Product-Centric vs. Customer-Centric Marketing

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Introduction

Stiff competition in the world has prompted many organizations to restructure their operations strategies. Kotler and Keller (2011) identify marketing management as a critical factor to the success of modern businesses. They define this concept as the planning, evaluation, execution, and control of a set of activities meant to facilitate the realization of corporate goals. In the past, most firms paid attention to product development and were concerned about their sales volume. The emergence of a consumer base that values experience has led to companies reevaluating their marketing strategies.

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Today, most businesses endeavor to know the interests of their target customers and work towards fulfilling them. Kotler and Keller (2011) outline two models of marketing techniques: customer-centric and product-centric. The authors allege that a product-centric marketing approach focuses on goods, and is concerned about the volume of commodities sold to clients. Conversely, a customer-centric strategy concentrates on satisfying the needs of individual consumers. This paper will compare these two methods of marketing and discuss their impacts on the positioning.

Comparisons

A major distinction between product-centric and customer-centric marketing approaches lies in the kind of questions that organizations and entrepreneurs ask when developing business plans. In the former technique, individuals consider the type of goods and services that they can sell to consumers. As per Marjanovic and Murthy (2015), a product-centric marketing system emphasizes the tangible assets of an organization. They include the number of industrial units, office buildings, and distribution channels among others. These resources are vital in assisting organizations to sell their products and services to as many customers as possible.

On the other hand, in a customer-centric marketing approach, investors value the interests of their target consumers. Eggers and McCabe (2016) argue that most entrepreneurs appreciate that contemporary buyers assess the nature of experience that they can get from a particular product or service before purchasing it. Today, the majority of customers do not fancy appealing promotional messages. Instead, they make buying decisions based on the value of goods and services. Organizations that leverage this marketing technique put a lot of emphasis on intangible assets, among them consumer feedback and loyalty.

The product-centric marketing method focuses on extending the reach of its goods and services. According to Marjanovic and Murthy (2015), self-promotion and lack of market segmentation are two major qualities that define this mode of promotion. The primary goal is to reach as many clients as possible; hence a business does not require dividing consumers into different groups. Instead, the marketing team strives to communicate the availability of a particular product to each and every potential customer. Companies that use a product-centric marketing approach do not have a distinct target audience (d’Avolio et al., 2015).

Therefore, they promote their products and services exclusively, hoping to draw the attention of as many customers as they can. Additionally, these organizations offer different varieties of products and services in an effort to make sure that they have the best and latest goods in the market. Mishra and Vishvas (2019) posit that businesses that practice product-centric marketing methods embrace the culture of self-promotion. They present themselves as superior with the objective of encouraging clients to prefer them to other companies.

The consumer-centric marketing approach seeks to provide solutions to problems ailing clients and pays attention to customer lifetime value. Eggers and McCabe (2016) maintain that institutions that use this promotional strategy conduct research to identify pressing consumer problems and needs. Besides, they divide their target market into discrete segments for ease of identification and to address consumer needs.

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A customer-centric business keeps on evolving its products and services to meet changing customer interests and preferences. Additionally, it manufactures products and tailors its services to the needs of individual clients. Unlike product-centric companies that produce multiple varieties of goods, consumer-centric firms improve their merchandise and services according to the needs of their target clients (d’Avolio et al., 2015).

These organizations value the contribution of individual consumers to their success. Consequently, they estimate the total income that they are likely to obtain from each customer and focus on those patrons that are most profitable. Additionally, these businesses use data on customer lifetime value to make judgments on the number of resources to spend in recruiting additional clients and maintaining existing ones.

Impacts on Positioning

A significant difference between product-centric and consumer-centric marketing lies in the way that the two strategies promote products and services. In the former method, organizations communicate to customers what they want them to hear. Companies that use product-centric marketing techniques create brand messages that depict their products or services as superior (Mishra & Vishvas, 2019).

They exhibit an outbound marketing outlook where brand promotional messages are broadcast on mass media with the hope of reaching as many customers as possible. On the other hand, businesses that use a consumer-centric approach appreciate that most adverts have an insignificant influence on clients. Many customers disregard messages that do not appeal to their existing problems, needs, wants, and sufferings (Eggers & McCabe, 2016).

Today, organizations that are consumer-centric use inspirational messages to promote their brands. For instance, Lululemon uses a blog dubbed ‘Up-Close + Personal’ to popularize its products to fitness-conscious customers. This platform features videos of the company’s sportswear that describe its fitness value. Additionally, it publishes promotional messages that outline the health values of its varied merchandise.

The Product-centric marketing approach sells products and services to target customers based on their qualities without paying much consideration to the value that they may add to clients. Marjanovic and Murthy (2015) cite the presentation of corsets in the 1900s as “shapewear” as one of the examples of product-centric positioning. Corsets were displayed as body-hugging apparel that assisted in “reducing women’s abdomen”.

Such positioning disregarded the desires and feelings of most customers. Not all women are concerned about hiding their bellies, with many preferring to purchase clothes that make them feel comfortable. In the past, watch-manufacturing companies leveraged product-centric techniques to position their brands. The organizations ran promotions that highlighted the functional qualities of their products. For instance, the Accutron ad outlined the innovation included in a watch without mentioning the kind of people that could benefit from the device.

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Today, many companies have realized that emotions and desires play a significant role in consumer buying behavior. Consequently, they ensure that their positioning strategies put into consideration the feelings of potential clients. Modern promotions, especially in the apparel industry do not focus on the features of a product. Instead, they concentrate on the benefits that customers can get from using the merchandise. Today, body-hugging clothes are no longer positioned as shapewear. Instead, companies market these garments by highlighting their physical and health benefits.

Apple Company is one of the businesses that leverage consumer-centric marketing to position their products such as watches (d’Avolio et al., 2015). Despite this corporation using state-of-the-art technology to manufacture watches, its advertisements do not feature the innovations incorporated in these devices. This company acknowledges that most customers know that Apple products are of high quality, hence there is no need of regurgitating the same in its promotions. Consequently, its adverts outline the health benefits and convenience that clients can derive from using its smartwatches. Sports apparel companies also exploit consumer-centric marketing in positioning their products. For instance, the promotion of athleisure focuses more on the comfort of athletes than on fashion.

Conclusion

In the past, most businesses used a product-centric approach to marketing their products. The majority of the organizations valued their physical assets like factories and distribution networks and disregarded the value that their products or services added to consumers. Changes in consumer buying behavior have led to organizations reviewing their marketing strategies. Currently, many businesses use consumer-centric methods to market their goods and services.

Organizations acknowledge that clients evaluate products and services according to their value. Additionally, they evaluate the lifetime value of their existing and potential customers to determine their worth. Product-centric and Consumer-centric marketing influence how businesses position their brands. An organization that is product-centric uses adverts that stress the features of its goods and services. They do little to convey messages that appeal to consumers’ desires and emotions. Such organizations demonstrate outbound marketing attitudes and endeavor to ensure that promotional messages reach as many people as possible.

Businesses that embrace consumer-centric methods use advertisements that appeal to the emotions, problems, pain, and needs of clients. They position their brands as ones that are best capable of satisfying these concerns. These businesses demonstrate inbound marketing outlooks and organize their brand messages in line with what their clients want to know or hear.

References

d’Avolio, E., Bandinelli, R., & Rinaldi, R. (2015). Improving new product development in the fashion industry through product lifecycle management. A descriptive analysis. International Journal of Fashion Design, Technology and Education, 8(2), 108-121.

Eggers, F., & McCabe, D. B. (2016). Trial-and-error marketing: The role of the customer in tech start-ups. International Journal of Technology Marketing, 11(2), 17-33.

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Kotler, P., & Keller, K. L. (2011). Marketing Management (14th ed.). Prentice Hall.

Marjanovic, O., & Murthy, V. (2015). From product-centric to consumer-centric services in a financial institution – Exploring the organizational challenges of the transitional process. Information Systems Frontiers, 18(1), 479-497.

Mishra, A., & Vishvas, R. (2019). Retail shopper empowerment: A consumer-centric measure for store performance. IIMB Management Review, 31(1), 20-36.

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BusinessEssay. (2022, January 11). Product-Centric vs. Customer-Centric Marketing. Retrieved from https://business-essay.com/product-centric-vs-customer-centric-marketing/

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BusinessEssay. (2022) 'Product-Centric vs. Customer-Centric Marketing'. 11 January.

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BusinessEssay. 2022. "Product-Centric vs. Customer-Centric Marketing." January 11, 2022. https://business-essay.com/product-centric-vs-customer-centric-marketing/.

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BusinessEssay. "Product-Centric vs. Customer-Centric Marketing." January 11, 2022. https://business-essay.com/product-centric-vs-customer-centric-marketing/.