How to create a customer-centric strategy in 2023
Customer centricity is the ability to understand consumers and make business decisions based on their needs. It's putting the customer at the center of everything you do.
Last updated March 16, 2023
Imagine wearily checking into your hotel after a long, stressful flight only to find an out-of-order elevator, which forces you to lug your bags up several flights of stairs—and then your room key doesn’t work.
Now re-imagine the scenario, except this time:
- The elevator works.
- The clerk delivers your luggage to your room.
- You conveniently use the hotel’s app to unlock your room door.
- You find complimentary snacks—complete with a handwritten note from the hotel staff—on your bedside table.
Like the hotel in the second scenario, a business delights consumers when it prioritizes their needs and interests. It’s essential to put your customers and their happiness at the center of your company’s customer-centric strategy to change your business for the better. You’ll enjoy greater customer loyalty and bigger profits as a result.
In this article, we’ll show you how.
- What is customer centricity?
- Why is customer centricity important?
- Challenges of being a customer-centric company
- How to measure the success of customer centricity
- 7 tips to become more customer centric
What is customer centricity?
Customer centricity is the ability to understand consumers and make business decisions based on their needs. Jonathan Brummel, director of enterprise support at Zendesk, offers a simplified customer-centricity definition: “Customer centricity is putting the customer at the center of everything you do.”
- Customer-centric companies put their customers at the heart of everything they do, which increases loyalty and reduces churn.
- Becoming a customer-centric organization takes time and effort but can be accomplished by following seven easy tips.
- Monitoring key metrics and gathering customer feedback can help you more accurately measure your company’s customer-centricity.
Why is customer centricity important?
What is the impact of customer centricity on your business? Customer centricity keeps brands focused on what their audience wants. If consumer behavior shifts, no biggie—the company adapts its products and operations to meet demand. If you evolve correctly, you’ll see major business improvements.
Create better products for your customers
When you truly understand customer wants and needs, you’re in a better position to build products customers love.
In the past, many business leaders opted for product centricity, an approach that prioritizes enhancing products regardless of demand. This mindset can lead to high-quality products—but not necessarily innovative ones.
Consider portable music players. Sony could’ve kept upgrading the Walkman, and Apple could’ve kept refining the iPod. But once smartphones arrived with audio apps, the market found a new way to listen to music, and improving the portable music player became obsolete.
Boost customer loyalty
Unique products attract buyers to brands, but the products alone aren’t enough to foster customer loyalty. Companies that take a customer-centric approach and create great experiences around their products will see the lowest rates of customer churn.
Say you download an audio app to listen to music on your phone. But what happens if a similar app comes along?
To keep you around, the app company can personalize your experience by sending weekly music recommendations, prebuilt playlists, or new music based on your listening preferences. This experience can build anticipation, strengthen the emotional connection, and encourage you to continue using their app.
Improve efficiency through customer feedback
Customer-centric brands look forward to customer feedback. Asking consumers for input can help you adapt your operations to better meet their needs and help you improve the product and customer experience.
Imagine your support agents report an uptick in callers asking for help with a certain app feature. To ease the strain on your agents, you can create a series of “how-to” videos addressing pain points and include links to them in every app download confirmation email, newsletter, or in-app message.
The challenges of becoming a customer-centric company
Customers are spoiled with choices and will stick with companies that prioritize their wants and needs. Every business strives to retain customers and reduce churn but may not completely understand how closely linked customer centricity is to achieving those goals.
Here are a few challenges companies might face on the path to becoming more customer centric.
Securing executive buy-in
Building a customer-centric culture is crucial to transitioning to a customer-centric company—and it starts at the top.
Companies that have been around for a long time tend to be less comfortable with disrupting the status quo and evolving their mindset with the changing times.
Top management sometimes makes decisions based on metrics and ROI—which doesn’t always exist for certain areas of the customer experience—and can keep them skeptical about making changes. Without commitment at the top, businesses will fail to embrace a new company culture and put good customer experience at risk.
Evolving social messaging trends
Customers are increasingly turning to social messaging apps to connect with companies, and customer-centric organizations have noticed.
According to the Zendesk Customer Experience Trends Report 2022, inquiries over WhatsApp, Facebook Messenger, and WeChat surged 36 percent in 2021—higher than any other channel.
Our report also revealed that over 70 percent of consumers expect conversational care that eliminates hassles, like repeating themselves to different agents. Simply put: customers want to have an easy, seamless conversational experience.
As conversational customer service continues to rise, companies need to evolve with social messaging trends to meet customers where they are.
Ineffective technology platforms
Some businesses might understand what it takes to become customer centric, but they don’t have the tools or technology in place to integrate customer centricity into their operations.
Giving agents the tools they need and improving the employee experience results in faster response times and more personalized experiences for customers.
Investing in a CRM that includes innovative features—like artificial intelligence, seamless channel-switching, and enhanced customer visibility—makes for a better customer and employee experience.
How to measure the success of customer centricity
There is no magic number to measure customer centricity. But you can use the following metrics to paint a holistic picture of how well you’re basing business decisions on your customers and their needs.
Customer satisfaction score (CSAT)
Customer satisfaction score (CSAT) gauges the quality of customer service and product experiences, making it a good starting point for measuring customer centricity.
How to measure CSAT:
- Send a survey via SMS, email, or chat as soon as a customer support interaction ends. Ask the consumer, “On a scale of 1 (very unsatisfied) to 5 (very satisfied), how would you rate your overall satisfaction with the support you received?”
- Ask an open-ended question like, “Did the agent exceed your expectations? Why or why not?” Use this feedback to spot lapses in customer centricity.
- Once you have your survey responses, calculate CSAT by dividing the total number of customers who are “very satisfied” (5) or “satisfied” (4) by the total number of responses. Then, multiply that result by 100.
This type of feedback provides valuable intel that you wouldn’t have otherwise known. Say customers reply with low scores and complain they were transferred multiple times before speaking to the right agent. There might be an issue with your interactive voice response (IVR) software, and you can take the steps necessary to resolve the problem.
Ideally, you want your CSAT score to increase over time. If CSAT declines, determine the root cause and remedy it.
Customer churn rate is the percentage of consumers that stop doing business with you over a specified time frame. If your efforts aren’t paying off, your churn rate will either hold steady or increase.
This metric is the easiest to measure if you have a subscription-based business model because you can see how many subscribers cancel each month, quarter, or year. When evaluated alongside other metrics, it’s a great way to assess what you’re doing well and where you need to improve.
To calculate churn rate, use the following formula:
If your customer service reps receive strong CSAT scores but your churn rate remains high, then your product probably isn’t meeting customer expectations.
Customer lifetime value (CLV)
Customer lifetime value (CLV) tracks the amount of money a consumer spends throughout their relationship with a brand. If your company is customer centric, your buyers will stick with you longer, which means your CLV will be higher.
Here’s how to calculate CLV:
If your CLV consistently decreases month over month and you’ve ruled out product issues, you should check for a decline in CSAT scores. According to our Customer Experience Trends Report, 61 percent of consumers would switch to a company’s competitor after just one bad customer service experience.
7 tips to become more customer centric
Customer centricity doesn’t happen overnight. It may require a complete cultural shift in the organization and training staff on how to be customer centric. Start with the following tactics, and you’ll be on your way to strengthening customer relationships and growing your business.
1. Provide generous customer service
Customer care is an afterthought for some companies, and many consumers know it. But it can mean the difference between buyers coming back or leaving for good.
According to our CX Trends Report:
- 54 percent of buyers believe customer service isn’t a priority for most businesses they interact with.
- 81 percent of shoppers say a positive customer service experience increases the likelihood they’ll make another purchase.
Make a good impression by enabling your support agents to go the extra mile. Chewy offers one of the most endearing customer-centricity examples. When the company heard that a customer’s two dogs had passed away, the customer service team sent the customer a sympathy gift to show their support: a portrait of their pets.
Chewy went above and beyond to deliver a customer-centric experience, offering its customer some emotional nourishment that they’ll never forget.
2. Use a customer journey map to anticipate customer needs
A customer journey map visualizes all your touchpoints so you can better understand your buyers and deliver positive experiences each time they interact with your business.
Consider a competitive industry like hospitality. Hotel brands are always seeking fresh ways to retain their most loyal customers. Before Hilton released a contactless arrival app for its Honors members, the company likely mapped out all possible member pain points and ways the app could remedy them.
Booking a room: It’s often difficult to reserve a room on a mobile device because guests can’t tell if the room is facing the parking lot or the ocean.
Solution: We’ll add a property map to the app and make booking a room similar to selecting a seat on an airplane.
Checking in: We don’t want Honors members to wait in line to check in, especially if it’s late.
Solution: We’ll let members check in with a few app clicks so they can head straight to their room upon arrival.
Room entry: Key cards sometimes fail.
Solution: We’ll program the app to unlock the door so Honors members don’t have to visit the front desk—where there might still be a line—for a replacement key card.
Customer support agents are often the first to hear if an experience failed to meet expectations. Their empathetic response can maintain the customer relationship, and they can relay common issues to the marketing or operations team.
For example, hungry Honors members who traveled a long distance might complain that they can’t order room service from the app and have it waiting for them upon arrival.
3. Collect customer feedback
Customer feedback provides your company with valuable insight into how the buyer feels about certain facets of your business. You can use that information to make better customer-centric decisions and improve products, services, and internal processes. Best of all, it can help you build stronger relationships with your audience.
In 2008, Starbucks took collecting customer feedback to another level with its My Starbucks Idea platform. The concept was simple—customers created a profile and submitted ideas on how to improve the company. What set this apart from being a glorified “suggestion box” were the features that allowed other users to vote and comment on ideas, creating a community.
You don’t need to have a unique system to capture feedback like Starbucks, though. You can collect customer feedback collect customer feedback through various channels, including customer surveys, customer reviews, social media posts, Voice of the Customer (VoC) programs, and support tickets. Agents are on the front lines and can tell you what customers are saying and how they’re feeling about your company, products, and services.
Not all feedback is positive, but negative feedback can be the best kind of feedback, as it enables you to implement changes that’ll make your business better.
4. Centralize customer data
Say a jet-lagged Hilton Honors member DMs a room-related question to Hilton’s Facebook account. They don’t get a response, so they call Hilton’s support team. The agent is unaware of the DM, so the now-irritated customer has to rehash the message. Had the agent known about the Facebook DM, they could have provided a more customer-centric experience.
Brian Durney, CTO for online jeweler Chupi, wanted to avoid such situations. He said, “We needed a way to pull all of our customer data into one place. We needed all of our calls, tickets, and DMs from social media going into one platform.”
Durney suspected what our CX Trends Report revealed: 92 percent of customers will spend more with companies that ensure they won’t need to repeat information.
92% of customers will spend more with companies that ensure they won’t need to repeat information.
Durney turned to Zendesk to track these various customer interactions. Agents were able to view them in a single easy-to-navigate interface. The result? “In 2020, we had a 300-percent increase in care-based sales, resulting in 1 million euros in sales directly from the customer care team,” Durney reported.
5. Enhance customer experience with artificial intelligence (AI)
For businesses unable to offer 24/7 live support or hire more agents during busy periods, AI can help ensure customer service teams remain customer centric.
Chatbots use AI to answer common support questions and route inquiries to agents when necessary. AI-powered bots can also automate SMS and Facebook Messenger responses.
According to Solvvy’s State of Chatbots Report:
- 80 percent of customers will use a chatbot if one is available.
- 47 percent think they may have possibly mistaken a chatbot for a live agent at some point.
Presentation software provider Prezi adopted chatbots when it saw a massive surge in support tickets in 2020. The pandemic-induced switch to online learning coincided with the release of the company’s new video presentation product. The chatbots complemented Prezi’s 25 support agents, freeing them up to focus on more complex issues—and to show the care so many new customers needed during a challenging time.
Bear in mind that chatbots and other AI-powered channels aren’t customer centric by default. According to the Solvvy report, 65 percent of consumers are more likely to leave a business due to a negative experience with a chatbot. Make sure bots’ automated responses keep up with evolving customer needs by sending a short survey after each chatbot exchange.
6. Embody your values and company culture
A customer-centric company doesn’t just create products and experiences its audience loves. It develops a strong company culture and lives by its values. It also understands its customers’ values and puts them into practice.
Brands that adopt a culture that prioritizes supporting issues they—and their buyers—care about stand to make a positive difference and grow their customer base. According to Havas Group’s Meaningful Brands Report:
- 64 percent of consumers like to buy from purpose-driven brands.
- 53 percent will pay more for products from businesses that take a stand compared to ones that don’t.
Customer-centric companies should take a page from Patagonia’s playbook.
- Patagonia has pledged 1 percent of sales to the preservation and restoration of the natural environment since 1985.
- The brand refuses to attend a popular trade show in Utah because of the state’s public land-use policies.
- Patagonia founded a nonprofit, 1% for the Planet, that brings other environmentally conscious businesses together to collaborate on projects.
Of course, you don’t need to start a nonprofit to have a social impact. Advocacy can start small. You might donate a portion of each sale to a single charity your customers support and promote that charity on your website’s checkout page.
Authentically embody social responsibility to spread positivity, humanize your brand, and give your customers a sense of pride.
7. Prioritize customer retention
Keeping an existing customer happy is more cost-effective than attracting first-time customers, so it makes sense to prioritize customer retention. Repeat customers are more likely to buy from you again, spend more at the checkout line, and tell friends and family about your company.
- Fast support
- Meeting customers where they are
- Incentivizing loyalty
- Gathering and using customer feedback
Tesla hyper-personalized its customer experience by creating a customer-centric product that learns about the driver. The company’s electric cars adapt to the needs and preferences of the driver as soon as they leave the dealership. At the push of a button, a driver’s personalized profile kicks in, automatically adjusting the suspension, lights, radio presets, and more.
These unique features helped create a community of lifelong customers: 91 percent of current Tesla owners say they wouldn’t hesitate to buy another one.
The value of a customer-centric culture
Building a customer-centric culture in your organization can take a lot of work, but it’s worth the time and expense. Focusing on your customers helps your company create better products and services to meet their expectations. When your buyers are happy, that means a better bottom line.