Eh, making customers happy is absolutely still a thing, but it only really applies to smaller companies. Small companies win through superior service, large companies win by being the default option. Once a company is the default option, it comes down to how much profit the company can extract.

The problem isn’t capitalism, but all of the rules both explicit and implicit that benefit large companies over smaller companies. Very rarely does a small company lose due to not having economies of scale (does happen though), usually it’s because of startup costs, and those go up substantially when there’s a large player because of all the barriers in place. For example, ISPs will sue to prevent newcomers from getting established. If you don’t have deep pockets, there are many industries you just can’t get started in.

It used to be that large companies could fail if they royally mess up, but now get just get bailed out. Or they buy their competition so they don’t need to innovate. Or they sue their competitors so they can’t compete. The problem isn’t capitalism itself, the problem is all the nonsense that protects those with more and allows them to bully those with less. The problem is ineffective government.