The debate over buyer-centric vs. customer-centric concepts has resurfaced once again in Jennifer Rice’s blog. In an effort to bring some clarity to this, I blog below extracts from the website of the Buyer-Centric Commerce Forum. Written (I believe) by Right Side Up and The New Bottom-Line author Alan Mitchell, this provides perhaps the best and most succinct definitional analysis of the distinctiveness of buyer-centric thinking.
"The first question posed is simply, what is different about buyer-centricity? Isn’t it just another way of being customer-centric, and of doing customer managed relationships (CMR)? Here is the answer:
Customer centricity looks at products and services in their broadest sense – from purchase to use to service to disposal, including related information and services – from the customer’s point of view to meet his product/service needs and wants better.
Customer Managed Relationships looks at the conduct of the relationship (process, communications, transactions) between a particular seller and a customer from the customer’s point of view, to meet his relationship management needs and wants better.
Buyer centricity looks at markets and the process of going to market from the buyer’s point of view.
Superficially, they can be lumped in the same basket. They appear to ‘focus on the customer’ and try to identify and meet the customer’s needs and wants. But there are at least three fundamental differences between buyer-centricity, CMR and customer-centricity.
1) Means and ends. Both ‘customer centricity’ and CMR attempt to meet customers’ needs as means to sellers’ ends. They are adopted as strategies by individual sellers in order to meet their particular selling objectives: e.g. to sell more, more profitably etc. Under buyer centricity, meeting the customer’s needs is not a means to an end. It is the end.
2) Outlook. All seller-centric strategies and initiatives look at the world of customers through the seller’s eyes. Buyer-centric commerce looks at the world of sellers through the buyer’s eyes.
Every seller-centric marketing concept (including customer focus, customer-centricity, CRM, CMR, permission marketing, 1-to-1 marketing, etc, etc) starts from the point of view of one particular seller, with the assumption that this seller is dealing with many different buyers.
Buyer-centric commerce starts from the point of view of each particular buyer, with the assumption that this buyer is choosing from among, dealing with, etc, many different sellers.
Seller-centric marketing is about helping sellers deal with buyers. Buyer-centric commerce is about helping buyers deal with sellers.
3) Source of value. The seller-centric marketer assumes that the source of value for the customer lies in the better/cheaper/etc product or service that he is bringing to market. For buyer-centric commerce, on the other hand, the source of value lies in a better/cheaper/etc go-to-market process for the buyer.
Buyer-centric commerce therefore subsumes and includes seller-centric value, as just one ingredient of a much broader, richer value offering. It’s about sourcing the best/most appropriate product/service (what seller-centric marketing has to offer) plus improving the process of sourcing (and using) this product/service.
In short, in buyer-centric commerce the acid test of success is not whether it helps a particular seller sell more, more profitably, but whether it helps a particular buyer to go-to-market more efficiently and effectively and to source more value, more ‘profitably’.
(In reality, buyer-centric commerce goes way beyond the narrow realms of buyers’ go-to-market or ‘sourcing’ processes – it is about helping individuals maximise the value they create in their own lives and through their interactions with other people/organisations. But that is a broader, and slightly different discussion.)
Buyer-centric commerce therefore represents an entirely new market – a market which requires entirely new business models and probably, organisational structures and operational infrastructures and processes. Constructing an organisation that helps an individual buyer deal with many different sellers is very different from constructing an organisation that helps a seller deal with many different buyers.
Buyer-centricity is also completely counter-intuitive to the seller-centric mindset, which judges every activity and initiative by the degree to which it helps a particular seller sell, rather than helping buyers to source value on the open market. That’s why so many business people, trained and steeped in seller-centric attitudes and assumptions just don’t ‘get’ it. Ultimately, customer-centricity and CMR are still about helping sellers to sell. They still dwell within the territory of seller-centricity.
Does that mean there is no connection between customer-centricity, CMR and buyer-centricity?
In fact, there is a close connection – though not the one most seller-centric marketers see. The connection is this: the processes, skills and infrastructure needed to make customer-centricity and CMR work – understanding of customers’ needs at different points of the purchasing process, developing information systems and infrastructure capable of responding to different individuals’ needs at different times and circumstances through different channels, etc – are all essential for any successful buyer-centric business model.
Concepts, tools and techniques like this are like the chick within the egg. As long as they are kept confined within the narrow boundaries of seller-centricity, their true potential will never be realised."
Moving to a Customer Experience perspective
Regardless of the definitional distinctiveness of buyer-centricity, customer-centricity and so on, in truth all that matters to the individual (you and me) is the quality of the context-specific experience we have with organisations when we interact, transact, communicate, derive and exchange knowledge with them. This interaction can operate across a spectrum of experience types, levels of customer involvement and range of choices, options and channels: whether passive, active, co-creative, distributed, peer-to-peer community, explicit or implicit. Nevertheless, what buyer-centricity does do (as evidenced by these blog debates) is expose the disconnect that now exists between traditional corporate speak for customer-centricity and the new language and framework for individual-centric commerce. As I have repeatedly argued, by acknowledging this disconnect, firms can identify, design and achieve new breakthroughs in customer experience innovation.
At the risk of oversimplifying, customer-centric focuses on the things a seller needs to do to create and keep a customer. It comes from the seller's point of view.
Buyer-centric looks at the world from the buyer's perspective. It looks at their problems, the results they are trying to produce and the process they go through to to solve the problems and produce the results. The more sellers can walk in the buyer's shoes, the better they will design, sell and deliver products and services in a way that best meets the buyer's needs.
Posted by: Ron Snyder | February 13, 2009 at 07:06 PM
I don't disagree with your distinction between buyer-centric versus seller-centric. Buyer-centricity is a big step in the right direction to get companies out of their seller-centric mindset towards a customer-experience mindset; however, there are stakeholders that must be considered in addition to customers. How are employees prioritized in a buyer-centric organization? What about the larger community in which the company operates? I'm advocating that managers must take the macro view of their business -- using a stakeholder-centric viewpoint -- in order to achieve a measure of socially responsible success.
There. Have we succeeded yet in "beating this topic into subatomic particles and beyond?" (my new favorite quote from an online discussion group) :-)
Posted by: Jennifer Rice | January 20, 2004 at 03:40 AM