The Business Case for Customer Centricity
This Brief argues that generating greater value for customers is good for business. Research from a developed market context has found that customer retention leads to a decrease in operating costs, while a decrease in customer satisfaction leads to a decrease in return on investment. In light of this, focusing on customers is crucial and not simply a marketing gimmick.
There are several compelling reasons that can motivate financial service providers (FSPs) to implement a customer-centric initiative, or even go further to implement a comprehensive customer-centric strategy. The following five business objectives generally motivate firms to explore and invest in greater customer centricity:
- Increase customer uptake and use;
- Improve market position in a competitive environment;
- Use technology to tailor products to specific customer segments while driving down costs;
- Respond to regulatory requirements on consumer protection;
- Achieve social impact to fulfill its mission.
The decision-making model in this Brief aims to help firms align their investment decisions with their motivations for customer centricity.
