Users Not Customers

This week we’re considering the concept of Users Not Customers as defined by Aaron Shapiro, CEO of Huge. This is not a new concept – you might remember the story of the customer who returned a set of snow tires to Nordstrom – despite the fact that Nordstrom doesn’t sell tires. He was treated as a user rather than a customer. Read on.

First be careful not to get hung up on semantics like Jack Dorsey of Twitter seems to be. Dorsey is correct in pointing out that the term made it’s first appearance in computer parlance at the dawn of shared terminals and was solidified in hacker culture as a “non-technical” person – or ‘luser’. However this is ancient history and the term has evolved. Regardless, Dorsey is convinced the term is derogatory and has demanded that it not be used at Twitter – replaced with customers or buyers. From what i can tell, he’s alone in this but it’s worth mentioning.

For our purposes, a user is anyone that comes in contact with, is a fan of, works for, is a past customer of, or is a current customer of some product or company. So, customers are a small subset of the total user population. In Shapiro’s book ‘Users Not Customers’ he takes a similar approach to ‘Good to Great’ by Jim Collins making his point through research and examples. Here is a set of 100 companies, they are succeeding because of x – where x is some example of delivering value to their Users rather than just to their Customers. Forget the science, I just want to knock around the core philosophy of catering to the larger group rather than those who directly effect your bottom line.

First let’s consider two obvious examples of successful User-first companies – Facebook and Google. Both huge, both changing the world, everyone knows exactly what they do and everyone wants to work for them. But what do they sell? Do you pay for the convenience and utility of Google or the fun and informative communication of Facebook? Of course not, you’re a user. These companies focused on the user first and foremost and the cash followed. In this case the customers aren’t the users – they are the advertisers. You might say, this is different, these are phenomenons – or maybe this is easy with a service based company, what about selling widgets?

Okay, check this out. When I worked for Saatchi and Saatchi back in the aughts, our NYC building didn’t have a proper digital audio studio. The Music Director needed an easy way to mock up commercial demos without sending it out to our editing house. Since I had some experience in this area I volunteered to help, we ran down to Sam Ash and started shopping. He went straight for a Pro Tools setup as was the industry standard at the time – cost about ten grand. I suggested buying a simple PC and a copy of Cubase (made by the German company Steinberg). Cubase was the way to go as it was cheaper, would work with any hardware and did exactly what he needed. Plus, I’d been using it for years and loved Steinberg as a company. If I ever had an issue they answered emails quickly, they spent thousands creating and curating user forums for people to share ideas and help each other fix problems, they would sponsor electronic music festivals and give away software and they gave ridiculous discounts to students – which is how i got my copy.

Fast forward three years, the Music Director is now a believer in Cubase based on the product itself but also based on an interaction that his son had with the company. The kid had set up a home studio based on software called “Fruity Loops”. No Cubase in site. Kid asks a sonic processing question that the dad can’t answer and guess who he suggests they call. From what i remember the kid says something like “hey my dad uses Cubase and i think it’s cool but i’m using FL for my studio, can you help me with the processing of my kick drums?” He wasn’t calling as a customer, his dad hadn’t even purchased anything form them in years and had no plans to. The kid called as a so called ‘fan of the product’ or simply ‘someone that had come in contact with the product’. Seems crazy, no?

One more year goes by and Saatchi is building a million dollar in-house studio. Guess what’s on every computer? Nuendo. Wait what? Not Cubase? Well Neuendo was Steinbergs flagship new product for professional studios. At this point a Nuendo setup cost about as much as an equivalent Pro Tools rig so the cost advantage was gone – but the treatment that the stakeholders had gotten over the years converted us from users back to customers when the time came. We couldn’t wait to give them our money.

So why is this different than plain old good service? It is, of course that, but it’s more. Imagine taking your Corolla to the dealer and asking them to help you get to work quicker or how to avoid streaky dog nose marks on your windows. That’s really what we’re talking about here. Often when I personally called or emailed Steinberg, they ended up helping me with something wholly unrelated to their product. Maybe it was a hardware driver not communicating with my audio hardware, or maybe it was a third party plug-in shitting on the Cubase audio sub-structure. Regardless, I was using their product, they wanted to help and I appreciated the hell out of it. Cubase was one of a dozen programs on my studio computer but the only true user relationship that I’ve ever had was with Steinberg. That’s true to this day. Appreciated, remembered and rewarded -of course. Worth it to Steinberg over the long term? Not sure. The future of retail? That would be a miracle. One thing is clear – via their commitment to users rather than customers Steinberg gained a loyal fan base inside the world headquarters of a huge NYC ad agency without even knowing it or spending any money. Powerful stuff.

Originally written while working at Akavit – used with their permission.

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