Customer centricity – make it happen!

It should be obvious that the path to a bulging bottom line goes through happy and loyal customers, and most executives and managers have wised up to this at some point. But not many have cracked the code for establishing a genuinely customer-centric approach organization-wide.

It’s no easy feat, and you will have to challenge the way things are done time and time again. However, achieving genuine customer centricity isn’t impossible if you identify the biggest challenge early on in the process. We’ll come back to this – but first let’s get some terminological questions out of the way.

What is customer centricity?

Customer centricity is about focusing on the customer – rather than just the product. The customer’s needs, thoughts, and wishes come first for a customer-centric company, and everything from products to strategies starts with the customer.

The shining example that’s always highlighted is Amazon. The online shopping giant has achieved its dominant position by putting itself in the customer’s place and making the customer experience as positive as possible. They do this in everything, from innovative solutions like Alexa, Dash, and Echo to hassle-free checkout and personalized product recommendations.

In Scandinavia, IKEA is a prime example of customer centricity. Their stores are designed for feel-good purchase experiences – with features like inspiring interiors and budget-friendly meals. The online experience is also constantly evolving, and in the IKEA app, customers can even see how the furniture will actually look in their living room.

A customer-centric company isn’t just oriented toward its customers – it’s also oriented from the customer’s point of view. Meaning their perspective is always from the outside in – not the opposite. The aim is to view the company, products, and marketing from the customer’s perspective – and in so doing ensure that you remain relevant to the customer.

Successful customer centricity requires both solid insights and the right attitude throughout your entire organization. The market is full of good examples of genuinely customer-centric companies – and they are usually the market leaders in their field.

What is a customer-centric strategy?

As the term suggests, a customer-centric strategy puts the customer before everything else in the company. This means the customer determines how things like product development and marketing should be prioritized and executed. Full-scale customer centricity usually turns the business strategy on its head.

Traditionally, customers might be considered a component in the different departments’ sub-strategies. In a genuinely customer-centric strategy, however, the opposite is the case. The customer strategy trumps all else, and the different departments are assigned subsections and paragraphs to underpin a customer-centric approach.

What are the advantages of a customer-centric strategy?

The customer-centric approach has many advantages. If you have come to the realization that customers are the most important thing for your business, then a customer-centric strategy is a good way to continuously maintain that focus. It will also be easier for you to retain your outside-in perspective, and ensure that the customer doesn’t run into silos within your organization.

Silos stand in the way of the positive customer experiences, because your customers don’t care how your company is organized. They just want to be heard – the rest is your problem.

What are the disadvantages of a customer-centric strategy?

There are a couple of bumps and pitfalls on the road to customer centricity to bear in mind. Firstly, a customer-centric strategy is very demanding to implement and maintain. And secondly, it’s crucial that you avoid becoming obsessive about customer centricity. That can have a negative impact on innovation, because customers don’t always know what they want.

“If I had asked people what they wanted, they would have said faster horses.”

These famous words by Henry Ford are worth noting. Even though the customer is the primary focus, they should never be the sole deciding factor for your business.

Five steps for getting started with customer centricity

A customer-centric strategy can be difficult to implement in the real world, because it is often a complex and comprehensive process. Obviously there are big differences from company to company and industry to industry, but the following can be a helpful guide for most companies looking for a foothold in those tough early stages.

1. Present the business case. Calculate the potential of a customer-centric strategy so everyone can see what’s at stake. Putting concrete numbers on the table is especially good for helping senior management understand the importance.
2. Start with the structure. Translate your customer centricity objectives into concrete tools your company needs to master. Then you can begin building the necessary skills within your organization.
3. Motivate your employees. Make customer-facing employees stakeholders in the customer experience. Let them make decisions so they can help the customer as best they can here and now. With effective training and making sure everyone is on the same page, employees who take the initiative on behalf of customers will perform even better.
4. Meet your middle managers. Prepare them for the role so they are geared to drive the changes that customer centricity entails. IInspire them and give them the necessary tools and authority.
5. Tear down those silos. The internal organization of your company should never be something that customers or frontline employees notice. A not-my-responsibility attitude is poison for customer centricity, and you need to be prepared to implement radical restructuring.

The process is, of course, much more complex and wide-reaching than the five points presented above might suggest, and there are many cogs to consider.

Airbnb goes back to their roots – and embraces customer centricity

Customer centricity is alive and well out in the real world, and the concept is a leading light for many senior executives and managers. Airbnb has been a global leader among customer-centric companies for years, and the service is gaining ground the world over. Most people have heard of Airbnb, and it facilitated 393 million overnight stays in 2022 – which was also the company’s best at the time of publishing.

However, in fall 2022, something happened with the service, and many hosts suddenly experienced a crash in the number of bookings.. It became a hot topic on social media, and stories started appearing from former customers who had gone back to booking hotels.

Due to high prices, extreme and unpredictable fees, and, not least, long lists of cleaning demands from difficult hosts, Airbnb was no longer the hip alternative to a hotel that it had once been. It was as though the balance between host and customer interests had tipped – and the customer had been forgotten.

As Airbnb became aware of the seriousness of the issue, CEO Brian Chesky asked customers on Twitter what needed fixing. That resulted in May 2023 in a list of 53 customer needs and wants. It included better price transparency, new software features, and an end to unexpected check-out requirements like laundering sheets and emptying the dishwasher.

These initiatives were received with digital applause, and it appears that customer centricity has again become a leading light in the executive suite. Airbnb also happens to be one of the few giant tech startups with a positive bottom line.