Product-Centric vs Customer-Centric: Which Approach is Best for My Business?

Product centric vs Customer centric: What business are you in?

Unfortunately, many business owners and marketers don’t know what product- or customer-centric means being. This is one of the reasons many businesses suffer a setback.

Here, Product-centric focuses on developing the best products, while Customer-centric focuses on satisfying customer needs. Although these two designs are full of opposing ideas, they are effective in their ways.

Knowing the difference between a product-centric and Customer-centric business approach is excellent. However, if you want to stand apart from your competitors, you must seek a clearer understanding of how these two models apply to various businesses. You’d never know which approach would be more sustainable for your business.

In this article, you’ll discover the significant differences between product-centric and Customer-centric, as well as their business models. The aim is to enable you to decide better about your business model and design.

Product Centric Model

“Customers don’t know what they want until you show it to them” ~ Steve Jobs. This is a typical product-centric representation.

A product-centric organization focuses on the products it brings to the market to measure success and determine strategy rather than the customers that buy those products.

They look to develop new products by leveraging technology or specialized skills that exist within the company,

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Customer Centric Model

“We see our customers as guests to a party, and we are the hosts. It’s our daily job to make every important aspect of the customer experience a little better” ~ Jeff Bezos.

Customer-centric company model starts with the Customer. They work to meet the needs of customers. Customers are at the core of every business decision they make.

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Have you, too, noticed that marketers are gradually adopting a customer-centric approach and taking into account what is important to their customers?

Let’s see the reason for that.

Product Centric Versus Customer Centric – What is the Difference?

The table below shows a clear distinction between product-centric and customer-centric business models.

Create the best productsCreate the best solution for the customer
Develop new productDevelop a solution to problems
Reward people that develop new productsReward people with great insights into customers
Aligned with the industrial eraAligned with the experience economy
Pushes products unto the customersHave informed buyers

Product-centric companies and customer-centric customers have the same goal of maximizing their shareholders’ value, but the difference lies in how they intend to achieve their goal.

Product-centric approach gives management a clear structure and makes it easy for the team to identify their focus.

Solo, the plastic cup company, is typical product-centric because their products don’t require much effort to purchase.

Solo customers are more concerned with the value of their purchase rather than building a business relationship with the brand.

Generally, product-centric companies achieve their goal through high volumes and cost reduction. These companies have a lot of expertise in a certain technology or area making them strive to increase their production and possibly dominate the market.

However, this might lead to them being less receptive to customer feedback, which is obviously problematic.

On the other hand, customer-centric companies rely on customer development, retention, acquisition as their major strategy. They structure their processes around the future, segmentation, and personalization.

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Look at companies like Apple, Amazon, Zappos, and Southwest Airlines and how their customer focus helped them break into incredibly competitive, established industries. They keep creating a lot of brand-new categories.

Product Centric vs. Customer Centric-Which One is More Sustainable?

Product-centric approaches to business have their roots in the industrial era and are fast losing relevance in a new age where the Customer is in charge.

Likewise, customers are willing to provide positive reviews to businesses that provide them with a fair exchange of value.

The customer-centric approach to business delivers more excellent long-term value to the company.

Because these approaches recognize customer loyalty and advocacy, they realize that a business’s value is reflected in its customer portfolio’s composition.

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Product-centricity and customer-centricity are approaches to business models. Both processes are vital for any business growth. These two approaches ideally go hand-in-hand, but it is essential to understand the difference to know how to run your business correctly.


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