Although there is a big difference between customer development and marketing, there is still much confusion about these two concepts. This article will clearly show the difference between them (Customer development vs. marketing) and the reasons for the confusion.
Customer development vs. marketing: Marketing is oriented around executing a given plan and market strategy, while Customer Development is centered on discovering customer needs. That is why a startup uses Customer Development while an existing company uses Marketing.
This significant difference between “Customer Development” and “Marketing” jobs leads to discrepancies in the execution and the type of staff needed for each job. This article will show you these differences in-depth and explain the reasons for confusion.
Table of Contents
What is Customer Development? And what is Marketing?
To know customer development vs. marketing: First, let us define Customer Development and Marketing to see the differences and similarities.
Customer Development
The startup is a temporary company search for a business model. The Customer Development method is the process used to organize the search for the business model.
Customer Development accelerates the iteration cycle and maintains the cash, giving founders more chances to pivot, iterate, and succeed before the bank account dries up.
Customer Development focuses on listening to customers and discovering customer needs.
There are no sales, marketing, or business development departments when searching for a business model. If you have organized your startup with these sections, you are not doing customer development.
In a startup, sales and marketing activities are ad hoc and fuzzy and seldom have measurable goals.
One of the main goals of Customer Development is to discover a successful sales and marketing strategy and the steps to be used by the marketing team later.
To learn more about Customer Development, see the “How Startup Works” article.
We suggest the Free Training course How to Build a Startup for more details about the Customer Development method.
Marketing
Marketing is the process of developing and delivering value to potential customers. It includes every step you take to sell, service, and manage your customer relationship.
The Marketing department executes steps and strategies pre-prepared for this function.
Marketing is what you say and how you say it to explain how fantastic your product is and why people buy it.
The main differences between Customer Development and Marketing (Customer development vs. marketing).
- Customer development is used by a startup, while marketing used by an existing company.
- Marketing deals with a known strategy and procedures, while customer development deals with ambiguous and fuzzy processes and seldom have measurable goals.
- Marketing uses ready-made marketing and selling documents. While these documents are developed during Customer Development.
- We expect the marketing team to achieve sales. We expect the customer development team to get feedback from customers to modify the business model.
- The founder cannot delegate the customer development tasks; he must do it himself. But he can (should) delegate marketing tasks to others.
- Marketing tasks begin after customer development tasks are finished. Startups maintain cash during Customer Development by not hiring any sales and marketing staff until the founder finds the right business model.
- The nature of Customer Development is research and discovery. Marketing is about planning and implementation.
- The customer development team is driven by innovation and leadership, while the marketing team is driven by achieving sales.
These are the key points that illustrate the differences between Customer Development and Marketing. In the next section, we will show you some confusing issues between them.
Confusion points between Customer Development and Marketing.
Customer development and marketing confusion may have occurred because of some of the shared points between them. Here we will discuss some of them.
Strategies and steps of marketing and selling
In a startup, there are no strategies and steps for the marketing function. The goal of Customer Development is to discover these steps and strategies.
In existing companies, the marketing department implements the strategies and steps prepared in the startup phase. This is one confusing point between Customer Development and Marketing.
The idea of not having a functional organization until the organization has found a proven business model is one of the hardest things for new startups to grasp. There are no sales, marketing, or business development departments when searching for a business model.
If you have organized your startup with the sales and marketing departments, you are not doing Customer Development. This will cause significant harm to your company and often lead to failure.
Marketing Research
Another confusing point between Customer Development and Marketing is the marketing research function.
Market research is defined as the process of gathering, analyzing, and interpreting information about a market, product, customers, etc.
An existing company uses marketing research to monitor market changes that may indicate opportunities or threats.
Customer Development is much deeper, focusing on listening to customers and discovering customer needs.
Statistical and market research and a few customer interviews fuel an existing company’s evaluation and business plan.
Marketing research is excellent at looking at the past and analyzing the causes of success or failure.
Our advice, if the marketing research department of the existing company indicates there must be a fundamental change in the product, anticipates customer trends, or requests to produce new products, the company should build a customer development team for this task.
In a startup, you should never create a marketing team. The marketing team must be started by a customer development team directly.
Customer development accelerates the iteration cycle and maintains the cash, giving founders more chances to pivot, iterate, and succeed before the bank account dries up.
Finally, keep in mind that marketing research is more suitable for an existing company. Customer Development is more realistic for startups.
For more information about market research, you can refer to the article: Market research at Wikipedia.
Conclusion
Marketing is oriented around executing a given plan and market strategy. Customer Development is centered on discovering customer needs.
Customer Development is used by a startup, while an existing company uses marketing.
Marketing works with a strategy and steps already known, while Customer Development works with vague ideas.
Keep in mind that marketing research is more suitable for an existing company. Customer Development is more realistic for startups.
Our advice, if the marketing research department of an existing company indicates there must be a fundamental change in the product, anticipates customer trends, or requests to produce new products, the company should build a customer development team for this task.
We suggest attending the Free Training course How to Build a Startup for more details on this subject and related topics.
