Customer intimacy


Customer intimacy is a marketing and strategic management concept that emerged in the mid-1990s. The term was coined by the authors Michael Treacy and Fred Wiersema in their 1993 Harvard Business Review article "Customer Intimacy and Other Value Disciplines" and popularized in their 1995 book The Discipline of Market Leaders. It refers to one of three key value disciplines that companies can adopt to achieve market leadership.

Definition

Treacy and Wiersema did not present a formal definition of customer intimacy, but used the term to refer to a business strategy that is focused on building deep customer relationships by understanding their specific needs and tailoring offerings to meet those needs exactly.
The first formal definition and empirical assessment of customer intimacy was done by Zhou and Brock in 2012, following the widespread adoption and use of the concept in industries worldwide such as IBM. According to them customer intimacy is a customer's perception of having a very close and valuable relationship with a supplier, characterized by high levels of mutual understanding. As such customer intimacy has three dimensions:
  • mutual understanding, defined as: a customer's perception of comprehending each other – the seller’s and the buyer’s firm – on various attributes relevant to the business relationship.
  • closeness, defined as: a customer's perception of the firm having extensive person-to-person contact with a supplier, at different functional levels, characterized by open personal and working relationships.
  • value perception, defined as: a customer's perception of the firm deriving value from the relationship with the supplier, whereas value is understood as rational, economic, as well as, emotional, felt advantages arising out of the relationship.
Their subsequent empirical tests supported their definition and conceptualization of the customer intimacy construct in the Business-to-business context.

Impact

The success of the book — despite its controversies due to manipulated sales numbers — led to over 2,200 citations according to Google Scholar, and various published academic investigations and applications of the concept in industry such as:
  • Xavier, M.J., "Customer Insight and Intimacy in the Silent Commerce Era," IIMB Management Review, September.
  • Akçura, M. Tolga and Kannan Srinivasan, "Customer Intimacy and Cross-Selling Strategy," Management Science, 51, 1007-1012.
  • Yim, Chi Kin, Tse, D.K., & Chan, K.W., "Strengthening Customer Loyalty Through Intimacy and Passion: Roles of Customer–Firm Affection and Customer–Staff Relationships in Services," Journal of Marketing Research, 45:741-756.
  • Ponder, Nicole, Betsy Bugg Holloway, and John D Hansen, “The Mediating Effects of Customers’ Intimacy Perceptions on the Trust-Commitment Relationship,” The Journal of services marketing 30, no. 1: 75–87.
  • Liu, Qianhua, Ka-Ching Chan, and Ranga Chimhundu, “From Customer Intimacy to Digital Customer Intimacy,” Journal of Theoretical and Applied eElectronic Commerce Research 19, no. 4: 3386–3411.
  • Industry examples: Hubspot, Salesforce, and Zendesk.