As both words indicate a cause for action; they are often used interchangeably. May this be a simple guide that helps you choose between them.
Motivation is an external influence – typically from a person with authority or power. In marketing; we often use tactics like discounts, sales, gift-with-purchase, and loyalty programs to motivate customers to buy more, or buy sooner. In leadership settings, it is common to motivate with fear – loss of status or employment if a particular task is not completed – as well as with incentives – surpass quota and receive a financial bonus.
I like to describe motivation as lighting a fire underneath someone. While it is effective; the motivated behavior is often temporary. In sales, it is easy to monitor and track a spike followed by a dip. Other human behavior is similar, but not as easily tracked.
Inspiration on the other hand is an internal drive towards something. It is a self-contained idea that impacts people on a deeper level – a passion, a calling. Artists of all sorts talk about what inspires them to create their works. It is easy to see this in design and creation of new products or businesses. And, the first people to begin purchasing the goods talk about being inspired to purchase; as well as inspired to share the experience.
I like to describe inspiration as lighting a fire within someone. It is about connecting them with tools, ideas, and support that they can make a difference. Allowing them to use their creativity and imagination to results in long-term impacts that might be measured in decades, entire careers, or lifetimes. Inspiration is also amazing in that it can be done over great distances (geographic or time). Someone can read a book that was printed hundreds of years ago, and dedicate their life to a single idea contained within that book.
In all aspects of human behavior, it is critical to remember that humans are complex creatures with individual personalities. They need to be treated as such.