Who is your customer

A silly question you might think. Of course we know who our customer is.  But within B2B, if you take a closer look, the answer is often less straight forward than you think.

Many B2B companies sell their products to companies that use it to make something new, either as a raw material or as a technical component of a larger solution.

So most companies automatically answer the question on who is the customer, with the answer that the companies paying the bills are the customers. But are they?

Well, in some cases they are, but in other cases, the companies paying your invoices are merely a channel, a route to market to the ultimate customer. This may be somewhat confusing to some of you, so let me clarify.

Imagine you are a manufacturer of a very specific water repellant fabric. Are you customers the people that make clothes of your fabric and pay the bills, or are your customers the people that wear the clothes made out of your fabric.  For most textile manufacturers it are the clothing manufacturers, but the people at Gore, who brought Gore-Tex to the world, are convinced it are the people that wear the clothes.

Another example on the duality of my original question; Imagine you are a chip manufacturer, are your customers the motherboard manufacturer, who pay the bills, the computer manufacturers, who buy the motherboards, or the customers who use the computers.  Different answers are possible, but Intel believes it is the people that use the computers.

So how to answer this question for your own company? The answer is more straightforward than you think.  Follow who benefits the most from your unique selling proposition, the core value you bring.

Is this the company that buys and processes your material, than this is your customer. If it is somebody further down the value stream or even the ultimate end-users, than they are your customers and you should consider engaging with them directly.  If you play this right, there is a strong opportunity for growth there and the possibility to get premium prices for your offer.