What does it mean if a business is following the customer centric business model? There must first be a few assumptions met regarding the goods or services that are being provided. To follow this business model, the best possible product or service must be put up for sale every day. The moment a product could be improved, but is not, the customer centric business model isn’t being followed.
Once that point of emphasis is met, there are three primary characteristics of this business model that are followed by every business that has adopted it.
- There must be a focus placed upon fixing problems for the customer.
- Complaints must be handled in an expeditious manner.
- Individual customer preferences that are noticed by the business must be remembered.
In essence, this business model means that an organization must attempt to understand the point of view that the customer has at any given time. It also means that the customer must be shown respect at all times, even if they are upset for a reason that is beyond the control of the organization.
Isn’t Being Product Centric the Same As Being Customer Centric?
It can be difficult sometimes to distinguish the customer centric business model from the product centric business model. This is because an organization can only be successful if it is able to satisfy the needs of their customers and it must have customers that want an organization to satisfy their specific needs.
Being product centric means having goods or services that will meet a specific customer needs. Being customer centric means that the organization attempts to meet all customer needs as they can from an organizational standpoint. Instead of the goods or services being the only point of emphasis, the organization strives to do everything they can for the customer in order to provide more individualized value than the competition.
Some might say that being customer centric conflicts with being product centric. The way to think about the difference between these two business models is this: being product centric means providing one product of value to a specific customer demographic. Being customer centric means that all products at all times must be able to meet specific customer needs now and into the future.
The Customer Centric Business Model Is About Tunnel Vision
There’s a few interesting characteristics about the modern customer. They have a remarkably long memory. They are quick to leave a complaint and hesitant to leave a compliment. Many organizations believe they are following the customer centric business model, but are not because they are basing their judgments off of feedback they receive.
To be customer centric, and organization must reach out to discover the feedback from all of their customers whenever possible. That is because the value is placed on each action that a customer takes. Their memory dictates whether they will come back to do business with an organization in the future.
The experience a customer has today with a specific business or brand will dictate whether or not they will continue to do business with that organization.
The customer centric business model must have a tunnel vision when it comes to how customers interact and support the business. Organizations that ask for feedback and take it seriously while resolving complaints tend to survive better in the global marketplace today because they are making an effort to “walk a mile in the shoes of the customer.”
Even the attempt at a better understanding means a business is adopting this model in some respects.
This business model is not always easy to follow. Instead of focusing on the dollars and cents a customer provides, the organization must be focused on continuing to meet the needs of a customer. There is no emphasis placed on cost, margins, or budget requirements. If it is the right thing to do for a customer, then to be following the customer centric business model, that must be the action taken. If it means taking on debt, then debt gets taken on.
Many businesses incorporate some form of this model. How effective this incorporation tends to be is reflective of how saturated the business model is throughout every department. If all departments aren’t on-board, then a customer may find that an organization is trying to meet their own needs instead of focusing upon them.
There is no denying one fact: when customers see an effort being made to build a relationship with them, they are more likely to be loyal to that business.