These two words are often used interchangeably. But what is the actual difference between them, and why should brands care?
The Customer: this is the person your business interacts with, most often the shopper or purchaser of your product or service.
The Consumer: this is the end user of your product or service.
Still unsure how these two are different? Let’s lay out an example to illustrate the difference between these two stakeholders. Diapers are a very important consumer good, and there are a few brands that dominate this particular market, but we’ll use Pampers as an example here. Let’s take a look at the customer and the consumer for Pampers, using the definitions above.
Pampers customer: parents of babies and toddlers
- Interact with Pampers
- Shop for and purchase Pampers
- Select Pampers over other brands
- Influenced by Pampers marketing and sales tactics
Pampers consumer: babies and toddlers
- Wear (consume) Pampers
- Poop in Pampers
- Pee in Pampers
Things should be much clearer at this point. There is a clear distinction between who the customer is and who the consumer is. The customer buys, the consumer uses. At this point, we will throw in a little spanner in the works. There is one more type of customer.
Pampers customer A: retailers of Pampers (e.g. Walmart)
- Buy directly from Pampers
- Re-sell Pampers to parents
- Purchase decisions are governed by demand of their own customers
- Looking to make profit from Pampers
- Probably also selling Pampers competitor brands
Understanding how these different types of audience members can possibly differ from each other is extremely important when creating effective marketing and sales strategies. Each of these stakeholders have different interests and purchase motivations. Driving purchase and winning (over competitors) through the entire chain is important to increase brand equity and profit. Going further to win an emotional connection with each of these stakeholders is a key to brand success. Read our article about brand building (to understand how emotional connections can drive purchase).
Now we understand how the consumer is different from the customer. Why should you care?
Asides giving your brand a clear idea who you cater to, and how to communicate with your most important stakeholders, it gives a clear indication of who the different segments of your business should be built for. A general guide is: build your product or service for your consumer; build your processes, sales channels and incentives for your customer. Communication should be created for both the customer and consumer, and if they are clearly distinct, there should be tailored communication for each of them.
In the case of Pampers, their merchandising, retailer selection, sales tactics, displays and some purchase incentives are created for the customers (parents). Their sales channels, wholesale pricing and some specific purchase incentives are created for the customers (retailers). However, the product itself – the diapers are designed for the consumers (babies and toddlers). They are created for the purpose of absorbing the smelly waste that cute babies produce in the best way possible, providing comfort for them at the same time. Product innovation and improvement should be based on the needs of the consumer. Communication is created for all three stakeholders based on their purchase motivations, values and interests, and communication for each of the three stakeholders is distinct.
There are certain scenarios where the customer and consumer are one and the same, especially where a brand sells directly with no retailers or middlemen, and where the shopper or buyer is the consumer. A great example of brands that have this model is restaurants. The customer is more often than not, the consumer. The same person who orders the food eats the food, and purchases directly from the restaurant. Having this model means all messaging and improvement should be directed at the same person. This model requires a deep knowledge and study of the various needs, motivations, behaviour and values of one persona. It requires a multi-faceted approach to profiling and understanding the single consumer/customer.
It is extremely important to assess your brand from the lens of the customer and consumer. Are they one and the same? Are they different? And what is the best way to win them all? One of our key services at The Y Brand is helping brands create effective Brand Strategy, including customer and consumer profiling. We also create effective Campaign Strategies, with storylines and communication tactics that are effective for your particular target audience. These help to deliver effective communication and marketing campaigns and ensure that return on your marketing and communication spend is positive. Send us an email today at firstname.lastname@example.org to get started on your journey to effective Marketing.