Customer Centricity

More than ever, customer centricity helps businesses acquire and retain customers. This boosts sales, lowers costs and drives up profitability. Deloitte estimates that customer-centric companies are 60% more profitable than those that are not. Indeed, according to a recent IMA survey, 57% of businesses will focus heavily on customer centricity this year. Digitalisation, together with shifting tastes and preferences, means that companies must incorporate consumer viewpoints, intentions and values into how they define and market their brand. This paper summarises some of the new ‘rules of the game’ around customer centricity that companies might seek to emulate.

Key Tenets Of Customer Centricity

Research your customer

Increasingly, staying ahead of the game requires in-depth research on customers and the continuous monitoring and distilling of feedback. The Tata Group has established the Tata Business Excellence Group (TBExG) as an in-house advisor and knowledge partner. TBExG helps Group companies develop and sharpen their customer-centricity and to deliver greater value to their customers. It collaborates with knowledge partners and conducts diagnostic studies for both B2B and B2C companies.

Where possible, go ultra-niche

For customers looking for a highly specific service or a product, expertise can be more valuable than the size or name of the brand. Niche companies build brand loyalty by providing customers with exactly what they seek. One in every five women in India suffers from PCOD, a metabolic disorder. To keep this lifelong condition in check, Veera Health, a digital clinic, has developed a holistic PCOD management plan, providing telehealth solutions in areas of reproductive, mental and physical health. To date, it has treated over 50,000 women, with an 85% success rate.

Leverage data analytics

Digital channels make it easier to capture and standardise data, which in turn can improve the overall customer experience. In 2017, HP decided to put data at the heart of its marketing strategy. Initially, 98% of all customer data lay with individual HP agencies and HP often had no access to the full database. Centralising its data and analytics across multiple customer segments using tools from adobe, HP enabled greater transparency and insight into customer behaviour. This helped it personalise the end-to-end customer journey, both on- and offline. Today, about 26% of all the ad impressions HP serves are based on this data.

Visualise your customers digitally

Few industries embody the sheer potential of digital – with its ability to hyper-personalise customer interaction – better than the BFSI sector. HDFC Life Insurance has adopted several robotics-based platform functions to provide instant, round-the-clock services. Elle, a chatbot powered by AI and neurolinguistic programming, handles nearly 35,000 client queries a month. Neo, its Twitter bot, allows customers to access information on their policies via chat. Additionally, HDFC Life’s customer-service representatives are equipped with a mobile app that allows them to assist customers to upload their documents electronically, saving them time and effort. Finally, for customers who prefer to communicate via email, the company’s ‘SPOK’ email bot manages thousands of emails each month, enabling faster and more reliable response than possible with manual systems.

Aditya Birla Health Insurance Company Limited (ABHICL) has gone even further, leveraging technology to transform a traditionally ‘sell and forget’ business model to one defined by ‘buy and engage’. Its robust digital platform enables seamless and cost-effective access to the broader health ecosystem. ABHICL was the first insurer in India to introduce face scans and real-time tracking of health parameters and users’ activity and lifestyles. This data feeds directly into premium calculations, and even enables cash-backs to those meeting specific lifestyle criteria. This hyper-personalisation has enabled the brand’s rapid penetration.

Leverage partnerships

RBL is a young bank, but in 2014, it inherited a small (~30,000 accounts) credit card business from RBS. At the time, digital platforms like Amazon, BookMyShow and Paytm were seeing explosive growth. RBL decided to combine its own capabilities around card issuance – which involve processing, underwriting and customer engagement – with the sheer scale of these platforms. It partnered with BookMyShow to develop a co-branded card catering to a specific segment of the population – one that regularly attends the cinema, music concerts, and sports and other live events. This micro-segmentation of the broader market has helped RBL quickly emerge as a leading card issuer.

Build a personalised user experience

Increasingly, customers prefer personalised and tailor-made e-Commerce interactions. Products can quickly seem ‘old’ if they fail to offer a ‘different’ or ‘more engaging’ experience. Spotify, a leading music streaming app, stays ahead of the pack by actively leveraging user data to improve recommendations, playlists, and to make personalised offers. It curates ‘Discover Weekly’ playlists for each user on the basis of what they have listened to recently. It also enables users to create public playlists, follow and listen to the curated playlists of other users, and even – in a feature distinct to Spotify – to engage with communities of like-minded users. Finally, Spotify engages closely with other brands, including Uber (users can listen to their own Spotify playlists while riding in an Uber) and Sony (enabling users to directly link their Spotify accounts to the huge Playstation network). The Sony partnership, in particular, has helped Spotify vastly expand its market.

Re-platform when necessary

Nike’s ‘Triple Double Strategy’ (2x Innovation, 2x Speed and 2x Direct Connections with Consumers) framework helped it realise that, at least in the United States market, it could generate better margins from its digital channel than from physical stores. Starting around 2017, it began a strategic ‘re-platforming’, Nike reducing its retail partner base from 30,000 to just 40 strategic partners. Nike exited several wholesale relationships, including ones with Zappos, Belk and Fred Meyer. Concurrently, it built up its direct online channel, which is strongly preferred by younger customers for the convenience and personalisation it offers.

Segment and micro-segment

Travel aggregator MakeMyTrip (MMT) serves millions of customers each day and a one-size-fits-all approach could only take it so far. In the last few years, however, strong segmentation has enabled MMT to hyper-personalise the user experience, powering its own growth. It now segregates users into different bucket, each with its own needs: flight booking, hotel booking, holiday destination search, upcoming booking, etc. It displays a specific layout on its website/app for each of these bucket, with various alternatives presented. At the back end, MMT has built a real-time personalisation system that is able to respond to a query within just 500 milliseconds. This is done by leveraging multiple technologies, including robust processing engines. 80-85% of users find relevant hotel choices in a few clicks, up from 60-65% previously. This has resulted in better conversions. MMT has also introduced a travel fintech feature (TripMoney) that helps cross-sell and up-sell products like bite-sized insurance and forex cards.