A key challenge facing companies today is moving from a product-centric focus to a customer-centric one.

Starbucks and Apple stocks have been trading at record highs, but are these and other businesses doing everything they can to ensure growth over the long term?

Peter Fader, Wharton marketing professor and co-director of The Wharton Customer Analytics Initiative, argues that too many companies are customer friendly, but not customer centric.

In other words, they treat each customer the same, missing an opportunity to discover who their best customers are. Without that data, they cannot make their most valuable customers even more profitable to the firm.

In his new book, Customer Centricity, part of the  Executive Education Essentials Series, Fader describes what customer centricity is, what it isn’t and why it matters. He also demystifies customer relationship management and emphasizes the importance of gathering customer data in meaningful ways.

Many companies have made significant investments to enhance their customer experience capabilities.

However, these investments haven’t always delivered expected results.


According to BP Group research, most companies are using an outdated customer model that doesn’t account for how the world is quickly evolving and how this has impacted customer behaviour. Companies also are investing in customer centricity initiatives without understanding who their customers are and their real needs.

Traditional, outdated methods urge us to standardise processes as if a customer was a part on a production line, whereas to be truly customer centric we need to do the opposite and treat customers as the individuals that they are and customise their experiences. This is easier to do that you might think.

89%of companies expect to compete mostly on the basis of customer experience.

87% of buyers will pay more for a better customer experience.

Customer centricity has never been more important. 

According to Yücel Ersöz, a partner at Peppers & Rogers Group, in today’s complex selling environment, many organizations have come to realize that relying on new product features is not enough to attract more customers. Many are discovering that they need to organize internally around their customers.
Organizing Sales Teams Around the Customer
This involves creating new avenues of sustained growth, which hinges on evolving the sales strategy, by adopting a targeted customer segmentation approach that aligns sales with customer segments, to better assess customers’ potential value and identify ways to realize this value.

Different buying processes and decision mechanisms of buyers necessitate different sales services to different customers.

When organizing a sales force, there are five approaches:
1. Generalistic: With this approach, each sales representative sells the entire product range to all customers in each defined territory. This strategy works best when companies have few unsophisticated products, very similar customers with simply buying processes, and when efficiency matters.

2. Market based: Organizations are segmented by geography, sector, account size, or customer needs and each segment is served by a different group within the sales organization. Depending on customers’ buying process, the team may include one or more people. This approach works best when there are different customer segments and a complex buying process, when customer knowledge makes an important difference, and when efficiency doesn’t bring effectiveness.

3. Product based: Sales teams are assigned to product or product groups. This works best when the company sells broad, sophisticated, and diverse products and product knowledge is of the utmost importance.

4. Activity based: In this approach, sales teams are organized around the sales process. A specialist team performs different sets of tasks, and accounts are set up according to acquisition versus account maintenance. This works best when there are complex activities in the selling process that require special knowledge and when the tasks within the sales process require different skill sets.

5. Hybrid: This organizational structure could be any meaningful combination of other structures.

As with establishing any new strategy, due diligence is required.

“Can effectiveness be improved if we have product specialists?”
“Would we have segments with meaningful sizes to warrant specialist teams?”
“Would a generalist team avoid certain critical tasks?”
After asking these vital questions, choose the dimensions that create the greatest variation in the selling process, and build your strategy around which approach you take to organization your sales team.

According to Yücel Ersöz, a partner at Peppers & Rogers Group, executives should also be thinking about growing their businesses through customer-centricity.

A customer-centric strategy setting is a more balanced approach driving greater loyalty and consistent revenue growth.

In addition, a customer-centric approach will help companies to foster gains in customer lifetime value and customer profitability.

Watch From Product-Centric to Customer-Centric Management >

Taught by three of Wharton’s top faculty in the marketing department, consistently ranked as the #1 marketing department in the world, this course covers three core topics in customer loyalty: branding, customer centricity, and practical, go-to-market strategies. You’ll learn key principles in:

– Branding: brand equity is one of the key elements of keeping customers in a dynamic world in which new startups are emerging constantly.

– Customer centricity: not synonymous with customer service, customer centricity starts with customer focus and need-gathering.

– Go-to-market strategies: understand the drivers that influence customers and see how these are implemented prior to making an investment.