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Do you consider yourself to be an average person? If yes, would you say you are the same to another average person? In a spectrum of incremental differences, would you consider a band of such differences being one and the same?
Imagine you have a bucket of yellow paint and you keep adding tiny portions of blue paint progressively, until the paint in the bucket is now green. Let us say, for the shake of the argument, it took 1000 additions of these tiny portions to turn the bucket green. Would the colour after the 512th addition of blue be the same as after the 513th addition? Most probably It would look the same. How about the 512th and 713th steps? Probably not.
Averages assume a statistical middle at best, or a stereotypical middle at worst.
In the context of people, when thinking of averages, we take a wealth of individual characteristics, behaviours and circumstances from a range of individuals and we attribute the most common ones to a single person, the average user. But all the above when combined and attributed to a single person can sometimes be conflicting, negate each other, or even culminate in entirely new situations.
What exactly happens when a designer designs for the average? This approach excludes by default the significant minority occupying the edges of the spectrum while assuming there are no differences between everyone in the middle range of the spectrum. Now the experience is good for almost no one.
What to do instead of designing for the average, you ask? Design for the individual! Unfortunately there are no shortcuts to this. Defining users and getting to know them as much as possible is quite crucial. The more intimate you get with them, the more insights you will gain on their problems, pains and gains, and the more useful and usable your design solutions will be. Primary user research and personas can go a long way towards achieving this goal. And even if the goal is not fully met, it is certain you will be travelling towards the right direction.