8 Demand States

All companies which sell their products or services are dependent on the demand from their consumer for their products or services and if that demand cannot be assessed properly by the company then it can lead to disaster for a company and that is the reason why it is important for the company to know various demand states of the consumer, let’s look at some of the states of demand –

8 Demand States

  1. Full Demand – This is the ideal state for any company because in this state demand from consumers is equal to the supply which the company can provide to its consumers and the only challenge for the company in this state is to keep giving same quality and service to consumers which it has been giving so that consumers do not switch to other products. It can also be called as the happy state because consumers are happy from company and company is also happy from its performance.
  2. Declining Demand – As the name suggests under this state the demand for the products of the company are on declining trend and if the company does not do anything to revive the demand then it can lead to complete loss of demand for the product. In the case of declining demand state company has to add some features to existing product to make it attractive or offer some price discounts so that demand does not decline.
  3. Irregular Demand – In this state the products of the company are such that they cannot be sold every day rather their demand is irregular, some example of irregular demand are umbrella which can be sold during rainy season only or water heaters which can be sold during winter season only and so on. The main challenge as far as the company is concerned in this state is to sell as much as possible during peak season so that overall sales for the year is sufficient to continue the production of products.
  4. No Demand – As the name suggests under this state there is no demand for product or services whatsoever, this state may happen due to the product being obsolete or general disinterest in the minds of the consumer. So for example demand for VCD player is not there because they have become obsolete due to the advent of DVD and Blu-ray.
  5. Unwholesome Demand – The dictionary meaning of unwholesome is harmful and in the case of economics unwholesome demand means demand for harmful products. This type of demand is present due to habits or addiction of the consumer towards certain products. So for example when a person is addicted towards alcohol he or she will demand it no matter what the price is, cigarettes, tobacco, drugs are some of the examples of unwholesome demand.
  6. Overfull Demand – Under this state, the demand for the products of the company exceeds the supply of the product, this type of state is a dream for any company because demand exceeding supply means pricing power in the hands of the company. However, this type of state does not remain for long because of various factors like competitors, company increasing the capacity of production and so on. The best example for overfull demand is online websites selling mobiles exclusively on their platform and the sale is opened for few hours and all mobiles are sold and many pending orders are rejected resulting in people getting desperate even more before the next sale.
  7. Latent Demand – This state of demand is there due to lack of information on the part of the consumer about the various features of a product and once he or she realizes those features he or she demands the product. So, for example, many people when the need for computer arises normally buy desktop computers but after some time when they get to know about the laptops which can be used at home as well as can be taken anywhere they think about buying a laptop instead of a desktop.
  8. Negative Demand – This state of demand is mainly present in healthcare industry because of people perception about their good health so many people tend to avoid going for sugar or blood pressure test until there is some big problem with their body or for that matter many people do not visit the dentist as long as their teeth do not have some major problem.

As one can see from the above that all products or service do not have the same demand due to various factors the main factor being consumer taste and mindset and that is the reason why there are so many states of demand which every company should keep in mind before deciding their marketing strategy for the products or service sold by the company.

1 comment… add one
  • poromon B. Charles

    It’s meaningful

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