Client vs. Customer: What Are the Differences?

You’ve probably heard the words client and customer used interchangeably. When it comes to everyday language, we treat these words as synonyms without even thinking about it.

But do they actually mean the same thing when it comes to the business world? Is there a significant difference between a client and a customer that we should be aware of? Are we making a grave mistake by treating them as equals? We’ll explore this matter in this article.

What is a Client?

A client is an individual, organization, or entity, who hires a service provider to deliver certain services. For example, a client is a business that hired a law firm to oversee the legality of documents and contracts or a person who seeks advice from a finance advisor on investing their savings.

A client typically seeks expertise, advice, or tailored solutions from the service provider. This partnership often involves engagement, trust, and commitment to achieving long-term goals.

Characteristics of Clients

1. Long-term relationships - Clients are involved in long-term relationships with service providers. This engagement helps businesses better understand the client's needs and adapt to changing requirements.
2. Strategic partnership - Service providers work closely with clients, offering expertise, advice, and solutions that contribute to the client's success, growth, or problem resolution.
3. Customization and personalization - Clients expect that service providers tailor their offerings and support options to meet their specific needs, preferences, and objectives.
4. High level of trust - Trust is a cornerstone of relationships with clients. They rely on the expertise and reliability of the service provider, often entrusting them with crucial aspects of their business or personal affairs.
5. Continuous communication - Communication with clients is regular and continuous to ensure that service providers meet their expectations and answer every need.
6. Continuous payment - Clients often engage in a continuous payment model rather than a transactional one. They pay for the constant value they receive over time, rather than a single service.
7. Professional services sectors - The term "client" is frequently used in professional services sectors such as legal, financial, consulting, and creative services.

Client-based businesses

Below you can find a list of businesses that typically engage in long-term relationships with their clients:

• law firms
• marketing and advertising agencies
• public relations agencies
• financial advisory firms
• consulting companies
• insurance agencies
• architectural companies
• accounting firms
• real estate agencies

What is a Customer?

A customer is a person, business, or organization that buys products or services from another business. The nature of the relation is transactional and singular, focused on the direct exchange of goods or services, without the expectation of a long-term partnership.

Customers make individual purchases, and their interaction with a business is rather sporadic, with each transaction considered to be independent. For example, a customer is a person buying clothes or kitchen utensils from a business that specializes in retail, or e-commerce.

Characteristics of Customers

1. Short-term interactions - Customer’s interactions with businesses are short-term and occur as needed or desired by the customer. They can walk into stores and leave as soon as they finalize their purchase, without engaging with business for too long.
2. Transactional nature - Customers engage in one-off transactions since they want to immediately fulfill their specific needs or desires without a long-term commitment.
3. Price sensitivity - Customers often prioritize competitive pricing, looking for affordable and cost-saving solutions. The price is often the defining factor influencing their purchasing decisions.
4. Convenience and accessibility - Accessibility and convenience play a crucial role for customers, influencing their choice of businesses and products. Online presence, location, and ease of access are key factors for customers who prioritize convenience.
5. Impulse buying - Customers may buy things on impulse, making unplanned purchases driven by emotions, or promotional offers.
6. Limited brand loyalty - Brand loyalty among customers is generally lower compared to clients. Customers may switch between brands based on factors like price, convenience, or promotions.
7. Immediate satisfaction - Customers focus on immediate satisfaction that comes from the product or service. The long-term effects are less important to them.
8. Retail and e-commerce focus - The term "customer" is commonly associated with retail and e-commerce, where the interaction is short and direct. Customers are buying products or services without worrying about an ongoing commitment to certain businesses.

Customer-based businesses:

Below you can find a list of businesses that typically engage with customers in one-off transactions:

• retail shops with clothing, cosmetics, art supplies, etc.
• e-commerce shops
• restaurants and cafes
• mechanics
• nail and hair salons
• massage parlors

Customer vs. Client: A Comparative Analysis

The table below summarizes the differences between clients and customers. From the ongoing, collaborative nature of client partnerships to the transactional, one-off interactions with customers, this overview is a practical guide for anyone who wants to understand the key differences between clients and customers.

The main difference between a client and a customer lies in the nature and duration of their relationships with businesses. Clients engage in long-term, collaborative partnerships characterized by a high level of trust and customization, strategic commitment, and ongoing communication. Customers, on the other hand, participate in transactional, one-off interactions, prioritizing immediate satisfaction, price sensitivity, and varied payment methods.

Optimizing Client and Customer Management with Creatio CRM

Creatio stands out as an exceptional solution for effectively managing relationships with both clients and customers. This platform excels in automating the entire client and customer journey, offering feature-rich products for marketing, sales, and service automation. Its robust business process management (BPM) engine seamlessly automates client- and customer-facing workflows, ensuring a streamlined experience.

The no-code nature of Creatio empowers organizations to swiftly build client- and customer-centric structures. It allows you to adapt to evolving needs by optimizing CRM workflows, creating applications without coding, and utilizing AI/ML for strategic insights. The unified architecture enhances productivity and collaboration across all Creatio CRM products, fostering a cohesive environment through a shared database and multi-team data processing workflows.

Creatio's versatility extends across various industries and businesses, irrespective of size or sector. Whether in professional services, finance, retail, or any other industry, the robust features of Creatio contribute to enhanced client loyalty, increased customer satisfaction, and optimized business processes. In essence, Creatio emerges as a comprehensive solution, transforming the management of client and customer relationships for the better.