FINAL CONSUMER: CONCEPT, CHARACTERISTICS, EXAMPLES - ECONOMY - 2025

The final consumer is the person or entity that does not buy a product to sell it to another for profit, but is for its own use. It is the last link in a distribution channel.

The distribution channel is the term used to describe the various routes that a product or service will follow before reaching the final consumer. This can be both a person and a company, using or consuming a particular product or service. On the other hand, it can also be an advertising strategy.

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When it refers to a person or entity, it is who consumes the product. You don't buy it and then sell it or give it to someone else.

As a type of promotion strategy, it is when it focuses on the end consumer of a product or service. In this case, the definition of end consumer helps to carry out a marketing strategy that works by first studying and understanding the needs of the end user of a service or product.

Final consumer concept

The final consumer is the person or entity that consumes the product or service purchased, without necessarily being the person or entity that has bought them.

The one who buys the service or product is called a "purchasing agent." The final consumer does not necessarily have to be the purchasing agent, who is the one who makes the purchase of the product.

Customer and end consumer

A final consumer can be defined as an individual who uses a product or service, and may also be the one who buys it. Thus, the final consumer could be the customer who enters a store to buy sweets. However, the end consumer is not always also the customer.

For example, a parent walks into the candy store to buy some candy. He does not eat them, so he is not the final consumer. Your child is the one who will eat the sweets and will be the final consumer, although he did not buy the sweets and, therefore, was not the customer.

The reason why it is required to know the difference between a customer and the final consumer is to understand the behavior of the person who instigates and influences a purchase decision, as well as that of the final consumer. For example, the child will surely influence the father's decision about which sweets to buy.

However, this can be much more subtle. For example, a wife can influence her husband's choice of clothes, or a son can influence the family's choice of a vacation destination.

characteristics

Manufacturers can reach the end consumer directly or through multiple levels of channels between them.

Market research

In-depth knowledge of end consumers is important, because they are the ones that keep manufacturers and traders in business. In marketing terms, customers and end consumers form a decision-making unit.

These can have different purchasing goals. For example, a mother buying a new pair of shoes for her child may be interested in cost and durability, while her child (the end consumer) may be more concerned with the brand and a modern look.

Several factors influence the response of end consumers to products. Many of these factors are objective.

For example, the final consumer's response can be influenced by whether the product solves a problem, or whether it works satisfactorily. Other factors are subjective and are based on social and psychological influences.

Therefore, market research and user feedback are required to obtain an adequate view of the consumer.

Distribution chain

The distribution chain can be a long series of events with complicated details, or a very short and simple event.

For example, a manufacturer that goes directly to the final consumer is when a person goes to eat at a restaurant. When the person orders the food, the restaurant is the producer and the individual is the final consumer.

On the other hand, if a store orders food prepared by the restaurant to sell to its customers, then this store will be an intermediary between the producer and the final consumer.

The distribution chain can be much longer. For example, a farmer sells a large quantity of corn to wholesalers, who sell it to resellers, who sell it to retailers, who will eventually sell it to the final consumer.

The longer the distribution channel, the more likely the final price of the product will be higher, because intermediaries will gradually add their own profits to the price of the item.

Examples

Iron and steel products

- A steel company that buys iron ore to use for steelmaking.

- Engineers using steel tools.

- People who use engines made of steel parts, using steel tools.

In the above cases, both iron and steel tools and motors are products purchased by end consumers. Therefore, the steel company, the engineers and the users of the engines are all final consumers.

Baby food

Suppose a mother named Maria buys a can of baby food to give to her 9-month-old son. Maria did not buy the food to eat herself. Instead, her baby was the one who ate her.

In this case, Maria is not the final consumer. She is only the purchasing agent, while her baby will be the final consumer.

Video game console

Suppose Janet is a mother who goes shopping for Christmas gifts. Jacobo is her son, who is eleven years old. Jacobo told his mother that he would like to receive a video game console as a Christmas present.

Janet arrives at the store and can see that they sell the Nintendo Switch, Sony PlayStation and XBox consoles. Janet thinks the PlayStation is much better than the other two. However, Jacobo has told him many times that the one he wants is the Nintendo Switch.

If price is not a determining factor, and Janet is like most mothers, she will buy the one Jacobo wants.

However, she could decide differently if, for example, Jacobo's choice cost triple the price of the other two consoles. However, in this case, the prices are not that different.

In this situation, Janet is the purchasing agent and Jacobo would be the final consumer.

References

1. Wise Geek (2019). What is a Final Consumer? Taken from: wisegeek.com.
2. Upcounsel (2019). Final Consumer Definition: Everything You Need to Know. Taken from: upcounsel.com.
3. Mba Skool (2019). Final Consumer. Taken from: mbaskool.com.
4. Market Business News (2019). What is final consumer? Definition and examples. Taken from: marketbusinessnews.com.
5. Tim Friesner (2019). What is a customer? Marketing Teacher. Taken from: marketingteacher.com.