Company- THE BODY SHOP

Reverse Your Value Chain to Be More Customer-Centric

Customer-centricity. The concept, while not new, has become one of the most popular topics
among today’s business leaders as companies explore ways to increase market momentum,
customer share and new product adoption. Why the renewed interest? Studies such as those
by American Express reveal how important it is for companies to intensity their focus on
customer-centricity. The most recent Global Customer Service Barometer survey conducted
by American Express found “just over six in ten customers agree that companies meet their
expectations”.
Customer-centricity. It’s more than a buzzword. It represents a shift in perspective, especially
for B2B companies. B2B companies tend to be more product-centric. What does it mean to be
customer-centric vs. product-centric? And what steps should your firm take to become more
customer-centric? You may find Don Pepper’s explanation about difference between
customer-centricity and product-centricity useful:
 Product-centricity starts with having a product or service that responds to customer
needs and then finding as many customers as possible who have these needs.
 Customer-centricity starts with the individual customer and aims to meet the needs of
that customer everywhere (all divisions), and as much as possible.
This is a significant shift when you consider that the majority of the Fortune 500 firms organize
their top divisions around internal criteria (i.e., product groups, functional areas); operational
functions are streamlined internally but cover multiple customer groups externally.
Customer-centricity. More than a platitude. Research has found that customer-centric
companies enjoy great customer satisfaction. And a Booz Allen study found that businesses
that are successful at customer-centricity outperform industry peers two-to-one in revenue
growth and generate margins 5%-10% above their competitors. The Internet has levelled the
distribution playing field. Price is often perceived as the determinant of value. Therefore,
companies are left with only two ways to really add value: through their brand and their
relationships with customers and prospects. Switching to a customer-centric system positively
influences both.
How to Make the Shift
A different take on “if you build it, they will come.” When you shift to a customer-centric
strategy, you are building an organization that holds the informed knowledge of the customer
and the marketplace at its heart. Your organization is aligned around customer commitments,
customer relationships, and enhanced customer knowledge. This customer knowledge is
power. While your products might be able to be copied and your channels disrupted, how well
you know your customers and your market gives you a market advantage. While the
transformation from product-centric to customer-centric comes with a cost, the benefits you
can reap are significant.
Making the shift to being customer-centric takes deliberate action. The traditional value chain
is product-centric. It calls for designing, making, and selling the product or service—precisely
in that order. Shifting to a customer-centric position requires companies to “reverse the value
chain.” Reversing the value chain has enormous implications for your business activities and
processes.
What It Means to Reverse the Value Chain
Reversing the value chain means you start with the customers’ needs and priorities. Data,
customer data, market data, competitive intelligence, these become the essential raw
materials. Some of this data may be at your fingertips and easily accessible. Other data may
be buried in your systems. And acquiring some data may require you to execute research that
involves surveying prospective customers, conducting focus groups, and creating customer
advisory boards.
Reversing the value chain also sets you on the path to identifying the channels that best deliver
what your customers need. This may mean you will need to revisit how you go to market and
with whom.
Reversing the value chain means you will need to determine the products or services best suited
for these channels. Then you will need develop the resources required to deliver the offerings
that will ensure value to the customer.

Figure 1: Reversing the Value Chain Contrast the different approaches between the
traditional and reversed value chain.
Identifying what the customer values needs to take place well before the selling stage. This
approach demands that you determine the best strategies to provide value to the customer. In
reversing the value chain, the customer’s needs are the factors that guide and drive your
business activities. Embarking on the customer-centric journey requires work up front.
 THE BODY SHOP
: STRIVING TO BE A FORCE FOR GOOD
RESEARCH AND DEVELOPMENT
Customers want products that make a difference — both to them and to the wider world; the
Body Shop’s challenge is to find the right formulations and ingredients to do that.
SOURCING AND PRODUCTION
What goes into their products is as important to them as it is to their customers. That’s why
they have one of the most extensive responsible sourcing programmes in this industry.
DISTRIBUTION AND PACKAGING
These days every major business is under pressure to reduce its carbon footprint, especially
when it comes to distribution. They think that’s a good thing.
STORES, STAFF AND FRANCHISES
Their stores are the face of The Body Shop, and their staff are the voice of the brand. The Body
Shop stores also account for the majority of our environmental impact, so they’re focusing their
improvement efforts there.
ENGAGING THE CUSTOMERS
THE BODY SHOP’s ambition is to look good, feel good do good. Their campaigns are The
Body Shop values in action, and many customers choose them for this reason alone.

The Body Shop

Stores, Staff and Engaging the

Franchises customer

Engaging the customer

Research and Development
CUSTOMER
Sourcing and Production
Distribution and Research and Distribution and Packaging
Packaging Development Stores, Staff and Franchises

Sourcing and
Production
 THE BODY SHOP
: Business Model Canvass
THE BODY SHOP: BUSINESS MODEL CANVASS

Key Partners Key Activities Value Propositions Customer Customer

Relationships Segments

L’Oreal (Owner) Selling top of the Convenient one stop shop Promoting beauty in Tweens
line beauty for beauty conscious the customer’s eye
Suppliers (farmers products instead of the Youth
and suppliers) Enterprise in related beholder’s
Cosmetics fields Elders
Distributors Reward Zone
Fragrances Delivery Product Quickly Parents
Vendors The company
Franchises Unique blend of ethical combines activism Mass
Affiliates management beauty with a sense of with marketing Market
humour and serious
Franchises Customer Service purpose to the world Encouraging women
to focus on self-
Community Trade Marketing They Search the world for esteem as well as
Program the finest ethically- social and
sourced ingredients to environmental
create a range of naturally causes
inspired beauty products.
Free Standard
Being 100% vegetarian delivery on orders
and always and forever over 15$. True
being firmly against Sustainability
animal testing.

Variety +1000 Products

Key Resources Channels

Knowledge Sales Associates Body Shop Retail Stores

Top of the line beauty Products Bodyshop.com

Kind Sales People Hemp Body care Online

Competitive Prices
The Body Shop at Home (an in-
home sales program)
60 plus Markets worldwide
 Card
3,000 stores in 66 Countries

22,000 people

Absence of Glamorous Ad Campaigns

Cost Structure Revenue Streams

Labour Cost Sells of products

Product Cost Sell of service

Location Cost Products Sold at vendor sites

Sever Space and Other Expenses

More than 3,000 stores (majority
franchised)
 The Body Shop Value Proposition Canvas
Value Proposition Customer Segment

Customer Loyalty
Natural
ingredients
Natural
and products
ingredients in all
with
products
environmenta 100% Natural
l concern Packaging – Products.
carries bags were
First Genuinely
made of 100%
company environment
recycled paper
campaign for al friendly
and printed with
anti-animal products.
water soluble inks
test
Supporting
Product & 100% PCR bottles
the
Services by year 2008 farmers

Brand domain: Save the

The palnet
target market Ensure
is beauty and sustainable
health developme
Brand values:
conscious A lot of nt
women of Defend human rights misinform
higher income ation on
2. Support community fair
group, the
trade
cosmopolitan ingredient
customers. 3. Protect the planet of the
products
4. Against animal testing
and use of
5. Activate self esteem artificial