Customer centricity as a driver of successful customer relationships
Perceived customer centricity is the key prerequisite for successful customer relationships and thus – according to Prof. Dominik Georgi, Prof. Jan-Erik Baars and Luc Holzach – a stronger driver than (for example) customer satisfaction. The following summarizes the most important points from the article of the same name that appeared in Marketing Review St. Gallen (MRSG).
Customer centricity is the first element in the customer success chain, leading via customer experience and customer enthusiasm to customer loyalty, and thereby financial customer value for companies.
Customer centricity is a standalone management parameter which complements other customer-related parameters such as customer satisfaction; it denotes a company’s ability to gear all of its activities toward customer requirements.
If one is to create customer centricity within a company, the starting point is to measure its current extent: the views of employees produce the Customer Centricity Score (CC-Score), while the views of customers give rise to the Customer Impact Score (CI-Score).
The Customer Impact Score measures how customers perceive a product/service, i.e. the level of customer centricity, and this is closely related to customer value.
In their article in MRSG, Georgi, Baars and Holzach outline the concept that underlies measurement of the Customer Impact Score as well as empirical findings relating to how customer centricity impacts downstream variables. In doing so, it becomes apparent that customer centricity is a significant driver of customer loyalty and thus a significant driver of successful customer relationships.
The impact of customer centricity is much stronger than that of customer satisfaction in particular. This is confirmed by the following findings:
- Customer centricity is a leading indicator, whereas customer satisfaction is a lagging indicator.
- Customer centricity refers to a company’s capabilities, whereas customer satisfaction is derived from what it actually provides.
- Thus a focus on customer centricity is future-oriented, whereas customer satisfaction focuses on what has already occurred.
Measuring customer centricity is only a starting point, yet it is undoubtedly a way for companies to set out on their journey toward greater customer centricity. By using a 360 degree perspective, it shows companies the levers they can deploy to make their organization more customer-centric.
Read the full-length article on LinkedIn.
