Demographic Environment
This article covers meaning, importance & factors of Demographic Environment from marketing perspective.
What is Demographic Environment?
Demographic environment is a concept which defines the features & attributes of a particular market where the company is looking to do business. Demographic environment has multiple factors like age, gender, income, education, geography, culture & population trends. Understanding demographics environment is important for businesses as it gives them an understanding about a popular and helps identifying the accurate target audience.
Importance of Demographic Environment
Demographic approach provides very specific information about different populations. Based on the data, the company can develop well defined strategies helpful to reach more population. For example if the demographic environment tends to be busy, young workers, then the company might intend to promote the quick use and convenience available with the product.
However, sometimes the focused approach may lead to loss of potential customers who do not fit the general demographic trend because the company does not concentrate on bringing in those customers. This also includes the loss of sales from those persons who might buy the product/ service for some other person who is not aware of the product/ service.
Factors of Demographics Environment
A few important features & characteristics of demographic environment are as follows.
Age
This is a critical factor which enables companies to identify the right audience based on their age group. Broadly, different age groups like infants, kids, teenagers, adults, old etc. can define different categories for different product types.
Gender & Ethnicity
Factors like gender or ethnicity of the market are useful to segment the target population for impactful marketing. The focus lies mostly on the people who are most likely to buy the product. This ensures that the company does not waste money in people who have no interest in buying the product.
Income & Education
Income & education can define the purchasing power capacity of a person a company is looking to target. A person with a higher income can look to purchase a more customized, higher quality, premium product as compared to someone who has a lower income.
Population Trends
Populations are never constant. They always migrate from place to place and die or are born. Hence, marketers cannot just collect demographic data at one time. They have to continuously collect the information about people in order to have an instantaneous picture of what is happening in the real world at any given point of time.
Thus, these demographic factors are always important for businesses to understand their customer.
Hence, this concludes the definition of Demographic Environment along with its overview.
Browse the definition and meaning of more similar terms. The Management Dictionary covers over 1800 business concepts from 5 categories.
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