module 2.6 customer centricity the radical shfit from selling prodcuts to growing customers

Customer centricity The radical shift from selling products to growing customer

Core concept:-

• Most companies think :- How do we get more customers for our products?

• Customer centric company think:- How can we create more value for the right customers over time?

This sounds like a small difference, but it completely changes. How a company operates

The biggest misconception

Many people believe customer centricity means:-

• Being nice to customers

• Providing good services

• Responding quickly to complaints

Those things matter, but they are not customer centricity

True customer centricity

Customer centricity means :-

• identifying which customers create the most long-term value

• Understanding their needs deeply

• Making decision that maximise the future value

• Building long-term trust and relationships

Difference between product centric and customer centric

Product centric:-

1. Focus on products

2. Sell more units

3. Short-term revenue

4. Broad targeting

5. Product Profitability

Customer centric

1. Focus on customer

2. Increase customer value

3. Long-term relationship

4. Selective targeting

5. Customer profitability

Key insight:-not every customers is equally valuable

A customer centric company, accepts his and allocate resources according

Most radical idea in the lecture:-

Customer select

• Traditional thinking, says:- More customers= Better

• Customer centric thinking, says:- Better customers=Better

This doesn’t mean, ignoring people

It means recognising that some customer:-

1. By repeatedly

2. Stay longer

3. Trust the company more

4. Refer others

5. Cost less to serve

These customers deserve greater attention

Example :- Enterprise rent A car

ManyCar rental company focused on

Fleet size

Location

Pricing

Enterprise focus heavily on :-

Customer satisfaction

Repeat business

Relationship Quality

Managers were evaluated, partly on customer satisfaction scores

Lesson:-Enterprise Realised that satisfied Customer generate future revenue

The focus shifted from transaction to relationship

Why customer centricity feels uncomfortable?

Many traditional businesses reward

• Monthly sales

• Quarterly profits

• Immediate results

Customer, electricity often Requires

1. Patiences

2. Investment

3. Trust building

Pay off may come months or years later

The trusted advisor, principle

Sometimes the best decision for the customers is not most profitable decision today

Example:-Financial Advisory

Imagine to advisers

• Advisor A:-Recommends the product with the highest commission

• Advisor B:-Recommends the product that genuinely fits the clients needs

Advisor B may earn less today

But over time

• trust income

• Referrals increase

• Retention increase

Marketing lesson :- Trust is often more valuable than a single sale

Customer lifetime value(CLV) Hidden metric

Customer centric companies don’t ask:-how much did we earn from this customer today?

They ask :- How much value will this customer generate over the next five years?

This change the decision making

Example :- two customers

Customer A

• Makes one large purchase

• Never returns

Customer B

• makes smaller purchases

• Returns consistently for years

Many customer centric companies customer prefer customer B

Why data became so important?

Customer electricity is impossible without customer knowledge

Companies need data to answer:-

• Who are our best customers?

• Who is likely to leave?

• Who is becoming more valuable?

• What do customers need next

Important

The goal of the data is not reporting

The goal of the data is Prediction

Forward looking thinking :-

Traditional companies often look backward

Questions:-

• What sold last month ?

• What happened last quarter ?

Customer centric companies look forward:-

Questions:-

• Which customers will become valuable?

• Which relationship should be invest in next?

• What features need Can we anticipate?

What marketer should learn?

The most important shift is this

Old marketing questions:-How do we persuade people to buy?

New marketing questions:-How do we create enough value that customers want to stay?

This is the foundation of modern loyalty program, CRM system, subscriptions, and relationship market

Mental model

Think of customers, centricity like Investing

Product centric company:-Looks For immediate returns

Customer centric company :-Build an asset

That asset is :-Trusted relationship with valuable customers

And likely any good investment, it becomes more valuable over time

Key takeaways

Strategic lesson:-Customer centricity is not about maximising sales, it about maximising customer value

Business lesson:-The most profitable customers are often not the customers who spend the most today, but those who stayed the longest

Marketing lesson:-Trust and retention are the often stronger competitive advantage than products

Customer centricity means identifying the right customers investing in long-term relationship relationships and making decision based on future customer value rather than immediate sales