Differences Between Customers, Consumers & Consumerism

Differences Between Customers, Consumers & Consumerism
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  • 0:02 Customer & Consumer…
  • 0:59 Consumerism
  • 1:58 Consumer Advocacy Groups
  • 3:12 Consumer Regulation
  • 5:25 Lesson Summary
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Lesson Transcript
Instructor: Jennifer Lombardo
In this lesson, you will learn the difference between customers and consumers. In addition, the idea of consumerism will be discussed through the explanation of consumer advocacy groups and regulation.

Customer and Consumer Definitions

You are down to the last question on the most popular game show in the country. The million-dollar question is 'What is the difference between a customer and a consumer?' Would you walk away with the money and the correct answer?

In this lesson, you will learn the difference between customers, consumers and consumerism. A customer buys products from businesses, while a consumer uses the business products. You can actually be both a customer and a consumer in a business transaction. For instance, you are both an Study.com customer and consumer, since you bought access to the lesson service and you use it to acquire a higher education. Now that you have an excellent foundation of the two key concepts, let's delve into how consumers protect their rights and powers.

Consumerism

Many of you might be familiar with the derogatory definition of consumerism, which is the preoccupation of society with the acquisition of consumer goods. The term consumerism also means an organized way to protect consumers from company policies and products that violate consumer rights, and that's what we'll be talking about here. It is a societal issue of the non-market environment, where government is tapped to create and enforce laws that will safeguard consumers from unethical business practices.

How did the idea of consumerism develop? Consumers were once trustful of business, but companies have not always been ethical and treated consumers ethically. For example, the manufacturers of cigarettes have been accused of knowing that their products are addictive and can kill their consumers. Consumers soon grew disenchanted with business and felt that they needed protection.

Consumer Advocacy Groups

Consumer advocacy groups soon developed, and their purpose was to protect the interests of the buying public. One of the most well-known consumer advocates is Ralph Nader, who started the consumer advocacy group called Public Citizen. For example, his group fought for over six years and finally was able to get the Department of Transportation in 2014 to issue a new auto safety standard to improve the rear design of vehicles, so that the driver can easily see what is behind them. This law was pursued by Nader's group because of the many deaths that have occurred due to drivers backing over people or children they cannot see.

In addition, the Consumer Federation of America is a conglomerate of over 300 non-profit consumer advocacy groups that watch out for all consumers. Lastly, the Better Business Bureau, or BBB, provides consumers with the ratings of businesses based on consumer complaints. A rating of A+ would reflect a reputable company. In addition to these groups, the federal government is also involved in the protection of consumer rights.

Consumer Regulation

Consumer protection is a major task of local, state and federal government. There are far too numerous local and state laws to mention that protect consumers against unethical business practices. You can find a list per state here: http://www.usa.gov/directory/stateconsumer/.

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