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If Money Doesn't Change Hands You Can't Call A User A Customer
- rue 16y agoCorollary: if money changes hands, you can't call a customer a guest.
- brudgers 16y agoUnless you are a hotel.
- aberkowitz 16y agoIt's irrelevant what you call a user. Almost anything a user does with your app is helping you - whether it's consuming ads, talking about your product / service, or giving feedback.
- il 16y agoUnfortunately, vendors and employees don't yet accept payment in feedback.
- aberkowitz 16y agoIf you're bootstrapping a company that you cannot afford to bootstrap, then by all means, figure out how to bring in money ASAP. On the other hand, if you can afford to develop a loyal user base first, then that is your best path to success.
- run4yourlives 16y ago>On the other hand, if you can afford to develop a loyal user base first, then that is your best path to success. Assuming you don't define success as "stable and profitable company", I suppose it is.
- aberkowitz 16y agoI apologize if the meaning of my prior comment was misconstrued, as you have not reached my intended conclusion. I'm intending to say that building a user base should come before monetizing - not replace it.
- jonhendry 16y ago"Almost anything a user does with your app is helping you" Like a rancher is helped by docile livestock. But the relationship between the rancher and the livestock is very different from that between the rancher and the actual customer.
- marssaxman 16y agoThis is one reason it irritates me when airlines call their passengers "customers".
- skmurphy 16y agoPassengers pay, they should be called customers.
- marssaxman 16y agoTypically, my employer was the customer, and I was the passenger.
- artmageddon 16y agoWhat should they be called instead? insert joke about currently being called "cattle"
- BrainScraps 16y agoI think you could better apply this logic to TSA. But with TSA, something more important than money is being "handed over"
- vessenes 16y agoMy first thought on reading the title: "Ah, Google, the company with no customers.."
- skmurphy 16y agoGoogle's customers are the companies that buy their ad space.
- vaksel 16y agoTheir customers are advertisers + they have a ton of premium products
- run4yourlives 16y ago1. Invoking google (the outlier of outliers) at anyone trying to make an otherwise valid point is like a special Godwin's Law for startups. 2. Google is also a monopoly. If you are blessed to be in such a position, almost nothing you read applies.
- jonhendry 16y agoGoogle's customers are the advertisers. The end users are Google's product.
- nlavezzo 16y agoThis piece is clearly talking about an enterprise sales model, and because of that I think his point about taking extremely low amounts of money for first customers requires a word of caution. In our experience at our last company, which was an enterprise software company selling a powerful data analytics platform, almost ALL of the customer negotiations at all stages of the business involved "Most Favored Nation Pricing" clauses - as in, the customer wants to know that no other customer has gotten a better deal. This can be subject to fixed volume discounting, etc. - i.e. someone buying 50 licenses prior to the currently contemplated sale of 20 licenses could have paid less. However, try telling a potential customer that someone previously paid less for the product they're thinking of buying and at a minimum you'll have a hold-up of months of red tape as they get an exception to their purchasing checklist authorized. These corporate purchasing processes are highly inflexible and often imposed by Sarbanes Oxley "internal controls" measures (meaning they're dictated by outside auditors, and not up for discussion) - they are real and need to be factored into pricing strategy. A good workaround we found is this: make your early licenses have some type of specific restriction or obligation that you will relax in the different class of licenses you will sell later in the company. You might restrict early licenses to dealing with a certain type of data, or you might even add the obligation of participating in a "marketing case study". Do something along those lines (and get it actually written into the contract) so that in the future, you can with good conscience sell less restricted licenses at a higher price point under the inevitable MFN clauses you'll get with Enterpise software sales.
- skmurphy 16y agoI would not worry about special restrictions in your first license, you need to close the deal and establish an ongoing and mutually beneficial relationship. You will learn more about what features your product really needs from your first few customers that it will naturally evolve so that you are selling a different product to later customers asking for MFN. There are many ways to legitimately neutralize/minimize MFN, focus on making your early customers successful.
- Yaa101 16y agoYou call that user a product!