What is the Exact Difference Between Consumer and Customer
In this article, we look at the difference between Consumer vs Customer and why it matters to your business strategy. The terms, consumer and customer are often used interchangeably in a general context of purchase behavior. There is however a difference between the two, although they are closely related.
Consumer vs Customer
To put it simply, a customer is a person or entity who purchases a product. A consumer on the other hand is someone who consumes or uses a product, regardless of whether they made the purchase or not.
A customer will not necessarily be the end-user of the product they purchase. Let’s look at two examples.
A restaurant group purchases beef to make the dishes on their menu. Although they purchase the product, they are not the ones eating it. The product is purchased to sell in a cooked meal. Patrons order a meal at the restaurant and enjoy their beef dinner. They are the consumers of the product.
In the same way, a small grocery store may receive pie deliveries every day to sell. The store is the bakery’s customer since they purchase the pies but do not consume them. They purchase for resale purposes.
A man comes into the store, buys, and eats a pie. He is the consumer. If the man bought 2 pies for his children, he would be a customer and the children eating the pies would be consumers since they are the ones consuming the end product.
It is possible that the customer who buys the product sometimes also ends up being the consumer.
Why is the Consumer vs Customer Distinction Important?
From a business perspective, it is important to know who drives purchases and influences buying decisions.
Let’s consider the example of the restaurant (Example 1 above). The supplier tries to convince the restaurant chef (the customer) that their beef is superior quality, organic meat. The restaurant will then sell the product as a superior item on its menu. If a patron orders the meal and is happy with the product, he will tell his friends to try the dish at the restaurant. The higher the demand from the consumers ordering the meal, the higher the demand for the beef will be.
The beef supplier, therefore, knows that if they can convince the customer (restaurant) to purchase and promote their product, they can create a higher demand from the consumer (patron) for a full-circle supply and demand effect. If there is no demand from the consumer, the customer will not want to purchase the product since it will not count in their favor.
From this example we can gather that:
- The impact that a product or service has on a consumer makes or breaks the deal. The more consumers want it, the more customers will purchase and supply it.
- Only once a customer is lured to buy a product can it progress to the consumer in the chain.
- A good marketer will try to influence customers first. If a customer is truly sold on a product, they will in turn motivate consumer sales.
Every end-user in the chain of purchase is a consumer, however, consumers do not necessarily make the purchase. A consumer can receive an item as a gift. Even though they are the end-user or consumer, they did not make the purchase themselves.
A customer will not necessarily be the end-user of the product but they will make a purchase to attain it.
Understanding the difference between the two will assist in determining who the best target is for your product or service and develop the correct marketing strategy accordingly.
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