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What is a Strategic Customer?

Mary Elizabeth
Updated May 16, 2024
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A customer is a person or organization that purchases products or services from a business. When the phrase strategic customer is seen, it most often precedes another noun, which is actually part of a compound word with customer. Examples are strategic customer service which is a type of customer service, not a type of customer. On the other hand, Jon Fisher — formerly CEO of Bharosa® which was acquired by Oracle® Corp and now entrepreneur and adjunct professor of business at University of San Francisco — refers to the strategic customer as a customer who can play a particular role in collaboration with a business.

Fisher discusses the situation in which a business wants to collaborate with a customer in product design. He postulates two initial goals of this enterprise: first, creating a solution that is tailor-made for the particular customer with whom the business is partnering; second, creating a flexible or broadly popular solution such that it can be sold to other customers who need something similar. The way to achieve both goals at the same time, according to Fisher, is to collaborate with a “strategic customer.”

Fisher defines a strategic customer as one who possesses two characteristics. For one thing, this customer should represent the target audience for the product development. Besides this, the customer should possess an outstanding reputation in its field, whatever field that is, such that both the partnering business and the resulting product will benefit from the association. The customer’s reputation will help enhance the business’s credibility as well as help sell the product of the collaboration to others.

According to Fisher, choosing collaborations with strategic customers as a development mode can lead to a third beneficial result. It can make the business desirable as an acquisition. Because buying a company includes buying its customer base, the quality of customers adds to the business’s desirability as an acquisition. The close relationship that collaboration brings about means that this type of customer is less likely to “jump ship” during a buy-out and move to another rival, so the acquiring company can feel more secure in its prospects when a business has worked to develop a number of strategic customer partnerships.

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Mary Elizabeth
By Mary Elizabeth
Passionate about reading, writing, and research, Mary Elizabeth is dedicated to correcting misinformation on the Internet. In addition to writing articles on art, literature, and music for SmartCapitalMind, Mary works as a teacher, composer, and author who has written books, study guides, and teaching materials. Mary has also created music composition content for Sibelius Software. She earned her B.A. from University of Chicago's writing program and an M.A. from the University of Vermont.
Discussion Comments
By anon998093 — On Apr 09, 2017

@RoyalSpyder: What you are describing is procurement management from a consumer perspective. Based on this article, if one uses coupons when purchasing thee most likely do not have much influence within the customer segment and thus is not considered as a strategic customer from the marketer's perspective.

By RoyalSpyder — On Mar 03, 2014

Being a strategic customer is one of the most important things you can do when you're shopping. Besides looking for the cheapest price, always make sure to look for a quality product. Remember, cheaper doesn't always mean better, and expensive doesn't always mean that it's a trap. It really goes both ways. Another way to be a strategic customer is to look for sales, and save up on coupons. Though they're a bit difficult to find, especially in magazines, they always help in the long run.

Mary Elizabeth
Mary Elizabeth
Passionate about reading, writing, and research, Mary Elizabeth is dedicated to correcting misinformation on the...
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