I wrote a thing for class that appears on the class blog: http://launchingtechventures.blogspot.com/2013/02/death-of-customer.html . My classmates have written a bunch of intelligent stuff there, too.

Here’s my post copied below:

Death of the “Customer”

I’m really worried about this word.

Dictionary.com (above) seems to grasp what many tech founders conflate: the word “customer” can describe two very starkly different relationships. There’s a customer as someone you sell to, and a customer as someone you “deal with.” The site even highlights the critical differentiator for its vexed readers: Informal.

Perhaps, to be on the safe side, the word “customer” should be rejected out of hand in discussions of modern tech businesses—particularly those establishing multi-sided platforms, and most especially those in which one side of the platform is serviced completely for free.

For example: As an individual, I am with quite certainty NOT a “customer” of Facebook. I don’t give them money for anything. I don’t buy the gift cards, or the Farmville tokens, or click the ads, or anything. (I suppose, you might argue, that in this instance Dictionary.com’s “tough customer” moniker would actually be quite appropriate).

As far as Facebook is concerned, I am a user. In another lens, I might even be considered one small part of Facebook’s product, which it sells to its actual customers: advertisers, Zynga, data miners, and the like.

I think our discussion of the Aardvark case reached the right solution, but perhaps arrived there with entirely the wrong focal point. We agreed that Aardvark failed to achieve product-market fit, and talked about how despite the founding team’s best efforts in lean methodology, the resulting product never truly seemed to gel with its intended customer user demographic. Little energy seemed to be exhausted in resolving the product-market fit among the company’s actual customers: its advertisers. I don’t mean to stir a debate as to whether ads should have been implemented sooner or later. I mean to address the notion that it was never truly determined whether the product (the user base) and medium (Aardvark) being created would be desirable for potential purchasing clientele, and differentiated enough to be appealing in a market already saturated with a litany of advertising mediums.

Plastiq, through all its efforts to strike new business, seemed to have some better understanding of this notion. It sent sales reps across the country to try and strike deals with car companies. Not a single bite. There was a backup plan, luckily, and the company changed gears and eschewed the dealers as a customer base. Imagine if, on the other hand, Plastiq had focused exclusively on making a really nice, flashy, convenient, interface for individuals looking to buy new cars with their credit cards (these are the “customers,” right??), and only approaching the auto dealers after developing some fanbase. They’d be dead on arrival.

Let’s kill the word customer and avoid whatever confusion it seems to be causing. From now on, it’s “buyers” who spend money and “users” who don’t.