Although there is a big difference between customer development and marketing, there is still much confusion about these two concepts. This article will show you exactly 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 start-up uses Customer Development, while an existing company uses Marketing.
This large difference between “Customer Development” and “Marketing” jobs leads to a discrepancy 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.
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 between them.
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 that gives 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 you are searching for a business model. If you have organized your startup with these sections, you are not really 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.
For more details about the Customer Development method, we suggest the Free Training course How to Build a Startup.
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 when you want to explain how awesome your product is and why people should 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 confusion points between them.
Confusion points between Customer Development and Marketing.
The confusion between Customer Development and Marketing 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 that were prepared in the startup phase. This is one confusion 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 you are searching for a business model.
If you have organized your startup with the sales and marketing departments, you are not really doing Customer Development. This will cause great harm to your company and often lead to failure.
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 the evaluation and business plan in an existing company.
Marketing research is great 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 that gives 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
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 marketing is used by an existing company.
Marketing works with a strategy and steps already known, while Customer Development works with fuzzy 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.
For more details on this subject and related topics, we suggest attending the Free Training course How to Build a Startup.
- How To Describe Your Business Model?
- What Are The Business Model Metrics? How Do You Evaluate Any Business Model?
- What Is The Business Model Life Cycle?
- 5 Reasons Why Customer Development Must Be Done By Founders?
- How Startup Works and How to Run Startup?
- When To Use the Business Model Canvas?
- Why Do You Need The Product Market Fit?