A consumer is any entity (group or individual) that purchases a product or service for end consumption and not for any commercial purpose, such as for resale or manufacturing another product. End consumption could mean personal usage or use by family members, friends or relatives. If an individual buys a good on behalf of another individual, the end user is the consumer and the person who bought the good is the customer or buyer. For example, parents (customer) buy toys for their kids (consumer).
There are also instances when a person buying a good for commercial reasons, such as earning a livelihood, could be termed as ‘consumer’. For example, if a farmer buys a tractor, he is a consumer. But if he rents out the tractor to another farmer, then he is not the consumer of that particular tractor. The consumer may pay for the goods in full, make partial payments, or even buy items on credit.
Types of Consumers
There are different types of consumers – usually categorized based on their preferences, buying frequency, behavior, etc. Loyal consumers are the most sought after by companies. These consumers could be loyal to a brand or multiple brands in different product categories. A seller’s loyal consumer base is usually the smallest, but they are the most important set of consumers as they generate maximum business.
Then there is the ‘discount consumer’ who is constantly on the lookout for discounts while shopping. These consumers may also be loyal to some brands but they are the easiest to switch over, in case a competitor brand offers goods at attractive discounts. Consumers can also be impulsive with their purchases. They usually don’t go with a shopping plan and buy goods at whim. These consumers don’t care about brands.
The more common type is the consumer who buys things when required. For instance, a need-based consumer would buy a new laptop only if he doesn’t own one already or his existing laptop has died or is not functioning optimally. Consumers may also buy goods at a retail store or buy them in bulk for an organization.
Customers Shouldn’t Be Ignored
A seller’s marketing efforts are usually geared toward the consumer. But that doesn’t mean the customer can be ignored. For instance, advertising and marketing for toys are typically done to entice kids. If a kid gets excited about a toy, he would convince his parent (customer) to buy him the toy. However, since the customer is the one shelling out the cash, it’s important to get them on-board too. In other words, the parent should be convinced that the toy is safe to be used by kids.