Free Subscription

  • Access daily briefings and unlimited news articles


Only $39.95 per year
  • Quarterly magazine and digital
  • Indepth executive interviews
  • Unlimited news and insights
  • Expert opinion and analysis

Why customer centricity matters

11936aeIn an age where customers have more choice and more power than ever before, adopting customer centricity as a default mindset is integral for survival for Australian retailers, according to Dr Violet Lazarevic, senior research consultant at the ACRS, Monash Business School.

Inside Retail, our sister publicationdiscussed customer centricity with Lazarevic ahead of the inaugural Retail Customer Excellence Awards. Lazarevic is on the panel of judges who will review the award entries this week.

Inside Retail: What is customer centricity?

Violet Lazarevic: Customer centricity is a different mindset that today’s businesses need to adopt. This mindset involves putting the customer at the heart of all business decisions within the organisations. Organisations are so used to creating their own way of doing things that often they become removed from the customer and what the customer wants. Adopting this type of mindset allows organisations to transform their business in ways that makes the customer experience more enjoyable and easier for the customer.

IR: Why is customer centricity important?

Lazarevic: In today’s retail environment customers have more choice than ever before. If they don’t like the retailers operating in Australia, they can access a multitude of overseas retailers online. This has given the power back to customers and has made their expectations around the retail experience higher than ever. If retailers don’t adopt a customer centric approach, if they stubbornly hang on to the way that they have always done things, customers will go elsewhere to fulfil their needs. And if they get really upset with you, they will do more than just leave, they will tell everyone through their wide array of social networks. Retailers need to keep their fingers on the pulse of what is happening with customers to ensure their survival.

IR: Which retailers implement customer centricity successfully in today’s omnichannel environment?

Lazarevic: I don’t believe that anyone is getting this 100 per cent right in today’s retail environment. But there are retailers who are making great strides. For example, Nordstrom in the US have implemented NM service, which gives their high-end customers an opportunity to use their smartphones to make appointments with an NM associate to assist them and then facilitate their shopping experience through the app and with the use of customer data collected by Nordstrom.

Target here in Australia have also done interesting things with app technology. Their research has indicated that their customers wanted shoppable inspiration as well as access to product information all in the one place. The Target app provides inspiration to customers to spark their creativity in creating looks but also provides a price scanner function that can be used in store to provide pricing and product information.

These approaches reveal some critical skills about customer centricity. The first is understanding your customer and the effort to understand the customer cannot become static. The customer is constantly evolving, therefore the efforts to understand your customer need to be dynamic and ongoing. The second critical skill is designing a culture around putting the customer first. The entire organisation needs to be concerned with the customer, otherwise it’s impossible to design processes and behaviour within the organisation that will deliver what customers are looking for.

IR: Do Australian retailers take enough heed of retail development and innovation overseas?

Lazarevic: Some Australian retailers do a brilliant job of this through international partnerships, study tours, attending world events such as the World Retail Congress, etc. However, with the increasing speed of innovation and increasing amounts of information available, it is impossible for retailers to stay on top of everything applicable to their business. This is where partnering with an organisation, which curates knowledge and information, can be very useful. It’s important that Australian retailers learn from what the best retailers in the world are doing to avoid being left behind.

IR: What important trends in retail technology do retailers need to be taking notice of?
Lazarevic: App technology is something retailers definitely need to take notice of. It is a low cost way to engage with customers through a device they already own. It’s also a great way to collect customer data that can be used to be more customer centric and improve the retail offering. Empowering employees through the use of technology in store is also really important. ACRS’s 2015 Retail Thought Leadership Study on service design revealed that employees often feel that they are not given the tools to provide the best service possible to customers. This can be as simple as a smartphone or a tablet provided for employees so that they can look information up and enrich the customer’s service experience.

You have 3 free articles.