.
I would also add that what customers really want today is a seamless experience from pre- to post- purchase, as well as from on to offline. That’s how you deliver satisfaction and build loyalty.
Find out how good you are at customer centricity. Take the quiz now.
THE IMPORTANCE OF CUSTOMER SATISFACTION AND UNDERSTANDING
There is no denying that customer centricity is important. However some companies are (too?) slow to adopt best practices in this area, which concerns me for a number of reasons:
- It is now proven that it is important for the business, so what is stopping companies from quickly adopting a more customer centric approach? The longer they wait, the more they risk being beaten by a more customer friendly competitor. It’s no longer (just) about product performance.
- Customers are complaining – a lot – about the way they are being treated. Why are companies not accepting these criticisms as the gifts they are? Acting promptly before the issue becomes a social media viral discussion is essential today.
- Customer service is confused with customer satisfaction. Companies are happy when their customers say they are satisfied, but they should be looking not just to satisfy them but to delight them too!
As mentioned before, the research that prompted this post was a google keyword investigation of terms related to customers. Having seen the strong positive trend for the word customer, I then wanted to understand what it was about customers that was of interest. I found that both customer service and customer care showed almost identical positive trends.
However, when I looked at customer satisfaction and customer understanding the trends were flat and worse, minimal. (You can see the trend graph below with service in green, care in blue, satisfaction in red and understanding in yellow)