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, the strategic customer should represent the target audience for the product development. Besides this, the strategic 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 strategic 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 the strategic 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.