Customer Centricity: Customer focus as corporate philosophy

Customer Centricity

Customer Centricity: Customer focus as corporate philosophy

Customer Centricity changes the way the relationship to potential and existing customers is built and maintained. Its purpose is to provide and increase the so-called Customer Lifetime Value, in other words to offer customers a real added value and thus keep them longer. Becoming a truly customer-focused organization requires time. And constant engagement.


Customer Centricity means doing business with your customers in a way that your customers perceive their experience as positive, before and after the purchase. This directly leads to better customer loyalty and later to new purchases and thus also to increased profits. However, customer orientation means more than just good service.


The history of Customer Centricity

The shift of power from brand to customer occurred during the economic recession in 2008. Customers became more selective in their decision which brand they wanted to give their money. The winners were those who treated their customers with respect and better service and had developed a relationship with them. During recession, social media marketing and social selling exploded and the mobile phone became an important part of the customer journey. Customers can now compare products and services in real time and over several devices, which increases competition.


The basics of Customer Centricity

Customer focus does not only mean delivering great customer service, but also a fascinating customer journey from the first contact with the brand, through the purchasing process and all the way to the post purchase process. It is a strategy aimed at always focusing on the customer. We compiled for you the following best practices:

  • You must start with your customers, not with your products, and concentrate especially on tyour customers' preferences. By shaping your company from your customers’ point of view, your company will be oriented towards the customer’s needs.
  • By being customer-oriented, you will anticipate the needs of your customers and feel the need to delight them with products and services. This is how a customer-focused brand creates products, processes, guidelines and a culture, aimed at supporting customers with a wide experience in achieving their objectives.
  • Customer-focused brands are passionate and truly believe that the customer comes first. They believe that without customers they cannot be successful on the market and want to see the world through the customer’s eyes. Marketing specialists in customer-focused companies understand what customers want and use customer data to collect customer information and exchange it company-wide.
  • Customer-focused brands concentrate on what the customer wants and needs and develop their products and services based on these desires.
  • Customer-focused brands concentrate on building relationships, aimed at maximizing the customer’s product and service experience.
  • Customer-focused brands analyse, plan and implement a carefully formulated customer strategy, focused on obtaining and keeping profitable and faithful customers.

    Measuring the success of Customer Centricity

    Not every company will have the same performance indicators for measuring customer orientation. However, the two most important customer-focused values, which need to be carefully monitored, are Migration Rate and Customer Lifetime Value.


    1) Migration Rate

    Winning new customers is becoming more and more difficult. This is why companies should invest more in the loyalty of existing customers rather than trying to find new ones. Winning new customers may cost up to 5x more than keeping existing ones. Increasing customer loyalty by 2% has the same effect on profit as a 10% cost discount.


    On average, companies lose about 10% of their customer base each year (also known as Customer Churn). Besides, companies with a high loyalty rate grow faster. In order to calculate the churn rate, quantify the number of customers who have left in the past 12 months and divide it by the average number of total customers (in the same period of time).


    2) Customer Lifetime Value (CLV)

    For a customer-focused company, the customer is its most valuable asset. The profits obtained during the retention phase are often called Customer Lifetime Value or CLV. Customer Lifetime Value (CLV) measures the profit obtained by your company with a certain customer.


    To calculate the CLV, take the income received from a customer, deduct the money spent by you on his loyalty and adjust all the payments to the time value of money. Calculating Customer Lifetime Value helps you understand why it is useful to invest in the loyalty of your customers. It is a great opportunity to understand your customer portfolio and to segment your customers.



    The term "Customer Centricity" has a firm place in the vocabulary of each marketing expert for some years now. However, what is overlooked by many is that with the help of a smart customer loyalty tool, they can please not only the customer, for instance with regular rewards in the form of discounts or small gifts. They can also learn valuable things about their customers and can adjust their business and its processes accordingly. Always put yourself in your customers’ shoes and minimize customer effort while maximizing your customers’ benefit.

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