Customer intimacy measures the attentiveness with which a company can meet consumer needs. One of the best definitions of the concept comes from strategy experts Michael Treacy and Fred Wiersema who described it as “segmenting and targeting markets precisely and then tailoring offerings to match exactly the demands of those niches.”
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Understanding customer intimacy
Customer intimacy is a measure of an organization’s awareness and understanding of customer values and needs.
Customer intimacy is more than simply taking a proactive approach to customer interaction.
Instead, the companies that will succeed are those that see customer intimacy as a two-way connection where perception matters.
Success is also contingent on an ability to build a customer-oriented culture that permeates every level and department of the company.
These companies also understand the needs and expectations of the target audience and the importance of close communication and resource creation to maximize the value of products and services.
As Treacy and Wiersema explained in a Harvard Business Review article, “No company can succeed today by trying to be all things to all people. It must instead find the unique value that it alone can deliver to a chosen market.”
Why is customer intimacy important?
Unlike traditional marketing strategies focusing on promotion and selling, customer intimacy is very much about customer service and satisfaction.
When customers are satisfied, several important benefits can be realized. These include improvements to brand reputation, sales volume, customer retention, team decision-making, and customer loyalty.
Customer intimacy is also seen as particularly important in markets with a lack of product differentiation.
With each product the same as all others, customers tend to choose companies whom they believe care about them the most.
This ability to stand out from the competition is likely to become more important in the future.
Buyers have more power and choice than at any point in free market history and many industries – such as software and transportation – are now hyper-competitive.
Customer intimacy strategies
There are many ways that a business can foster customer intimacy. Here are just a few of them:
Company-wide customer support – hearing about customer stories or pain points from others is not the same as experiencing them firsthand. To increase customer intimacy and build authentic connections, involving every employee in customer support can be useful–whether a new intern or the CEO.
Customer advisory boards (CABs) – think of a customer advisory board as a panel of the company’s most valued customers that is similar in form and function to the board of directors. CABs offer unvarnished advice, review industry trends, and address mutual opportunities or problems.
Customer meetups – many companies utilize meetups to learn more about their customers. This is effective since the attraction of an event where one can interact with like-minded individuals is strong. Meetups should ideally be held in cities where key team members work and feature a keynote speaker who is admired by (and can mingle with) customers in a somewhat natural and relaxed environment.
Case studies
Amazon:
Company-wide customer support: Amazon ensures that every employee, from warehouse staff to top executives, understands the importance of customer service. They encourage employees to spend time in customer service roles to gain firsthand experience and empathy for customer needs.
Zappos:
Company-wide customer support: Zappos has a unique approach where they offer new hires a monetary incentive to quit if they feel the company culture isn’t right for them. This ensures that every employee is genuinely dedicated to customer satisfaction.
Ritz-Carlton:
Company-wide customer support: The Ritz-Carlton empowers employees at all levels to resolve guest issues promptly. This approach enables them to provide exceptional service without bureaucratic delays.
Nordstrom:
Company-wide customer support: Nordstrom’s sales associates are trained to build relationships with customers. Employees are encouraged to use their judgment to ensure customer satisfaction, even if it means bending the rules.
Lululemon:
Customer meetups: Lululemon hosts community events like yoga classes and run clubs in various cities. These events allow customers to interact with like-minded individuals, fostering a sense of community and shared values.
Salesforce:
Company-wide customer support: Salesforce offers customer support and training to its clients, ensuring that they get the most value from the CRM platform. This approach aligns every employee with the goal of customer success.
Walt Disney World:
Company-wide customer support: Disney World’s “cast members” are trained to create magical moments for guests. Every employee, from ride operators to janitors, plays a role in delivering exceptional experiences.
JetBlue:
Company-wide customer support: JetBlue empowers employees to resolve passenger issues on the spot, enhancing the flying experience. This approach sets them apart in the airline industry.
Applebee’s:
Customer advisory boards (CABs): Applebee’s forms CABs consisting of its most loyal customers. These boards provide valuable feedback and insights that help tailor the menu and dining experience.
Spotify:
Company-wide customer support: Spotify’s data-driven approach ensures that every user receives personalized music recommendations. Their employees work collaboratively to refine algorithms and curate playlists.
Key takeaways:
Customer intimacy is a measure of an organization’s awareness and understanding of customer values and needs.
Unlike traditional marketing strategies which focus on promotion and selling, customer intimacy is very much about customer service and satisfaction. It may be particularly effective in hypercompetitive markets or those characterized by little product differentiation.
Businesses can foster customer intimacy via customer meetups and customer advisory boards that are similar to a standard board of directors. Some companies will also benefit from involving all levels of management in customer service so that employees can hear problems firsthand.
Key Highlights
Definition by Treacy and Wiersema: Customer intimacy involves precisely segmenting and targeting markets, then tailoring offerings to match the demands of those niches. It’s about understanding customer values and needs.
Two-Way Connection: Customer intimacy is not just proactive customer interaction, but a two-way connection where perception and understanding matter. It’s about building a customer-oriented culture throughout the company.
Customer-Oriented Culture: Successful companies build a culture that prioritizes customer needs and expectations. This involves close communication and resource creation to maximize the value of products and services.
Unique Value Proposition: Companies should identify and deliver a unique value that sets them apart from competitors, as trying to serve everyone is not a viable strategy.
Importance of Customer Satisfaction: Unlike traditional marketing, customer intimacy focuses on customer service and satisfaction. Satisfied customers lead to benefits like improved brand reputation, sales volume, customer retention, and loyalty.
Market Differentiation: In markets with little product differentiation, customer intimacy becomes a distinguishing factor. Customers tend to choose companies that show genuine care for them.
Hyper-Competitive Markets: As markets become more competitive, standing out becomes crucial. Customer intimacy strategies can help companies differentiate themselves in such environments.
Strategies for Customer Intimacy:
Company-wide Customer Support: Involving every employee in customer support fosters authentic connections and firsthand understanding of customer pain points.
Customer Advisory Boards (CABs): CABs consist of valued customers who provide advice and address mutual opportunities or problems.
Customer Meetups: Hosting meetups in cities with key team members and engaging activities like keynote speakers can help companies learn more about their customers.
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Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
