The personal determinants of consumer behavior include age, occupation, lifestyle, income level and personality. These five qualities influence the types of products a consumer selects.
Consumers often choose products based on their age. A person's taste in music, movies and fashion may depend on their age. In addition, older people make purchases that young people don't, including cars, houses and insurance policies. Age can also influence lifestyle.
The most prominent example of the lifestyle factor in consumer behavior is customers who buy brand name clothing. Some consumers care about owning designer brands, while others don't. Whether a consumer chooses products that enforce or create a specific image is dependent on his lifestyle.
Consumer also shop in accordance with their occupation, which often dictates what a consumer needs and how they should dress. This goes hand in hand with income level. Consumers may consider price for a number of reasons, but the first is usually their own monthly earnings. Lower-income consumers are interested in products that ensure their survival, while wealthier customers can afford more luxury items.
Lastly, consumers shop based on personality. Every individual has his own preferences and interests that are not necessarily dependent on other factors. Businesses market certain fitness products to fitness buffs and entertainment products to film and television aficionados. This factor often supersedes the others and appeals to consumers on an emotional and personal level.Learn More
Moral hazard is the danger of bad behavior that arises when people are insured against the consequences of that behavior, while adverse selection is the tendency that only the people who need such insurance most are willing to pay for it. Both of these issues increase the cost of administering the systems where they arise. Adverse selection creates a more costly participant pool. Moral hazard creates costlier behavior in those participants.Full Answer >
The determinants of demand are the price of the good or service, income of the buyer, prices of related goods or services, tastes, preferences and future price expectations. The number of buyers may be considered another determinant relating to aggregate demand.Full Answer >
The determinants of personality are the factors that influence the development of personality, such as nature, or biological, and nurture, or environmental. Views differ on the key determinants of personality, and more contemporary theories point toward the possibility of situational and physical factors in addition to the traditional nature/nurture dialectic.Full Answer >
The three most frequently studied demographic variables in the U.S. consumer market are age, gender and income level. Other variables that are frequently considered include education level, consumer occupation, family life cycle, social class, race and ethnicity. Demographic variables are associated with consumer needs and buying patterns.Full Answer >