There's Customer-Centric, and Then There's Customer-Centric

It seems to me that talk of customer-centric marketing or customer-centric retailing is an unnecessary redundancy. What is marketing if not customer-centric? How can one even think of marketing without a focus on the customer? Isn’t that what marketing is all about? Apparently not!

Customers spot it right away when companies are not customer-centric. In customer insight sessions that I run, they regularly say things like “it’s all about them; all they want to do is sell me something” or “they really don’t care about me; if they did, I’d hear from them more often.”

When I speak at conferences or workshops, I often ask members of the audience to indicate whether their companies are customer-centric — virtually every hand goes up. It’s simply not acceptable in 2007 to admit to not being customer-centric. But, if you ask their customers, you will likely get an entirely different picture. The problem is that many companies are customer-centric in a very company-centric way. Their focus on customers extends to how they can extract the highest short-term sales from them.

I’ve just finished reading the second edition of Scoring Points, a delightful book by Clive Humby, Terry Hunt and Tim Phillips, that chronicles the strategy behind Tesco’s brilliantly successful Clubcard program. The authors describe how Tesco set out to build customer loyalty on the back of its loyalty scheme; a scheme by the way that is anything but a typical loyalty program.

My experience with Tesco is that it is one of the most customer-centric companies anywhere. Tesco is a company whose stated purpose is to “create value for customers to earn their lifetime loyalty.” It is also a fundamental goal of Tesco to “understand customers better than anyone else.” The difference between Tesco and dozens of other customer-centric companies is that Tesco understands the connection between customer insight and the creation of value for customers.

I would go so far as to suggest that it is virtually impossible to create the kinds of value that customers truly appreciate without first having gathered a great deal of knowledge and insight about customers. As Tim Phillips illustrated in a recent CustomerThink article, Tesco does more (and more unconventional) customer research than any other retailer and the results they get reflect the value of the information they gather.

Being customer-centric means being curious, insightful and creative. The most customer-centric companies I know are those that don’t limit themselves to conventional market research, but instead employ all manner of creative means to understand their customers, what they are going through in their lives, and what they are trying to accomplish. Only by knowing this much about its customers can a firm really know what kinds of value will be truly appreciated.