CUSTOMER CENTRALITY

Customer Centrality

Table of Content

Part A: Literature Review1

Introduction1

Discussion1

Customer-Centric Philosophy Value Proposition and Core Ideology2

Customer Loyalty12

Customer Value Management15

Conclusion15

Part B: Practical Experience18

Introduction18

Discussion18

Conclusion20

References22

Customer Centrality

Part A: Literature Review

Introduction

The roots of customer centricity can be traced all the way back to the late 1960s, when a relatively obscure ad agency executive by the name of Lester Wunderman gave birth to the idea that we know today as direct marketing. Many of the concepts you'll read about in this book, including the basic overarching notion that businesses would be well served to know absolutely everything about their best customers, are derived in some way from the ideas of Wunderman, who understood long before anyone else the value of keeping records (frighteningly detailed records, actually) about customer buying habits. In this chapter, I have conducted a review of the academic and institutional literature for relevant key concepts and related research. For the purpose of this research paper, I have focused on the characteristics of a customer-centric organisation.

Discussion

Companies that will enjoy the most success in the years and decades to come will be the companies that dedicate the resources necessary to not only understand their most loyal and committed customers, but also make the effort to then serve these valuable customers-and serve them in a way that will not only make them feel special but also maximize their value to the company. A retailer like Sears would treat the individuals that buy products from its various stores as the unit of analysis. An IT vendor like IBM would have its divisions interacting with its retailers or resellers on one hand and with direct institutional customers on the other. Here, retailers and direct institutional customers are both independent units of analyses. Thus, while the definition of the customer could vary, the customer concept would be widely applicable across various types of markets.

Customer-Centric Philosophy Value Proposition and Core Ideology

In order to effectively critique the literature, it is important to clarify and understand why organizations are focusing on enhancing their customer support. As the organisations grow, the senior leadership team realizes that they must articulate a specific focus that drives both their internal processes and behaviours as well as defines what their reputation is in the marketplace. This focus might best be described as their value proposition; Treacy and Wiersema (1995) have articulated that a value proposition is "the implicit promise a company makes to its customers to deliver a particular combination of values". Treacy and Wiersema contended that there are really only three main value disciplines from which a company should choose in order to fulfill their value proposition. These disciplines have been identified as operational excellence, product leadership, and customer intimacy. "Choosing one discipline to master does not mean that a company abandons the other two, only that it picks a dimension of value on which to stake its market reputation" (Treacy & Wiersema 1995, p. 40).

An organisation's primary goal is to enhance the customer experience at every point of ...