You're correct; lossless formats aren't needed by the average consumer. But the problem they solve is a very real thing. Think of the difference between a repeatedly edited JPG vs. a repeatedly edited PNG. Every save of the JPG destroys information irretrievably, whereas every save of the PNG keeps it all. It's the same with MP3 vs. FLAC: MP3 throws away information each export, but FLAC doesn't.
For an example, music artists/producers can't afford to lose information when they "bounce" a track. FLAC solves that. "People" don't need lossless, but for those that do, it's great.
For an example, music artists/producers can't afford to lose information when they "bounce" a track. FLAC solves that. "People" don't need lossless, but for those that do, it's great.