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Demand – Its Definition and Factors

The entire trading process is to meet the buyer’s and manufacturer’s needs. The first wants to receive a product or service that will improve the quality of their life and is ready to give with some money for this. The second wants to profit from selling the finished product, their knowledge, and skills.

Every product type needs a consumer. Otherwise, its production makes no sense. For example, e commerce software development services are required for owners of online stores, the same as every inhabitant of the planet needs to eat food. Therefore, we can use the term demand to characterize the interaction between the buyer and the product, and we need to carry out marketing research before creating a new product. Demand and factors that influence it

Demand is the price dependence on the quantity of a product or service that consumers can buy over a certain period. The basis of the concept is the value, the utility of the manufacturer’s offer for the buyer, adjusted for income level. You need to create some shortage of the finished product to increase it.

There are some factors influencing the amount of demand:

  • the price of the product;
  • type of product – for mass buyers, elites;
  • usefulness, value of the product for the consumer;
  • income, purchasing power;
  • prices for analogs from other manufacturers;
  • uniqueness of the product, its shortage;
  • fashion, and the current economic situation in the country.

Changes in demand affect the price of a product. Its increase does not lead to a decrease in the consumer’s desire to receive the product or service at the peak of popularity. When the highest point (maximum price) is reached, it either remains stable or begins to decrease.

A characteristic of demand is its elasticity. It is a change in the number of purchases when the price of a product increases or decreases. This indicator is influenced by the consumer’s income level and the product’s value.

For example, bread, meat, and milk are essential products that are highly elastic — the manufacturer maneuvers between price, income level, and the availability of analogs.

Jewelry is not an essential commodity; as the price increases, its demand will decrease. It is impossible to create a deficit.

Price formation – as a factor in the emergence and activation of demand

The basis of any pricing is knowledge of the cost of the product. It includes the cost of materials, depreciation of means of production, employee wages and taxes, and trade margins.

The final price is influenced by the availability of analogs and the quality of the product. A decrease in cost causes an increase in demand, but not below a certain level. If it is significantly lower than analogs from other manufacturers, the consumer will begin to doubt its quality. The consumer’s desire to receive the product declines, the manufacturer’s income decreases, and a surplus of goods arises.

Demand and mobile applications

A mobile application is a unique, one-piece product. It is developed for a specific consumer. A customer is interested in such a product in the following cases:

  • a country with a steadily growing economy focused on innovation;
  • high purchasing power among the population when the consumer can afford mobile gadgets and has a sufficient level of education to use them;
  • the customer plans to scale the business;
  • the customer of the application offers a variety of popular products.


The task of the manufacturer and the marketing department is to regularly conduct market research, target audiences, improve the product quality without changing the price, monitor new trends, and the population’s income. Only in this case will their product be in demand on the market.