How to Leverage a Customer-Centric Growth Strategy (2024)

While it can be tempting to ignore customer feedback, acting on it can be a sustainable growth strategy. Satisfied customers are loyal customers, and loyal customers become your best advocates. It is more expensive to acquire a new customer than to sell to an existing customer – five to 25 times more expensive.

In customer-oriented growth, customer satisfaction is the priority. By incorporating your customers’ perspectives into every area of ​​your business, you’ll build better products, keep your current customers happy, and reach new customers through advocacy.

What is customer-centric growth?

Customer-Led Growth (CLG) focuses a company’s growth efforts on its customer base. By prioritizing customer feedback and continually exceeding expectations, companies can increase customer retention, increase sales, and advocate. With this approach, customer recommendations become one of the most important sales drivers alongside classic marketing.

Luggage company Monos, for example, follows a customer-centric strategy. One way this happens is that customers receive points for purchases and referrals that can be redeemed for discounts. The company has generated $8 million in revenue by focusing on customer loyalty and advocacy.

Customer-centric growth requires close cross-functional collaboration. Customer success teams are the foundation for decision-making, but all departments – from product development to sales – must work together to align marketing messages.

Customer-centric growth vs. product-centric growth vs. revenue-centric growth

Companies typically employ one of three main growth methods, depending on the type of product they have and the level of support they need during their buying process.

Product-led growth

In a product-led growth (PLG) model, a company focuses on the product itself to increase sales and engagement. Product development, sales, marketing, and customer success teams focus on developing and driving product features—and leveraging them to acquire and retain customers.

PLG strategies often include offering free trials so users can try before purchasing. Likewise, the freemium model is a popular PLG tactic: customers try a free version with limited features and upgrade to the paid version once they are comfortable using the product and understand the value it offers.

Sales-oriented growth

Sales-Led Growth (SLG) is a growth strategy that focuses on acquiring new customers. In a sales-focused growth company, a customer success team tends to take a back seat to sales and marketing teams. Sales-led growth emphasizes closing deals quickly using traditional advertising and personal selling techniques.

Sales-focused growth techniques are particularly helpful when the product is complex or requires a high level of personal touch. For example, customers may browse a catalog when researching industrial equipment, but they typically need to have a conversation with a salesperson to close the deal.

Customer-focused growth

Customer-centric growth relies on customer advocacy and loyalty to drive revenue growth. It differs from product and sales-focused strategies because it uses customer insights to drive sales – often with great results. According to a 2021 Forrester report, customer-centric growth companies grow 2.5x faster than the alternatives and also retain 2.2x more customers per year.

The goal is to build customer interests. This increase in advocacy helps reduce acquisition costs, including advertising spend. This strategy’s focus on customer insights – often referred to as the “Voice of the Customer” (VoC) – has downstream benefits beyond advocacy, such as improved product development.

How to start with a customer-centric growth strategy

1. Collect customer feedback
2. Build a customer-centric culture
3. Get personal
4. Reward your customers’ loyalty and commitment
5. Establish your measurement framework

Here are five steps to develop a customer-centric growth strategy that increases revenue through customer retention, expansion and advocacy.

1. Collect customer feedback

Customer feedback is the cornerstone of the customer-centric growth framework. A solid VoC program collects data through surveys, feedback forms, purchase data, support emails, and social media conversations. It distills this data into actionable, growth-oriented insights.

There are three main audiences you need to focus on gathering feedback from:

• New customers. Your freshest customers can tell you why they chose your product and how they felt about the experience.
• High-value customers. To find more buyers like them, it’s important to understand the customers who come back and recommend you.
• Churned customers. There is a lesson to be learned here. Find out why people leave and how you can prevent it from happening in the future.

Remember to close the customer feedback loop by following up and showing gratitude, whether you implement your customers’ ideas or not. For example, if you adopt their idea, let them know. If not, thank them for their contribution. Regardless, a follow-up email with a promo code can make customers feel valued and encourage them to make a purchase.

You can also use this feedback to create powerful social proof content like testimonials and case studies to support sales efforts.

2. Build a customer-centric culture

Simply collecting customer feedback is not enough. To build a customer-centric company culture, share customer feedback, good or bad, with relevant teams and key stakeholders and use it to guide improvements, messaging and support strategies. Of course, you can’t change your tactics based on every single review, but it’s important to create channels to communicate common customer needs and concerns to the relevant departments.

3. Get personal

Personalization is the key to e-commerce and customer-centric growth. Use customer data to personalize their experiences and communications. Create targeted messages and offers that upsell based on known buying patterns. For example, if you know that it takes an average of three months to use up a bottle of moisturizer, send a refill reminder 70 days after the initial purchase.

4. Reward commitment to customer loyalty

In a customer-centric growth framework, loyal customers are the key to sales. If they put their names on the line to advocate for your brand, show your appreciation accordingly. Recommendations play a major role in people deciding to make a purchase.

Encourage recommendations, reviews and user-generated content that can be used as marketing materials. When your customers speak for you with user-generated content and other forms of social proof, the message resonates better with potential customers.

Make it worthwhile to take time out of your busy day to speak on your behalf. You can offer rewards such as discounts on future purchases or subscription renewals, exclusive access to customer review events and samples, or early access to new products.

5. Establish your measurement framework

There is no universal standard for measuring customer-focused growth success. However, there are key performance indicators (KPIs) that signal positive results.

Customer-centric growth boils down to retention, expansion and advocacy. So these are the indicators you need to keep an eye on. This includes:

Endorsement can be harder to measure, but you can track referral rates with a formal referral program and assess how customers are talking about your brand with social listening tools.