What are five factors that influence demand?

The are a lot variables that drive demand for a product. I am not a marketeer so I do not claim to have the definitive answer. But I think that every entrepreneur should have some idea what drives demand for his products. Here are some of my thoughts on the issue.

The customer need the product satisfies. If potential customers do not have a need for a product there will be no demand for it. An example would be the demand for light bulbs in a place where there is no electricity.

The price of the product. The higher the price of a product the lower the demand for that product. Companies constantly play with the price to influence demand for their product. A good example is the price of airline tickets.

Number of potential customers for a product. The more potential customers there are, the higher the demand for the product. An example would be if you tried to sell water in the Sahara, a very dry place where people really need water to survive. I don't think you will do a booming business because the Sahara is a pretty empty place and so there are no potential customers.

The nature of the product also drives demand. If your product satifies an essential need for people to survive there is likely to be demand for it. On the other hand if your product is a pure luxury item demand is unlikely to be strong unless people have lots of money they can spend.

Competition influences the demand for your product. Competition specifically affects whether you sell the product or your competitor. It does not have an impact on total demand for a product. If you have less competition you will sell more of the product and vice versa.

I hope this helps a bit and have fun with it.

First answer by ID2560844939. Last edit by RobijnHornstra. Contributor trust: 43 [recommend contributor]. Question popularity: 78 [recommend question]