Difference Between a Buyer and a Consumer

When you formulate a business and marketing plan you must take the time to identify your ideal target market. The target market is the group of people most likely to patronize the business. As a business owner or operator, you should understand the difference between a buyer and a consumer so that you know how to properly market your products and services to the public.

A buyer is a customer—he is an individual or business that makes a purchase from a seller. Regardless of the scenario, the buyer is the party that gives or transfers money to the seller to secure a product. A teenager getting a video game from a store at the mall is a buyer as is a distribution company that purchases raw materials from a manufacturer on credit.

On the other hand, a consumer is a person who uses a product or service. The consumer is often called an “end user” because he is the last stop and does not usually transfer or sell the item to another party. A buyer can be a consumer, as in the example of a teenager buying and using a video game. At the same time, a consumer is not necessarily the buyer—for instance, if a mother purchases cereal for herself and her family, each family member is a consumer of the product.

The difference between a buyer and consumer comes into play when a company is evaluating its overall business plan. A company usually falls into one, or both, of two categories—B2B (business to business) or B2C (business to consumer). As the name "business to business" suggests, this is a scenario where two commercial entities enter into a purchasing agreement. The purchasing business is simply a buyer when it plans to resell the items purchased, but it is a consumer when it uses them (as in the case of buying office supplies). A business to consumer arrangement is between a commercial entity and the end user.

When marketing a product or service a company has to identify the needs of both the buyer and the consumer. For example, a publisher who sells textbooks must market to both the distributor who will sell the textbooks and the professors who will order them for class. The requirements of a buyer may be different from the consumer, if they are two separate people, but in many cases the buyer’s decision is strongly influenced by the consumer’s needs.