Product-centric or customer-centric: Which approach is best for my business?

Product-centric or customer-centric: Which approach is best for my business?

 

Product-centric or customer-centric: which company are you in?

 

It's quite unfortunate that many business owners and marketers don't know what it means to be product-centric or customer-centric. This is clearly one of the reasons why many businesses suffer a setback.

 

 

 

That is, Product-centric focuses on developing the best products while Customer-centric believes in meeting customer needs. Although these two designs are full of opposing ideas, they are effective in their own way.

 

Knowing the difference between a product-centric and customer-centric business approach is great. However, if you want to stand out from your competition, you must seek to better understand how these two models apply to various businesses. You would never know which approach would be most sustainable for your business.

 

 

 

In this article, you will learn about the key differences between product centric and customer centric and their individual business models. The goal is to enable you to make a better decision regarding your Business model and design.

 

Product-centric model

 

“Customers don't know what they want until you show it to them” ~ Steve Jobs . This is a typical product-centric representation.

 

A product-centric organization is one that focuses on the products it brings to market as a means of measuring success and determining strategy rather than the customers who buy those products.

 

 

 

They seek to develop new products by taking advantage of technology or specialist skills that exist within the company,

 

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Customer-centric model

 

“We see our customers as guests at a party and we are the hosts. It's our job every day to make every important aspect of the customer experience a little better” ~ Jeff Bezos

 

The customer-centric business model starts with the customer. They work to meet customer needs. In fact, customers are at the heart of every business decision they make.

 

 

 

Have you also noticed that marketers are gradually adopting a customer-centric approach and taking into account what is important to their customers?

 

Let's see why.

 

Product-centric or customer-centric - what's the difference?

 

The table below shows a clear distinction between the product-centric business model and the customer-centric business model.

 

Product focused              Customer oriented

Create the best products            Create the best solution for the customer

Develop a new product               Develop a solution to problems

Reward people who develop new products      Reward people with great customer insights

Aligned with the industrial age Aligned with the experience economy

Pushes products to customers Have informed buyers

Both product-centric and customer-centric companies have the same goal of maximizing shareholder value, but the difference lies in how they intend to achieve their goal.

 

The product-centric approach gives management a clear structure and allows the team to easily identify its purpose.

 

 

 

Solo, the plastic cup company, is typically product-centric, as their products don't require much effort to purchase.

 

 

 

Individual customers are more concerned with the value of their purchase than building a business relationship with the brand.

 

Typically, product-driven companies achieve their goal through high volumes and lower costs. These companies have a lot of expertise in a certain technology or a certain field, which drives them to strive to increase their production and eventually dominate the market.

 

However, this could cause them to be less receptive to customer feedback, which is obviously problematic.

 

On the other hand, customer-centric companies rely on customer development, retention, and acquisition as a major strategy. They structure their processes around the future, segmentation and personalization.

 

Take a look at companies like Apple, Amazon, Zappos, and Southwest Airlines, and how their customer focus has helped them break into incredibly competitive and established industries. They keep creating a lot of new categories.

 

Product-centric or customer-centric, which is more sustainable?

 

Product-centric business approaches have their roots in the industrial age and are rapidly losing relevance in a new era where the customer is in control.

 

Likewise, customers are willing to provide Customer Reviews to companies that offer them a fair exchange of value.

 

 

 

It is the customer-centric business approach that delivers greater long-term value to the business.

 

Mainly because these approaches recognize the value of customer retention and advocacy. And they recognize that a company's value is reflected in the makeup of its customer base.

 

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Conclusion

 

Product orientation and customer orientation are approaches to business models. Both approaches are vital for any business growth. In fact, these two approaches ideally go hand in hand, but it's important to understand the difference to know how to run your business well.

 

Advice

 

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