Do you know the fact that we all are consumers in some way or the other, no matter what our age, gender, race, caste, community is. The consumer is the one who consumes the goods, i.e. the user of the goods. It is commonly misconstrued with the term customer, which refers to a person who buys the goods or commodity and pays the price for it.
Each and every marketing activity is directed towards influencing the behavior of customers, i.e. to induce them in such a way that they take an action intended by marketers. So, customers are regarded as the king of the business.
In the business world, these words are used scores of times in a day and most of the time they are used interchangeably. There are instances when customer and consumer, both are same persons, meaning that when a person purchases goods for his/her personal use. But they are not one and the same thing, they carry different meanings, so take a read of the given article to understand the difference between the two.
Content: Customer Vs Consumer
|Basis for Comparison||Customer||Consumer|
|Meaning||The purchaser of goods or services is known as the Customer.||The end user of goods or services is known as a Consumer.|
|Resell||A customer can be a business entity, who can purchase it for the purpose of resale.||No|
|Purchase of goods||Yes||Not necessary|
|Purpose||Resale or Consumption||Consumption|
|Price of product or service||Paid by the customer||May not be paid by the consumer|
|Person||Individual or Organization||Individual, Family or Group of people|
Definition of Customer
By Customer, we mean a person who buys the goods or services and pays the price thereof. The word customer is derived from the term ‘custom’ which means ‘practice’, so the word customer means the individual or entity who purchases product or services from a seller at regular intervals. It can also be known as client or buyer. They are divided into two categories:
- Trade Customers: The customers who purchase goods in order to add value and resell them. These include Manufacturers, Wholesalers, Distributors, Retailers etc.
- Final Customer: They are the customers who purchase it either for their own use or to hand over it to the final user.
The customers are regarded as the king, in every business because they help in earning revenue. The businesses focus on converting shoppers into buyers. They also try to maintain a good relationship with the customers in order to keep the business going. Below given are the three kinds of customers:
- Former customers or ex-customers
- Existing customers
- Prospective customers
Definition of Consumer
We define consumer, as a person who is the end user of the product. The word consumer is made from the word ‘consume’ which means ‘to use’. In this way, the word consumer means a person who purchases the product or service for his own use or consumption.
As per the Consumer Protection Act, 1986, it does not include the person who purchases the commodity for the purpose of adding value or resale for any commercial purpose. However, a person can use those goods or services to earn livelihood or self-employment. Any type of user, other than the buyer who purchases goods, consumes the goods by taking permission of the buyer will also come under the category of Consumer. It includes the person who avails the services for any consideration. Moreover, the beneficiary of such services will also be regarded as the consumer. There are three Consumer protection council in India:
- At national level: Central Protection Council
- At state level: State Protection Council
- At district level: District Protection Council
Key Differences Between Customer and Consumer
The fundamental differences between customer and consumer, in marketing are described below:
- The person who buys the goods or services from a seller is known as the Customer. The person who uses the goods or services is known as a Consumer.
- The customer is also known as buyer or client whereas the Consumer is the ultimate user of the goods.
- The customer can be an individual or a business entity while a Consumer can be an individual or a family or a group of people.
- Customer pays the price of the product or service however he may recover it from the other party, in case if he had purchased it on behalf of any person. Conversely, Consumer not necessarily pays the price of the product, like in case the goods are gifted or if they are purchased by the parents of a child.
- The customer purchases the goods for the purpose of resale or to add value or for his personal use or on behalf of another person. In contrast to Consumer, who purchases the goods for the purpose of consumption only.
So from the above discussion, it is clear that the person who is a customer is not necessarily a consumer and vice versa. Now, it is a big question for many marketing executives to whom they focus on a customer or a consumer?
Enterprises must focus on the two as they should take care of what is demanded of the product by the consumer as well as they should advertise the product so well that it will grab the attention of the millions of customers instantly because the buying decision is taken by the two together or by keeping in view of the other. So, the companies should give equal importance to both.