Brain Centric Marketing: The evolution of Customer Centric for a new marketing
Posted: Mon Dec 23, 2024 10:06 am
Customer Centric " is a concept derived from the one introduced in 2011 by P. Fader in his book "Customer Centricity, Focus on the Right Customers for Strategic Advantage", and popularized by M. Zwilling in Forbes magazine that same year. For Fader, with the practice of "customer centricity", in addition to offering excellent products and services, a company must develop a specific strategy that relates the offer of solutions with the needs of its most valuable customers. This implies not setting short-term objectives but maximizing medium/long-term benefits through the planning of commercial actions defined on the basis of in-depth knowledge of the customer.
In reality, this concept is not new. It is an evolution of what was "Relational Marketing" and CRM (Customer Relationship Management) models, which are indebted to the direct marketing systems devised by L. Wunderman half a century ago. Since then, we have moved from customer selection, personalization of messages and systematic recording of responses and consumer habits to the reorganization of the company's structure and its design, production and distribution processes to create products tailored to the group of customers most valued by the company.
This implies, as Zwilling pointed out, recognising and accepting all is malaysian telegram that not all customers are the same, neither in terms of their consumer profile nor in the value they bring to the company. Therefore, knowledge of their real needs and expectations, on the one hand, and the profit margin with which they can contribute, on the other, are two elements that guarantee an important competitive advantage when it comes to obtaining a relevant position in the market.
The company's ability to quantify the cost of acquiring and maintaining its customers allows it to set the price margins it is willing to manage in order to obtain greater loyalty in the future. Margins that include everything from production costs to sales costs in an environment where the main factor is the personalization of the offer and direct and exclusive management with the customer.
Fader uses companies like Amazon, Wells Fargo, Harrah’s, IBM, Tesco, etc. as an example to show that, although the idea of being customer-centric is already a few decades old, they are actually the exception in a market where strategic decisions are not made based on the learning obtained after each launch of personalized commercial initiatives, but to justify an approach focused on the product and its attributes. Something that has long been used to calculate the customer lifetime value (or Customer Lifetime Value, CLV) in economic terms but not in terms of level of loyalty or commitment.
In reality, this concept is not new. It is an evolution of what was "Relational Marketing" and CRM (Customer Relationship Management) models, which are indebted to the direct marketing systems devised by L. Wunderman half a century ago. Since then, we have moved from customer selection, personalization of messages and systematic recording of responses and consumer habits to the reorganization of the company's structure and its design, production and distribution processes to create products tailored to the group of customers most valued by the company.
This implies, as Zwilling pointed out, recognising and accepting all is malaysian telegram that not all customers are the same, neither in terms of their consumer profile nor in the value they bring to the company. Therefore, knowledge of their real needs and expectations, on the one hand, and the profit margin with which they can contribute, on the other, are two elements that guarantee an important competitive advantage when it comes to obtaining a relevant position in the market.
The company's ability to quantify the cost of acquiring and maintaining its customers allows it to set the price margins it is willing to manage in order to obtain greater loyalty in the future. Margins that include everything from production costs to sales costs in an environment where the main factor is the personalization of the offer and direct and exclusive management with the customer.
Fader uses companies like Amazon, Wells Fargo, Harrah’s, IBM, Tesco, etc. as an example to show that, although the idea of being customer-centric is already a few decades old, they are actually the exception in a market where strategic decisions are not made based on the learning obtained after each launch of personalized commercial initiatives, but to justify an approach focused on the product and its attributes. Something that has long been used to calculate the customer lifetime value (or Customer Lifetime Value, CLV) in economic terms but not in terms of level of loyalty or commitment.