Is customer intimacy a better competitive edge than measuring brand intimacy?
MBLM released the findings of their study, ‘Brand Intimacy COVID Study 2021’ that evaluated the emotional connections between customers and brands during the pandemic. For the second year in a row, Apple has ranked first as the most intimate brand during COVID-19, topping Disney, Amazon and Netflix.
The study is essentially anchored in the idea that customers can love brands. But what about the idea of Customer Intimacy? That brands have a deep and intimate understanding of their customers?
In 1997 in their book The Discipline of Market Leaders, and paper published in HBR Customer Intimacy and Other Value Disciplines, Treacy and Wiersma described three competitive strategies that businesses could focus on – operational excellence, customer intimacy and product leadership:
- An operational excellence strategy aims to accomplish cost leadership. Here brands focus on automating processes and work procedures in order to streamline operations and reduce cost. Think Guy Russo’s 2008 strategy to turn the Kmart business around in Australia where the teams investigated every inch of the business to cut costs and deliver the lowest price in the market. This type of strategy lends itself to high-volume, transaction-oriented and standardised production that has little need for much differentiation.
- Product leadership as a competitive strategy aims to build a culture that continuously brings superior products to market. Here product leaders achieve premium market prices thanks to the experience they create for their customers. A brand like Apple would be considered a product leader. They don’t ever discount and spend a lot of money of marketing their expertise.
- Finally, and our favourite, the customer intimacy strategy. As described by Treacy and Wiersma, it focuses on offering a unique range of customer services that allows for the personalisation of service and the customisation of products to meet differing customer needs. ‘Customer intimacy is the … segmenting and targeting markets precisely and then tailoring offerings to match exactly the demands of those niches. Companies that excel in customer intimacy combine detailed customer knowledge with operational flexibility so they can respond quickly to almost any need, from customizing a product to fulfilling special requests. As a consequence, these companies engender tremendous customer loyalty.’
So how do you build your customer intimacy?
1. Implement policies to enable the business to be customer obsessed: Businesses that have a genuine leaning into their customers, a real interest into what makes them tick and why they behave the way they do, are much better at being customer obsessed. It starts with the top. The board and the exec team who go out and spend time in stores, online and face to face with customers are giving very clear signals to the rest of the organisation what is important. This culture is then supported with operations and polices to allow the whole business to spend time with the customers. Start with adding customer conversations as a KPI to get people in the habit is key.
2. Humanise your customers. Thinking of customers as real people makes a big difference to a brand team’s success. For the whole organisation to be able to talk about customers in an authentic way means they are more than a number on a big data dashboard. It’s having customer conversations integrated into the way you work. Talking to you customers, actually having conversations on a regular basis, means you are hearing what is important to them and what things they need from your business.
3. Develop real empathy for your customers’ painpoints. Access your current channels to interact with your customers and build up a set of customer irritations. Read your complaint and social media pages, take calls in your call centre and serve customers in your shops. Try and solve the problems that your customers have with your brand experience at the coalface so you can build an empathetic view of what it is like to deal with your business.
The takeaway here is that it pays to dig deep with your customers. Customer Intimacy is understanding their needs and wants better than your competitors and one of the most powerful predictors of loyalty we have. This brand loyalty could be called love or Brand Intimacy but it starts Customer Intimacy.