Customer vs Client
If you’ve been in business for any length of time, you’ve probably come across the term “CRM”. Even if you don’t know what it means, you’ve heard it mentioned, seen ads for products and services offering to provide “CRM” for you, and webinars and workshops promising to teach you how to master “CRM”. But what does it mean and, more importantly, what does it mean to you and to your business?
CRM stands for Customer Relationship Management, a simple enough phrase to decipher even without any further explanation. Managing the Relationship between you and your customer. Seems simple enough until you ask the obvious questions – “how am I supposed to do that?” and “why do I need a separate program/service/consultant just to manage these relationships?” And what aspects of the relationships are we supposed to be managing, anyway? And how does any of this relate to me running my business better, more efficiently or more profitably.
Honestly, we at CommunIT Solutions have never liked the term “Customer Relationship Management”. It’s always seemed… too casual, too vague and not distinctly business-related. We’re about business, not social services or match making. So “Customer Relationship” has always struck us as an odd thing to focus on. Sure: we want aim to be pleasant, personable, honest and well-behaved — all that good stuff. Business is, after all, about relationships, and these traits and qualities certainly make relating to people much easier.
What we strive for and focus on when dealing with our customers is offering them superior value, and GETTING PAID for it. And, of course, once we’ve done that we want to KEEP doing that. With the same customers… because now we know HOW to, and we know that we CAN. Thus we have, internally, redefined “CRM” to mean “Client Retention and Monetization“.
In addition, we’ve gone a step further and defined an expanded acronym – CREAM – which stands for Customer Retention, Engagement, Acquisition and Monetization. Yes, we know: that’s quite a mouthful… that’s why it’s easier to just say CREAM, than go through that whole bit. In this new post series we will explore what this all means, and why we created an entirely new term.
Back when I first started CommunIT Solutions I used to use the term “customer” and “client” interchangeably. To me, they both meant “people who pay you money to do things”, so it was all good. Once I started blogging again, I figured I should have a better idea of what I’m talking about, if I’m going to presume to offer any kind of advice and guidance to others. So, of course, I Google-d both terms, and here’s what I discovered.
Client: The term client is derived from Latin clientem or clinare meaning “to incline” or “to bend,” and is related to the emotive idea of closure. It is widely believed that people only change their habits when motivated by greed and fear Winning a client is therefore a singular event, which is why professional specialists who deal with particular problems tend to attract one-time clients rather than regular customers.
Customer: Clients who habitually return to a seller develop customs that allow for regular, sustained commerce that allows the seller to develop statistical models to optimize production processes (which change the nature or form of goods or services) and supply chains (which changes the location or formalizes the changes of ownership or entitlement transactions).
So, for purposes of this series, a client is someone who is inclined to do business with you, usually in a “one and done” fashion, while a customer is one who becomes accustomed to doing business with you on an ongoing basis. And before you get started – yes; I realize that there are many places where you will see these terms defined to be the exact opposite. In other cases, a client is taken to be someone who hires the services of a professional, while a customer purchases hard goods from a store or organization.
We’re not going to argue with those definitions – I’ve chosen the meanings above because they fit with my overall model of client and customer relations, nothing more. The first time you do business with someone, they’re your client. Your goal in many (if not most) cases – and the point of this series – is to convert that client into a customer. So the first obvious question is “how do I do that?”
Well… that’s the reason I’m writing this series, and breaking it down by examining each aspect of the term CREAM. We’ve defined briefly what we mean by customer, and the difference between customers and clients. By this logic, there’s no such thing as client retention. We’ll look into why that is in Parts Three and Four, but in the next post, we’ll explore Customer Retention, and explain why that comes before Engagement or Acquisition – and it’s not just so that we can spell the word CREAM…
See you next week.