redefining customers vs consumers vs...what's actually relevant today?

Author: Nick Tucker
Last updated: 13 Nov 2019
Length: 1003 words / 4-5 minute read

Yesterday, I explored the changing nature of how audiences need to be considered and defined, and pointed to the implications for brand positioning and messaging. The article ended with a definition of target audience, and it's clear to me that the traditional approach to segmenting that grouping is no longer serving its purpose.

The challenge here comes from the many different ways in which the target audience can now engage with your content, product, service, etc. The simplest place to start this exploration is with the terms consumers and customers. Together, they're a set of descriptors that served us well in the past, but which have been fraying at the edges for some time.

Consumers: those who actively consume or use your content, product, service, etc.

Customers: those who make a payment (either before, during or after) for accessing your content, product, service, etc (see below for explanation of 'pay').

And this is where it gets tricky. Consider the YouTube channel host who earns revenue from advertising. The consumers are, in general terms, those watching the videos. And the host will likely aim to produce relevant, high quality, interesting content to keep that audience of consumers engaged and growing. Why? Because the host's customers (the advertisers) are attracted not by the content, but by the size and relevance of the channel's consumers to their targeting. The consumer and the customer are different, have different priorities and have different needs.

But nowadays, what constitutes relevant and valuable 'payment' (i.e. what separates customers from consumers) is not limited to money. Hitting the 'like' or 'subscribe' buttons on YouTube is payment in support, Tweeting is payment in social capital (i.e. it has value based on the audience and influence of the Tweeter), adding a comment is (potentially) payment in perspective, expertise or experience. When it comes to reaching a wider audience, boosting search rankings and gaining audience insights, all have value. In some cases, a lot of value.

And there are equivalents across many different spheres, whether B2B or business-to-consumer (B2C). If the business researcher ends up pitching your services as the one to choose, they're no longer a passive consumer. They are effectively acting as your representative. If they're in an agency tasked with presenting a proposal to a client, that agency may not even end up being the 'money-paying' customer.

We also now have new models of business, most easily demonstrated by the software-as-a-service (SAAS) sector. I can sign up and become a user of the free version before paying (or not) for the upgrade. Or I might get a 30-60 day trial of the full version before I'm downgraded or have to pay. Am I a consumer, a customer or a user? If I decide not to pay, but write an amazing review, I've completed a very customer-like transaction. The value offered to me was sufficient that I decided to expend time and reputation in writing that review. I received something of value, I gave something of value. By some interpretations, that transaction makes me a customer.

It would seem that consumer and customer are both rather blunt tools, and that they're no longer fully serving our needs. Instead, we need a new set of terms that clearly describe and define those key subsets of the target audience that are useful from a positioning and targeting perspective.

Rarely will an organisation be targeting every one of the proposed subsets (or categories) that I've set out below. And as is the case for customers and consumers, many will also contain individuals or organisations outside the target audience profile. However, it's the target audience that we're focused on here as we consider the implications of a possible new approach to categorisation:

Receivers: those who do nothing more than have contact with your content, product, service, etc.

Users: those who use your content, product, service, etc. multiple times (probably more than three times to warrant inclusion in this category) in order to achieve their own goals (beyond pure entertainment), e.g. SAAS, instructional content.

Supporters: those who value your content, product, service, etc. sufficiently to subscribe, 'like' or the equivalent (i.e. actions that don't require financial payment).

Funders: those making a financial contribution in response to, or to access, your content, product, service, etc., e.g. direct payment, Patreon donation, paid subscription.

Providers: those who react to your content, product, service, etc. by providing information, e.g. comments, contact details, survey completion.

Promoters: those who transmit to others your content, product, service, etc, or information about it or links to it (in full, in part or after interpretation).

Connectors: those who respond to your content, product, service, etc. by instigating direct, active contact with your organisation (i.e. more than a passive 'receive email notification' relationship).

Outsiders: those who do not come into contact with your content, product, service, etc., either directly or indirectly (i.e. the sector of your target audience you're missing entirely...   ...and the key question to ask is: why?).

It's clear that there are overlaps, and that individuals and organisations can and will move between these eight categories. Someone who's prompted to provide an email address for an offered 'How to..' pdf will initially be a provider (of the email), likely (but not necessarily) become a regular user (of the information in the pdf), but may then lapse into being a receiver (of an email newsletter). And eventually perhaps unsubscribe from that email list entirely, at which point they become an outsider.

This example illustrates nicely how useful such categorisation can be, particularly when compared with the now outdated 'black and white' concepts of either consumer or customer. There are so many shades of grey to consider here!Imagine mapping out the flows, tracking the triggers and timings of shifts between categories, and conducting seperate research interviews with the various category. Imagine developing those insights into needs, barriers and opportunities for each, including the implications of any overlaps.

Integrating that level of detail into strategies for positioning and delivering brand experience is where it gets really interesting!