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.”
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.
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.
Related Agile Business Concepts
AIOps
AIOps is the application of artificial intelligence to IT operations. It has become particularly useful for modern IT management in hybridized, distributed, and dynamic environments. AIOps has become a key operational component of modern digital-based organizations, built around software and algorithms.
Agile Methodology
Agile started as a lightweight development method compared to heavyweight software development, which is the core paradigm of the previous decades of software development. By 2001 the Manifesto for Agile Software Development was born as a set of principles that defined the new paradigm for software development as a continuous iteration. This would also influence the way of doing business.
Agile Project Management
Agile project management (APM) is a strategy that breaks large projects into smaller, more manageable tasks. In the APM methodology, each project is completed in small sections – often referred to as iterations. Each iteration is completed according to its project life cycle, beginning with the initial design and progressing to testing and then quality assurance.
Agile Modeling
Agile Modeling (AM) is a methodology for modeling and documenting software-based systems. Agile Modeling is critical to the rapid and continuous delivery of software. It is a collection of values, principles, and practices that guide effective, lightweight software modeling.
Agile Business Analysis
Agile Business Analysis (AgileBA) is certification in the form of guidance and training for business analysts seeking to work in agile environments. To support this shift, AgileBA also helps the business analyst relate Agile projects to a wider organizational mission or strategy. To ensure that analysts have the necessary skills and expertise, AgileBA certification was developed.
Business Model Innovation
Business model innovation is about increasing the success of an organization with existing products and technologies by crafting a compelling value proposition able to propel a new business model to scale up customers and create a lasting competitive advantage. And it all starts by mastering the key customers.
Continuous Innovation
That is a process that requires a continuous feedback loop to develop a valuable product and build a viable business model. Continuous innovation is a mindset where products and services are designed and delivered to tune them around the customers’ problem and not the technical solution of its founders.
Design Sprint
A design sprint is a proven five-day process where critical business questions are answered through speedy design and prototyping, focusing on the end-user. A design sprint starts with a weekly challenge that should finish with a prototype, test at the end, and therefore a lesson learned to be iterated.
Design Thinking
Tim Brown, Executive Chair of IDEO, defined design thinking as “a human-centered approach to innovation that draws from the designer’s toolkit to integrate the needs of people, the possibilities of technology, and the requirements for business success.” Therefore, desirability, feasibility, and viability are balanced to solve critical problems.
DevOps
DevOps refers to a series of practices performed to perform automated software development processes. It is a conjugation of the term “development” and “operations” to emphasize how functions integrate across IT teams. DevOps strategies promote seamless building, testing, and deployment of products. It aims to bridge a gap between development and operations teams to streamline the development altogether.
Dual Track Agile
Product discovery is a critical part of agile methodologies, as its aim is to ensure that products customers love are built. Product discovery involves learning through a raft of methods, including design thinking, lean start-up, and A/B testing to name a few. Dual Track Agile is an agile methodology containing two separate tracks: the “discovery” track and the “delivery” track.
Feature-Driven Development
Feature-Driven Development is a pragmatic software process that is client and architecture-centric. Feature-Driven Development (FDD) is an agile software development model that organizes workflow according to which features need to be developed next.
eXtreme Programming
eXtreme Programming was developed in the late 1990s by Ken Beck, Ron Jeffries, and Ward Cunningham. During this time, the trio was working on the Chrysler Comprehensive Compensation System (C3) to help manage the company payroll system. eXtreme Programming (XP) is a software development methodology. It is designed to improve software quality and the ability of software to adapt to changing customer needs.
Lean vs. Agile
The Agile methodology has been primarily thought of for software development (and other business disciplines have also adopted it). Lean thinking is a process improvement technique where teams prioritize the value streams to improve it continuously. Both methodologies look at the customer as the key driver to improvement and waste reduction. Both methodologies look at improvement as something continuous.
Lean Startup
A startup company is a high-tech business that tries to build a scalable business model in tech-driven industries. A startup company usually follows a lean methodology, where continuous innovation, driven by built-in viral loops is the rule. Thus, driving growth and building network effects as a consequence of this strategy.
Kanban
Kanban is a lean manufacturing framework first developed by Toyota in the late 1940s. The Kanban framework is a means of visualizing work as it moves through identifying potential bottlenecks. It does that through a process called just-in-time (JIT) manufacturing to optimize engineering processes, speed up manufacturing products, and improve the go-to-market strategy.
Rapid Application Development
