Users vs. Customers: What’s the Difference?
Within product development and design and user research, you’ll frequently come across the terms ‘users’ and ‘customers’. They’re both important to the product development journey in terms of finding user needs as well as who your buyers are. Their involvement can provide valuable insights as to the potential success of the product or service, but they offer these insights from different perspectives, based on their differing motivations; to quote StartUpRunner: “users use and customers buy.” So while it’s really important to include both, it’s equally important to understand what differentiates them from each other.
What is a user?
A user is the person who will actually be using the product or service once it has been built. They are the people who will incorporate your product or service into their daily lives, and for whom you have ultimately designed your innovation.
What’s firstly important to note is that your users might not be the people who purchase your product or service; they are your customers. For example, if you were to buy an educational gadget for your child, you are the customer but the child is the end-user.
Furthermore, your users are the people whose problems your product or service aims to solve. Hence we conduct design research to understand the problem in more detail, and ensure that the product or service design effectively addresses it.
Users can be collected into ‘user groups’, identifying those with a shared interest, motivation or behaviour. Ideally you have 3-5 clear user groups that you can prioritise based on which one has the biggest problem you’re looking to solve as a starting point. It is not expected that design research will be used as an extensive market research exercise to understand the customer needs across all user groups. Sometimes there is confusion as to what user groups are and what market segments are.
User groups are those who have a problem you’re looking to solve with your product and they’re most likely to be the end-users, but not necessarily the customer. Ultimately user research and design research are there to look at how the product solves the user’s problem or challenge and how the product can deliver this within particular constraints - be it time, skills or resources.
What is a customer?
Customers hold the buying power and are key stakeholders and decision-makers, as they are the people who will ultimately be purchasing your product or service.
Their involvement in the development journey can crop up in user research as they may be a user too. If not, then market research can be a useful tool to understand more about the buying process and what buyers will be looking for when purchasing the product; customers can provide valuable information in terms identifying market segments and looking at who will likely be buying the product or service. They will provide information on how the product can add value to the business or process but they may not be the end-users. A potential end-user may put together a business case to an individual with buying power to purchase the product.
What are the differences?
The key differences between users and customers are that users provide insights as to how people will interact with the product or service, and whether or not it solves a genuine problem and customers’ involvement focuses more on the characteristics of the target market in terms of who may or may not likely purchase it.
The aims of speaking to users or customers are very different, which is why it’s important to differentiate between your users and customers before asking them to take part in research. Typically users are involved at the beginning of the product development journey who may flag up buyers and buyers behaviours, and personas may arise later in the process to identify if there is a market for the product and if the problem is pressing enough for people to purchase it. This type of enquiry is also known as Product-Market Fit and it is something that product managers are keen to keep working on even whilst the product is in the market.
What is a stakeholder?
A stakeholder a person or an organisation with an interest in the product or service you’re building. A stakeholder may be a user or a customer, or it may be a potential partner or organisation that you can learn more from if there were regulations or standards to adhere to. Stakeholders can help you learn a lot about your product; for example, if you’re building a transport product like an e-scooter, you’d like to know how people would use the product to build the scooter, then you’d like to know who would buy these, such as the local council and then you may also like to know what the stakeholders thought such as the local community. They can add more of a wider, contextual aspect to your research.
Keep learning
Hopefully this post helps you understand the difference between users and customers, and how their involvement in the research process differs. It's really important to differentiate between users and customers before embarking on any research, to ensure you gather the data you need.
