Difference Between Customer and Consumer

Marketing and advertising include many words that can be difficult for common people to understand. Likewise, many people think that the word Customer and Consumer have a similar meaning, but they have a different meaning from the marketer’s viewpoint, though they sound similar. There are various situations where we can understand that the customer and consumer can be the same person, but these words altogether have a different meaning.

Every human being on earth is either a consumer or a customer, in some way or the other and they are commonly misunderstood. However, a consumer is someone who consumes or uses the goods, and the customer is someone who purchases the commodity and makes the payment. 

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Sometimes, both the customer and consumer, are the same individual, when an individual buys good for their personal use. However, they are not similar, therefore, this article will help you understand the difference between the two. All the marketing processes are aimed towards influencing customers’ behaviour, which means to influence the customer so that they take desired action expected by marketers. 

Another important feature in the discussion between consumer vs customer is that customers can also be businesses that purchase and then resell goods or merchandises. In such concern, they are only customers and not consumers of the goods they buy because they are reselling it to the consumer to ultimately utilise the product. So let’s understand in this article what are the points that make the word customer and consumer different from each other.

Who is a Customer?

A customer is a person who buys goods and services regularly from the seller and pays for it to satisfy their needs. Many times when a customer who buys a product is also the consumer, but sometimes it’s not. For example, when parents purchase a product for their children, the parent is the customer, and the children are the consumer. They can also be known as clients or buyers.

Customers are divided into two categories:

• Trade Customer- These are customers who buy the product, add value and resell it. Like a reseller, wholesaler, and distributor, etc.
• Final Customer– These are the customers who buy the product to fulfil their own needs or desires.

Further, according to an analysis of the product satisfaction and relationship with the customers, the customers are divided into three kinds-

• Present Customer
• Former Customer
• Potential Customer

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Who is a Consumer?

A consumer is someone who purchases the product for his/her own need and consumes it. A consumer cannot resell the good or service but can consume it to earn his/her livelihood and self-employment. Any person, other than the buyer who buys the product or services, consumes the product by taking his/her permission is categorized as a consumer. In simple word, the end-user of the goods or services is termed as a consumer.

All individuals who engage themselves in the economy is a consumer of the product. For instance, when a person buys goods from a grocery store for their family, you become a customer, as you are only purchasing the commodities. But, when they feed the grocery to other members of the family, they become the consumer.

Given below in a tabular column are the difference between Customer and Consumer.

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Types of Customers

In business, customers play a vital role. In fact, customers are the actual boss and responsible for a company to make a profit. A few different types of customers are:

• Loyal Customer- They are less in numbers but increase more profit and sales as they are completely satisfied with the product or service.
• Discount Customers- They also regular visitors but buy when they are offered discounts or they purchase only low-cost goods.
• Impulsive Customers- These types of customers are hard to convince, as they don’t go for a specific product, but buy whatever they feel is good and fruitful at that particular point of time.
• Need-Based Customers- These customers buy only those products which they are in need of or habituated with.
• Wandering Customers- These are the least valuable customers as they themselves don’t know what to purchase.

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Types of Consumers

A service or product producing firm has to recognise different types of consumers when they target them with its product to gain profits. Some of the different types of consumers are:

• Commercial Consumer- They buy goods in large numbers whether they need the product or not and sometimes associate special needs with their purchase orders.
• Discretionary Spending Consumers- They have unique buying habits and purchase a lot of clothes and electronic gadgets.
• Extroverted Consumer- They prefer brands that are unique and become a loyal consumer once they gain that trust as a customer.
• Inferior Goods Consumer- Consumer having low-income buy goods having low price.

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Why consumers are important?

The importance of consumers in various avenues is presented below:

1. Encourage Demand- They are the main root for the demand of any product.  All manufacturers of goods and services produce various things according to the demand in the market. 
2. Create Demand for Various Products- Different consumers have several varieties of demand or an individual consumer can also demand various types of goods. These encourage the manufacturer to deliver various products in the market.
3. Increase Demand for Consumer Goods- It creates demand for various consumer goods, like long-lasting, semi-durable and biodegradable goods. 
4. Enhance Service Diversification – Consumers not only utilise different types of products but also use diversified services to support the standard of living. Such as educational service and health service, transport and communication service, and banking and insurance service, etc. This will direct the development or improvement of the service sector in the economy.

The above mentioned concept about ‘Difference between Customer and Consumer’ is given in detail for Commerce students. To know more, stay tuned to BYJU’S.