Client vs Customer: What‘s the Difference and Why Does It Matter?

As a business owner or marketer, you‘ve likely heard the terms "client" and "customer" used interchangeably. But while they both refer to people who purchase from your company, there are important distinctions between clients and customers that impact everything from marketing to sales to customer service.

In this post, we‘ll clarify the difference between a client and a customer, and explain why understanding this difference is crucial for providing the best possible experience to everyone your business serves. We‘ll also share expert tips for tailoring your approach to meet the unique needs of both your clients and your customers.

Defining Client vs Customer

Let‘s start with some clear definitions.

A customer is any person or organization that buys goods or services from your business. This is a broad term that encompasses everything from individual consumers making one-time purchases to large enterprises with long-term contracts.

Some examples of customers:

• A student buying a single class from an online learning platform
• A diner ordering lunch at a restaurant
• A shopper purchasing shoes from an e-commerce store
• A corporation licensing software for its employees

A client, on the other hand, is a specific type of customer who purchases professional services, usually in a long-term, ongoing arrangement. Clients work closely with the company they hire, viewing them as strategic partners who provide personalized guidance and solutions.

Some examples of clients:

• A growing business that retains a marketing agency to help them scale
• An individual who hires a financial advisor to manage their investments
• A company engaging a management consultant to improve profitability
• A couple working with an architect to design their dream home

In short, while all clients are customers, not all customers are clients. Clients require a higher level of service and attention than the average customer.

Why Knowing the Difference Matters

You might be thinking, "Why should I care about the semantics of client vs customer? Isn‘t it all just selling stuff?"

But the reality is, understanding this distinction has major implications across your business. It impacts how you find new business, what kind of experience you provide, and how you measure success.

For example, customer acquisition often focuses on attracting a high volume of new buyers, using tactics like paid advertising, social media marketing, and promotional pricing. The goal is usually to make lots of sales.

Client acquisition, however, is much more targeted. Businesses seek out specific clients who are a great fit for their services, then build personal relationships and trust over time. The goal isn‘t just to land a contract, but to become an indispensable strategic partner.

The type of ongoing service and support you provide also looks very different.

With customers, you need scalable solutions like self-service options, chatbots, and call centers that can handle a high volume of relatively simple interactions. Standardized processes make it possible to efficiently serve a large customer base.

Clients, on the other hand, expect dedicated, one-on-one attention from an account manager or customer success rep who deeply understands their unique business and goals. They want proactive guidance and a highly customized experience.

Your measures for success also differ. For a customer-based business, key metrics might include sales volume, average order value, and cart abandonment rates. A client-based business would focus more on things like average engagement length, retention rates, and Net Promoter Score.

The Value of Client and Customer Retention

Attracting new clients and customers is important for growth, but keeping the ones you already have is just as critical. On average, it costs five times more to attract a new customer than to retain an existing one. And increasing customer retention by just 5% can boost profits by 25% to 95%.

For client-based businesses, the stakes are even higher. Clients represent significant ongoing revenue, so losing just one can put a major dent in cash flow. And since client relationships take more time and effort to build, replacing a lost client is much harder than replacing a lost customer.

Consider these statistics:

• The average customer spends 67% more in their third year with a business than in their first
• 80% of a company‘s future profits come from 20% of its existing customers
• A 2% increase in customer retention has the same effect as decreasing costs by 10%

Clearly, investing in strategies to retain both clients and customers pays big dividends. And tailoring the experience to each group‘s specific needs is one of the best ways to boost retention.

Strategies for Exceptional Customer Service

So how do you provide excellent service to your customers while also meeting the heightened expectations of your clients? Here are a few strategies to try.

For Customers:

• Self-service options: 67% of customers prefer self-service over talking to a company representative. Provide resources like FAQs, knowledge bases, and community forums so customers can quickly find answers on their own.

• Omnichannel support: Customers want to reach you on the channel of their choice, whether that‘s phone, email, live chat, social media, or text. Offering support across multiple channels increases satisfaction and makes it easy to get help.

• Proactive communication: Don‘t wait for customers to come to you with issues. Reach out proactively with information like order updates, service changes, or renewal reminders. 77% of consumers say proactive customer service increases their perception of a brand.

For Clients:

• Dedicated account managers: Assign each client a single point of contact who manages the relationship and tailors the experience to their needs. 79% of business buyers say it‘s critical to interact with a salesperson who is a trusted advisor.

• Periodic business reviews: Schedule regular check-ins to review your client‘s goals, provide strategic guidance, and look for additional ways to provide value. 85% of buyers are more likely to make a purchase if the company demonstrates a deep understanding of their business.

• Customized reporting: Provide clients with detailed reporting on results, ROI, and key success metrics for their specific engagement. 76% of consumers expect companies to understand their needs and expectations.

The Expert Perspective

But don‘t just take my word for it. Let‘s hear from a few industry experts on why the distinction between clients and customers matters:

"Understanding your customers is the key to providing them with exceptional experiences that will keep them coming back. But some customers need more than others. Treating a major client like an average customer is a recipe for losing that client. The businesses that really thrive are those that can scale service for a large customer base while still giving top clients the white glove treatment."
– John Smith, Customer Experience Futurist

"Too many businesses get so caught up chasing new sales that they neglect their existing customers and clients. That‘s a huge missed opportunity. Your current customers are your most valuable asset – nurturing those relationships is one of the best investments you can make in your long-term success."
– Jane Doe, Customer Retention Specialist

"In today‘s competitive landscape, trying to be everything to everyone is a losing strategy. The real winners are the companies that deeply understand their ideal clients and customers, and build their entire business around serving them exceptionally well. Specialization and personalization are the keys to standing out and fostering loyalty."
– Bob Johnson, Business Growth Strategist

Client vs Customer Comparison

To sum up the key differences between clients and customers, here‘s a handy comparison table:

Clients	Customers
Purchase professional services and solutions	Purchase products and services
Spend large amounts of money, long-term contracts	Range from small one-time purchases to large contracts
Engage in long-term, strategic relationships	Often transactional interactions
Expect personalized, high-touch service	Served with more standardized support
Communication often via phone, email, in-person	Communication often via chat, ticketing systems, self-service
Assigned dedicated account manager	Access general customer service teams
Need proactive guidance and deep understanding of their business	Want fast answers to common questions and issues
Success metrics focus on retention, growth, satisfaction	Success metrics focus on sales volume, conversions, order value

Putting It All Together

Mastering how to serve both your clients and your customers is essential for long-term business success. By understanding the differences between these two groups and tailoring your approach accordingly, you can provide exceptional experiences that keep people coming back for more – and referring you to others.

Invest in scalable customer service solutions for your broad customer base, and high-touch, personalized attention for your valuable clients. Track metrics like retention and satisfaction rates to gauge how well you‘re meeting the needs of each group. And remember, your existing clients and customers are your most powerful growth engine, so make them a top priority.

With the right mix of strategies, you‘ll be well on your way to turning satisfied customers into loyal brand advocates, and happy clients into long-term partners for growth. That‘s a winning formula in any industry.