Chapter 2

Individual Factors that affects Consumer Behaviour

The personal factors of a consumer may affect the buying decisions. The primary individual
factors that describe an individual and help us understand consumer behaviour are demographic
characteristics of age & life cycle stages, sex, education, occupation and income. Under this part
we will discuss them in relation to their marketing implication.
Learning objectives:
At the end of this part you will be able to:
 List and describe the personal factors that affect the buying behaviour of consumer
 Segment customers based on personal factors of consumers
 Use it for marketing strategy design and positioning
2.1. Age and life cycle stages
A. Age group (life cycle)
Age is one of the primary demographic factors that influences the behaviour of a person and used
to describe the needs and behaviours of people in that age group. Especially on the consumption
side of a person, the age factor greatly influences the buying behaviour. For instance, teenagers
may prefer trendy clothes, whereas, office- executives may prefer sober and formal clothing. The
young people may want to follow fashion and new styles; while the older people can be
conservative and prefer to stick to their oldies.
Furthermore; as we grow older, our needs and preferences change, often in common with others
who are close to our own age. For this reason, a consumer’s age exerts a significant influence on
his or her identity. All things being equal, we are more likely than not to have things in common
with others of our own age.
Different age groups have distinct needs, preferences, and financial capacities that influence how
they make purchasing decisions.
When we see children and adolescents they usually rely on parents or guardians for purchasing
power, but they can still exert influence over family purchasing decisions, particularly in areas
like toys, clothes, and entertainment. There is Brand Affinity hence early exposure to
advertisements shapes preferences. They are often attracted to trendy, visually appealing, or
character-based products (e.g., toys, fashion, video games).Teenagers, in particular, are highly

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influenced by peer opinions, social media, and popular culture, which significantly impacts their
consumption behavior.
Young adults or the youth on the other hand, are typically more tech-savvy, making them more
likely to embrace new technologies, gadgets, and online shopping. They are highly influenced by
social media, digital marketing, and trends. They might be less brand-loyal and more inclined to
try new brands and products, especially those endorsed by influencers. They are highly
influenced by social media, digital marketing, and trends. They might be less brand-loyal and
more inclined to try new brands and products, especially those endorsed by influencers. They
tend to spend on experiences (e.g. dining out, entertainment) and things that reflect their identity,
such as fashion and technology. Many in this group may be students or early in their careers, so
their purchasing behavior can be constrained by limited disposable income.
When we see the consumption behavior of middle-aged adults, these people settle into their
careers and families, they tend to seek products that offer long-term value, reliability, and
practicality. This age group may prioritize home improvement, family-oriented purchases, and
healthcare products. They are often more loyal to established brands that they trust. With higher
disposable incomes, they may make larger or more frequent purchases, especially in areas like
home goods, cars, and vacations. There is a growing awareness of health and wellness, leading to
increased spending on fitness-related products, organic foods, and preventative healthcare
services.

Older consumers often focus on products and services that support their health, comfort, and
retirement lifestyle. This includes spending on healthcare, wellness products, travel, and home
modifications. While less likely to adopt cutting-edge technology, older adults are increasingly
using smartphones, computers, and online shopping for convenience. Many in this group are
retired or nearing retirement, so they may be more price-sensitive and careful about long-term
financial stability, affecting their buying decisions.Older consumers often prioritize quality over
quantity, willing to pay more for products that are durable, easy to use, and provide comfort.
B. Age cohorts: ‘my generation’.
An age cohort consists of people of similar ages who have undergone similar experiences.
Although there is no universally accepted way to divide people into age cohorts, each of us
seems to have our own idea of what we mean when we refer to ‘my generation’. Often the needs,

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wants, styles, and preference of an age cohort is similar. Therefore, one of the demographic
factors for segmenting consumers is their age cohort.
Marketers often target products and services to one or more specific age cohorts. They recognize
that the same offering will probably not appeal to people of different ages, nor will the language
and images they use to reach them. In some cases separate campaigns are developed to attract
consumers of different ages.
Important age cohorts include: boomer generation, generation X, generation Y, generation Z and
generation Alpha.
Baby boomers were born at a time when WWII had just ended, and there was a feeling of hope
economic prosperity, significant technological advancements, and societal changes. They are
often in their peak earning years or enjoying retirement benefits. They are likely to spend on
travel, healthcare, and leisure activities. This cohort tends to show strong brand loyalty, often
preferring established brands that they’ve trusted over the years. Baby boomers value products
that are reliable, durable, and offer long-term value. They may prefer in-store shopping over
online, particularly for items like clothing, electronics, and home goods. As they age, boomers
are more inclined to spend on health-related products and services (e.g., fitness equipment,
supplements, and healthcare services). They are also less tech-savvy:

Gen X is defined by its love for music and art. X is also known as the last generation to hold dear
to its culture and education, and is the last to understand a different cultural world before
technology became the norm. Having experienced economic instability, Gen X tends to be
pragmatic and price-sensitive, often looking for value and bargains when shopping. They were
early adopters of technology but may not be as immersed in the latest trends as millennials.
Many are tech-savvy and use e-commerce but also appreciate brick-and-mortar shopping. Many
Gen Xers have children and spend on family-oriented products such as housing, education, and
children’s entertainment, as well as lifestyle products (e.g., cars, electronics, and home
appliances). With a focus on long-term financial security, this cohort is also more likely to invest
in products that offer value over time such as insurance.
Generation Y, also called Millennials were born at a time when technology was
taking true shape, majorly for productivity. Millennials are highly influenced by digital
platforms, online reviews, and social media, making them more likely to engage with brands

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through apps, websites, and influencers. They value experiences over material goods, leading to
greater spending on travel, dining, and entertainment rather than just physical products.
Millennials often gravitate toward brands that align with their values, such as sustainability,
diversity, and social causes. They are more likely to subscribe to digital services (e.g., Netflix,
Spotify) and products (e.g., meal kits, beauty boxes) for convenience. Many millennials face
significant student loan debt, which impacts their purchasing decisions, often making them more
cautious about large purchases like house or cars.
Gen Z is accustomed to seamless digital experiences. They are heavy consumers of content on
social media platforms like TikTok, Instagram, and YouTube and often make purchases directly
through these platforms. Gen Z is heavily influenced by social media influencers, trends, and
viral content. They tend to value peer opinions over traditional advertising and are attracted to
brands that seem authentic and transparent. This generation places a high value on sustainability,
diversity, and social justice. They are likely to support companies with eco-friendly practices or
those that champion social causes. Gen Z seeks personalized experiences and products, with a
focus on self-expression and individuality, such as customizable fashion, gadgets, or even beauty
products. Despite being young, Gen Z tends to be financially cautious, often seeking value and
practical benefits. They are interested in side gigs and entrepreneurial ventures and might value
saving over spending.
Alphas will probably be the most transformative generation . Alphas are born in a world
saturated with gadgets and are experiencing the implementation of new technology innovations
as years go by. As the children of digital natives, they are likely to be even more immersed in
technology, using devices and digital services from a very young age. Though they are still
children, their preferences and behaviors are heavily influenced by their parents' choices and the
brands their parents engage with. However, they are expected to shape the future of
consumption, especially in terms of how brands cater to children’s needs for entertainment,
learning, and self-expression.
Often the needs, wants, styles, and preference of an age cohort is similar. Hence marketers often
target products and services to one or more specific age cohorts. They recognize that the same
offering will probably not appeal to people of different age cohort. Not only the offering but also
the language and images they use to reach them should differ. In some cases separate campaigns
are developed to attract consumers of different age cohorts.

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C. Perceived age: you’re only as old as you feel.
The marketers should not focus on chronological age cohorts of consumers as the sole age factor.
Besides the chronological age and age cohort of a person there is a perceived age (an age that a
person feels he is). That is why they say you are only as old as you feel. That is some adults want
to remain younger, they delay their marriage, wear, act, and behave like younger people. The
same holds true for some elderly people, they want to delay their aging by adapting healthy life
style and remaining active. Therefore, the ‘grey’ market does not consist of a uniform segment of
vigorous, happy, ready-to- spend consumers – nor is it a group of senile, economically
marginalized, immobile people. In fact, research confirms the popular wisdom that age is more a
state of mind than of body. A person’s mental outlook and activity level has a lot more to do with
his or her longevity and quality of life than does chronological age, or the actual number of years
lived. In addition to these psychological dimensions of age, there are also cultural influences on
what constitutes ageing, and perceptions of what are ‘elderly’ across different European markets
(Pol, 1991).
This perception can significantly influence their consumption behavior, as individuals often
make purchasing decisions based on, how they identify with their own age, how others perceive
their age, or how they want to be perceived by others.
How They Identify with Their Own Age: A person's internal sense of age, or how old they
feel, can drive their purchasing behavior. For instance, someone who feels younger than their
actual age may be drawn to products typically marketed toward younger generations. This could
include trendy clothing, gadgets, or beauty products that promise to maintain a youthful
appearance. People who perceive themselves as younger or older may adjust their consumption
to align with their internal identity. If someone identifies with a youthful mindset, they may seek
products that reinforce this image. On the other hand, those who see themselves as older may
prioritize items that symbolize maturity or wisdom, such as books, home decor, or luxury goods
that suggest established status.
How Others Perceive Their Age: People’s consumption is often influenced by how they think
others perceive them. Social norms and cultural expectations can dictate what’s considered
appropriate or desirable for someone of a certain age. For instance, a person may buy a product
simply because they believe it will align with how they are expected to be seen by others, even if
they don’t feel that way internally.

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How They Want to Be Perceived by Others: People often make purchases based on how they
want others to see them, particularly regarding youthfulness or status.
Perceived age can be measured on several dimensions, including ‘feel-age’ (how old a person
feels) and ‘look-age’ (how old a person looks) (Schiffman, 2012). The older consumers get, the
younger they feel relative to actual age. For this reason, many marketers emphasize product
benefits rather than age appropriateness in marketing campaigns, since many consumers will not
relate to products targeted to their chronological age.
Marketing application of age as a factor
Marketers need to study age as a demographic factor. They should assess the consumption
patterns, preferences, wants, and needs of different age cohorts. They should assess their changes
in consumption behaviour as they move from one age group to another. They should segment
their consumers based on age as one of the factors and target different age groups in a way that
meets their expectation. Marketers should adapt their marketing mix to each target market’s
characteristics.
2.2. Gender
Besides their age cohorts, consumers’ consumption also needs to be understood from their sexes.
The consumer behaviour varies across gender. Sexual identity is a very important component of
a consumer’s self-concept.

Sex is biological but gender roles and preferences are partly shaped by culture. As Ethiopian our
gender stereotype is also shaped by Ethiopian culture. People often conform to their culture’s
expectations about how those of their gender should act, dress, speak and so on. It is not always
clear to what extent sex differences are innate rather than culturally shaped – but they’re
certainly evident in many consumption decisions! (Swarna, 2012).
A society’s assumptions about the proper roles of men and women are communicated in terms of
the ideal behaviours that are stressed for each sex (in advertising, among other places). It is
likely, for instance, that many women eat smaller quantities because they have been ‘trained’ to
be more delicate and dainty.
A person’s sex-role identity is a major component of self-definition. Conceptions about
masculinity and femininity, largely shaped by society, guide the acquisition of ‘sex-typed’
products and services.

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We can explore how gender influences consumption behavior across several key dimensions.
1. Product Preferences
Traditional Gender Roles: Historically, men and women have been socialized to favor different
types of products based on gendered expectations. Women have often been associated with
products related to beauty, fashion, and home care, while men have been linked to products
related to technology, tools, and outdoor activities.
Women’s Consumption: Women tend to spend more on personal care products (like skincare,
cosmetics, and fashion), health and wellness items, and household goods. Women's products are
often marketed with an emphasis on beauty, nurturing, and maintaining the home.
Men’s Consumption: Men often focus on products related to personal grooming, technology
(e.g., gadgets, electronics), sports and outdoor gear, and automobiles. Men’s consumption
behavior may also lean towards products associated with strength, performance, and practicality.
Changing Trends: In recent years, there’s been a shift toward more unisex or gender-neutral
products, particularly in categories like clothing, cosmetics, and fragrances. Brands are
increasingly marketing products that appeal to broader, more inclusive audiences, reflecting
changing attitudes toward gender roles.
Example: Beauty brands are now offering "genderless" beauty products, with a focus on skin
care rather than emphasizing “feminine” or “masculine” labels.
2. Advertising and Marketing
Gender-Specific Marketing: Marketers often tailor advertisements to appeal to traditional gender
norms. For example, beauty ads often feature women, while car commercials frequently feature
men. These gendered advertisements reinforce societal expectations about which products are
"appropriate" for each gender.
Women’s Advertising: Ads targeted at women often focus on appearance, emotional appeal, and
domestic roles. Women’s products are frequently marketed with an emphasis on beauty,
nurturing qualities, or personal improvement.
Men’s Advertising: Advertisements targeting men tend to emphasize strength, power,
functionality, and practicality. These ads may showcase masculine traits, such as ruggedness or
performance, aligning with the stereotypical image of masculinity.
Influencers and Social Media: In the digital age, gender influences the type of content shared by
influencers. Female influencers often focus on beauty, fashion, and lifestyle, while male

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influencers might focus on fitness, technology, or cars. However, there’s growing diversity in
influencer roles across gender lines.
Example: Male influencers promoting skincare products challenge traditional gender norms
around beauty and self-care.
3. Buying Behavior and Decision-Making
Women’s Buying Behavior: Studies show that women are often more involved in the purchasing
decision process for household items, food, and health-related products. Women are also seen as
more value-driven, placing a greater emphasis on emotional aspects of consumption, such as the
experience of the product, its emotional appeal, or the ethical implications of its production.
Example: Women might be more likely to research a brand’s sustainability practices before
purchasing clothing, focusing on ethical sourcing and eco-friendly materials.
Men’s Buying Behavior: Men are often more focused on product functionality, performance,
and practicality. When making purchasing decisions, men tend to value clear, direct information
about a product's quality, benefits, and durability.
Example: A man buying a new gadget may prioritize features like battery life, performance, and
ease of use, while a woman might also be drawn to the design or aesthetics of the product.
Group vs. Individual Decision-Making: Women are typically perceived as more social
shoppers, often consulting others (family, friends, or online reviews) before making a purchase.
Men, in contrast, may make more individual decisions, especially in categories like electronics or
automobiles.
Example: Women may spend more time browsing and discussing products online (on forums or
with peers) before purchasing, while men may rely more on technical specifications when buying
products like laptops or smartphones.
4. Social Influence and Peer Pressure
Peer Influence and Gender: Women are generally more influenced by peer opinions, social
groups, and emotional connections in their purchasing decisions. Social influence may lead
women to buy clothing, accessories, or beauty products to conform to social expectations or
trends.
Example: Women might purchase items because they’ve seen friends or influencers wear them,
creating a sense of belonging or fitting in with a particular group.

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Masculinity and Status: For men, products that enhance social status, performance, or strength
(such as high-end cars, designer watches, or tech gadgets) can play a key role in how they are
perceived by others. Men may be more likely to purchase items that symbolize power, success,
or masculinity.
Example: A man may purchase a luxury sports car to signal wealth and success, reflecting an
image of high status in his social circle.
5. Emotional vs. Practical Consumption
Women’s Emotional Consumption: Women are often more likely to make emotional purchases,
driven by feelings or a sense of self-expression. Emotional consumption may involve buying
fashion, beauty, or home décor items to reflect their identity, enhance their mood, or fulfill
emotional needs.
Example: Women might purchase clothing or beauty products to boost their self-esteem, address
body image concerns, or simply indulge in personal care for relaxation.
Men’s Practical Consumption: Men tend to make more practical purchases based on necessity
or performance. While emotional factors are still relevant, especially in categories like
entertainment or leisure, men’s buying behavior often centers on products that offer
functionality, utility, or efficiency.
Example: A man may prioritize purchasing a toolset or a new laptop to fulfill a specific need or
improve his daily tasks, rather than buying for emotional satisfaction.
6. Influence of Gender Norms and Stereotypes
Challenging Gender Norms: As society becomes more aware of the fluidity of gender, many
individuals are moving away from traditional gender norms, and this shift is reflected in
consumption behavior. Many consumers, particularly younger generations, are embracing
gender-neutral or non-binary products.
Example: Gender-neutral clothing, cosmetics, and fragrances are gaining popularity as brands
cater to individuals who do not want their identities to be constrained by traditional gender
roles.
Gender Fluidity and the Market: The rise of gender-fluid consumption has led companies to
reevaluate how they market products, with more focus on inclusivity. Some brands now create
unisex or gender-neutral products that appeal to a broad audience, acknowledging that gender
identity doesn’t strictly correlate with certain consumption behaviors.

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Marketing application of gender factor
As marketers you need to understand the gender role in the society. Gender plays a significant
role in shaping consumption behavior through traditional roles, emotional drives, and social
expectations. Sex-based consumption patterns are influenced by biological differences, cultural
norms, and evolving societal attitudes. While these factors influence how individuals make
purchasing decisions, it’s important to recognize that as gender norms evolve, consumption
behavior is becoming more diverse and less rigidly defined. Moreover, the lines between male
and female consumption patterns are becoming blurred as individuals increasingly make choices
based on personal preference, rather than strictly adhering to traditional sex-based expectations.
Hence, brands must adapt to this shift by being more inclusive and recognizing that consumers
increasingly reject stereotypical gender-based categories in favor of products that align with
personal identity, values, and preferences.

2.3 Education
Education and consumer behavior are closely interconnected. Education influences consumer
behavior by shaping individuals' values, preferences, and decision-making processes. The level
of education an individual attains can shape their purchasing decisions, product preferences, and
even their values regarding consumption. Here’s an in-depth look at how education influences
consumer behavior:

1. Informed Decision-Making
Knowledge Acquisition: Consumers with higher education tend to seek out more information
about products and services before making purchasing decisions. They are more likely to
conduct thorough research, read reviews, and compare alternatives.
Critical Thinking: Education fosters critical thinking skills, enabling consumers to evaluate
advertising claims, assess the credibility of sources, and make more rational decisions instead of
being swayed by emotional appeals or superficial marketing tactics.
Increased Awareness: Educated consumers are generally more aware of their rights and can
better understand product labels, terms of service, and warranty information, leading to more
informed choices.

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2. Brand Loyalty and Preferences
Brand Consciousness: Consumers with higher education levels may be more discerning about
the brands they choose. They might prioritize brands that align with their values, such as ethical
production, sustainability, or corporate social responsibility.
Brand Loyalty: Education can also influence how likely consumers are to develop loyalty to
specific brands. They may become more attached to brands that offer consistent quality,
transparency, and value for money.
Innovative Preferences: Educated individuals may also be more open to adopting innovative
products or services, driven by their desire for efficiency, new technology, or advanced features.

3. Financial Literacy and Spending Habits

Better Financial Management: Education can significantly improve a consumer’s financial
literacy, helping them make more informed decisions about budgeting, saving, and investing.
This can lead to better long-term financial planning and less impulsive spending.
Understanding Costs: Consumers with higher education are more likely to understand the long-
term financial implications of their purchases. For example, they might choose higher-quality
products with a longer lifespan over cheaper, lower-quality alternatives.
Value-Oriented Purchasing: Highly educated consumers may prioritize value over cost,
meaning they are more likely to spend more on products that promise longevity, better quality, or
ethical production, even if the upfront cost is higher.

4. Ethical and Sustainable Consumption

Environmental Awareness: Education increases awareness of global issues like climate change,
resource depletion, and environmental sustainability. As a result, educated consumers may be
more likely to buy products that are eco-friendly, sustainably sourced, or produced using ethical
labor practices.
Ethical Concerns: Beyond environmental factors, education also leads to increased awareness of
issues like fair trade, corporate social responsibility, and social justice. Educated consumers
might choose to support brands that reflect their ethical stance, even if it means paying a
premium for such products.
Health-Conscious Choices: Education is often correlated with greater health consciousness.
Educated consumers may prioritize healthy food choices, such as organic, non-GMO, or plant-
based products, due to a better understanding of nutrition and health risks.

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5. Technology and Digital Consumer Behavior
Adoption of Technology: Educated consumers are more likely to embrace new technologies,
such as online shopping, digital payments, and mobile apps, due to their familiarity with
technological tools. This can lead to a greater preference for e-commerce platforms, digital
services, and tech-savvy brands.
Use of Digital Resources: Consumers with higher levels of education tend to be more adept at
using digital resources to research and purchase products. They are more likely to rely on search
engines, social media, online reviews, and comparison websites to inform their buying decisions.
Privacy Awareness: Educated consumers may also be more cautious about digital privacy,
understanding the risks of data breaches and online fraud. This can influence their purchasing
behavior, with a preference for brands that emphasize data security and transparency.

6. Impact on Advertising and Marketing

Advertising Skepticism: Educated consumers are often more skeptical of traditional advertising,
especially when it seems exaggerated or manipulative. They may be more inclined to trust word-
of-mouth recommendations, online reviews, or third-party endorsements rather than relying on
direct marketing.
Targeted Messaging: Marketers often tailor their messages to different educational levels. For
example, ads targeting educated consumers might emphasize product quality, innovation, and
detailed information, while ads targeting less-educated consumers may focus more on emotional
appeal or simplicity.

7. Social Influence and Peer Pressure

Social Responsibility: Educated individuals may be more influenced by social responsibility
when making consumption choices. They may engage in socially-conscious consumption,
considering the societal impacts of their purchasing decisions and how those choices reflect their
identity and values.
Peer Influence: Education also plays a role in shaping social circles. Consumers with higher
education may interact with peers who value similar ethical, environmental, or health-related
principles, further reinforcing certain consumption behaviors (e.g., choosing organic products,
supporting ethical brands).

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8. Risk Perception and Decision-Making
Risk Aversion: Educated consumers may perceive less risk in complex or unfamiliar products
because they are more adept at gathering information and understanding the product’s value.
This can make them more open to trying new products, especially if they feel well-informed
about the potential benefits or drawbacks.
Long-Term Thinking: Education can also encourage consumers to make decisions with long-
term benefits in mind. For instance, they may be more willing to invest in products that provide
long-term value, such as a high-quality appliance, rather than opting for short-term satisfaction.

Marketing application of education factor

Education profoundly shapes consumer behavior by influencing how individuals make decisions,
interpret information, and prioritize values such as quality, sustainability, and social
responsibility. Hence understanding how education impacts consumer behavior is crucial for
crafting effective marketing strategies, offering the right products, and fostering brand loyalty.

2.4. Occupation
Occupation and educational achievements are the other demographic factor that influences
consumers’ behaviour. Education: is a very important shaping factor of a person’s development,
his cognition, occupation, and income generating capacity. It can also be source of prestige and
respect in a society.

Highly educated persons may spend on books, personal care products, and so on. But a person
with low or no education may spend less on personal grooming products, general reading books,
and so on.

The influence of occupation on consumption behavior is a key area of study in economics,

sociology, and marketing. A person's occupation can significantly shape their consumption
patterns, including the types of goods and services they purchase, their spending habits, and even
their values related to consumption. Here are several ways occupation can impact consumption
behavior:
1. Income Level and Economic Status:
Occupation is often closely tied to a person's income, and income levels play a significant role in
shaping consumption behavior. High-income occupations, such as those in executive roles,
medicine, or law, tend to have a higher disposable income, allowing for more discretionary
spending on luxury goods, travel, and high-end services. On the other hand, lower-income

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occupations, like service or retail workers, may have more limited spending power and focus
more on essential goods and budget-friendly options.
Example: A corporate executive may spend on premium brands, luxury cars, or frequent travel,
while someone in a manual labor job might focus on practical, affordable products.
2. Time Availability:
Occupations that require long working hours or irregular schedules, such as doctors, lawyers, or
high-ranking business executives, may influence consumption in terms of convenience and
efficiency. People in these occupations might prioritize ready-made or quick-to-prepare meals,
online shopping, or high-tech solutions that save time.
Conversely, those with more flexible work hours or occupations that don't demand as much of
their time may have more opportunities to engage in leisurely shopping or cooking, leading to
different consumption behaviors.
3. Job-Related Needs and Consumption:
A person's job might require them to purchase specific goods or services. For example,
individuals in creative fields (designers, writers, musicians) may invest in tools or technology
that support their work, such as high-quality computers, software, or equipment. Similarly,
professionals in the healthcare field might invest in specific types of clothing, like scrubs or
protective gear.
Occupation can also influence the purchase of work-related services, like professional
development courses, conferences, or subscriptions to industry-specific publications.

4. Social Status and Identity:

Occupation can shape an individual's social status and influence how they want to be perceived
by others. This can manifest in consumption choices, such as the purchase of designer clothes,
luxury cars, or homes in affluent neighborhoods. People might use consumption to signal success
and align with the social group associated with their occupation.
Example: A lawyer or banker might invest in formal attire, watches, or fine dining experiences
to project an image of professionalism and success.
5. Values and Attitudes:
People in certain occupations may develop distinct values or attitudes that influence their
consumption. For example, someone working in an environmental sustainability-focused job

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may be more likely to purchase eco-friendly products or support green companies. Similarly,
those in healthcare might have a greater focus on health-conscious or organic products.
Occupations that emphasize corporate social responsibility or community welfare, like social
workers or teachers, may encourage more conscious, value-driven consumption behaviors.
6. Geographic Location:
The type of occupation someone holds may influence their geographic location, which in turn
can shape their consumption patterns. Urban workers in industries like finance, technology, or
fashion may have different consumption behaviors compared to individuals working in rural
settings, where products and services are different or more regionally focused.
Urban workers may have more access to diverse and specialized goods and services, such as
international cuisines, high-end shopping districts, and niche entertainment options, while rural
workers may have more limited options.
7. Cultural and Professional Networks:
Occupations often come with specific cultural and professional networks that influence
consumption. For example, those in academia or technology may engage in different types of
intellectual or leisure consumption (books, gadgets, software) than those in sales or marketing,
who might focus on clothing, networking events, or trends.
Additionally, peers and colleagues in an individual's professional network may also shape
consumption behavior, as people often follow trends or adopt similar products within their social
and professional circles.
8. Psychological Impact:
The nature of a job can influence the psychological state of the worker, which in turn affects
consumption. For instance, individuals in high-stress jobs may engage in consumption as a form
of stress relief or self-reward (e.g., indulgent foods, spa treatments, or luxury purchases).
Conversely, those in less stressful, more routine-based jobs may prioritize savings or more
practical purchases.

Marketing application of occupation factor

Occupation is a crucial determinant of consumption behavior, impacting the types of products
and services people purchase, how much they are willing to spend, and their overall approach to
consumption. Understanding the relationship between occupation and consumption behavior can

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help businesses better target their marketing efforts and it provides insight into broader societal
patterns of spending and resource allocation.

2.5. Income
The other personal factor which is most important determinant of consumption behaviour of a
person is his income level. Income plays a fundamental role in shaping consumption behavior, as
it directly affects a person's ability to purchase goods and services. The relationship between
income and consumption is complex and multifaceted, influenced by several factors.

1. Disposable Income and Purchasing Power:

Disposable income refers to the income left after paying taxes and necessary living expenses,
such as rent, utilities, food, and transportation. This is the portion of income people have to
spend on discretionary goods and services. The more disposable income a person has, the greater
their purchasing power and, thus, their ability to spend on non-essential or luxury items.
For example, a person with a high disposable income can afford to buy luxury goods, travel
frequently, dine at expensive restaurants, and invest in premium brands. In contrast, someone
with a lower disposable income may prioritize essential items like groceries, rent, and
transportation, limiting their ability to purchase non-essential or luxury items.

2. Basic Needs vs. Luxury Goods:

The income level of an individual greatly influences their consumption choices between basic
needs (such as food, housing, and healthcare) and luxury goods (such as designer clothing,
electronics, and vacations).
Lower-income individuals tend to focus their spending on necessities and affordable options,
whereas higher-income individuals have more flexibility to indulge in luxury or non-essential
items.
Example: A person with a modest income may buy generic or store-brand products, while a
higher-income individual may opt for premium or branded products.

3. Income Elasticity of Demand:

The concept of income elasticity of demand refers to how the demand for a good or service
changes in response to changes in income. Products with a high income elasticity (luxury goods,

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high-end electronics, or vacations) tend to see an increase in demand as income rises, while those
with low income elasticity (basic necessities, like bread or rice) are less sensitive to income
changes.
For example, when a person's income increases, they might decide to upgrade their car or take
more vacations, but their spending on basic groceries might remain relatively stable.

4. Consumption Patterns and Savings:

Higher-income individuals often have the ability to save a larger portion of their income.
Savings might be directed into investments, retirement funds, or wealth-building activities. This
ability to save can further affect consumption behavior by allowing these individuals to purchase
more expensive goods in the future.
In contrast, lower-income individuals may have limited ability to save and might prioritize
immediate consumption needs over long-term savings. This difference can lead to contrasting
consumption behaviors, such as more frequent smaller purchases for lower-income individuals
versus larger, infrequent purchases by higher-income individuals.

5. Social and Psychological Factors:

Income can also impact consumption behavior due to social status and psychological factors.
Individuals with higher income may feel social pressure to display their success through the
consumption of visible luxury goods, such as expensive cars, designer clothing, or upscale
experiences (fine dining, exclusive travel). This is often linked to a desire to maintain or elevate
their social status.
Example: A person in a high-income bracket might buy the latest tech gadgets or exclusive
fashion items to signal their wealth, while someone with lower income might not have the
financial means to engage in such behavior.

6. Cultural and Societal Influences:

Culture and society also play a role in shaping consumption patterns based on income. In some
cultures, there is significant pressure where individuals with higher incomes are expected to
consume goods and services that are seen as symbols of status and success. This can create a
cycle where income influences not just consumption but the social expectations around it.

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For example, in societies with high levels of income inequality, people with higher incomes may
engage in conspicuous consumption (buying expensive goods to display wealth) while those with
lower incomes may have more modest consumption patterns.

7. Long-Term vs. Short-Term Consumption:

Higher-income individuals might have the financial flexibility to make long-term investments
in durable goods (e.g., houses, cars, long-term insurance) and luxury experiences (e.g., overseas
travel). This ability to invest in future consumption patterns reflects a higher level of financial
security.
Lower-income individuals, by contrast, may focus more on short-term consumption, as they
are more likely to spend on immediate needs and may not have the security to invest in long-
term goods or services.
Example: A high-income individual may buy a vacation home for future relaxation and long-
term investment, while someone with a lower income may prioritize short-term pleasures such as
frequent dining out.

8. Impact of Economic Downturns:

During periods of economic recession or financial instability, income levels may decline for
many people, which can drastically alter consumption behavior. People with lower incomes may
become more frugal, seeking discounts, using coupons, or reducing non-essential spending.
Those with higher incomes may cut back on discretionary spending but are less likely to be
affected in the same way.
Example: During a recession, a high-income family may stop buying luxury items but still
maintain their spending on basic needs. A lower-income family, however, may cut back
significantly on even essential purchases like clothing or groceries.

9. Credit Availability:

For individuals with higher income, access to credit might be easier, allowing for more
extensive consumption on credit. They might take out loans for purchasing real estate or luxury
cars, or use credit cards for everyday spending without worrying about immediate cash flow.

Lower-income individuals may face more restricted access to credit, which can limit their
ability to make larger purchases or rely on credit to smooth out consumption over time.

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Marketing application of income level
Income has long been an important variable for distinguishing between market segments.
Marketers commonly segment markets on the basis of income because they feel that it is a strong
indicator of the ability (or inability) to pay for a product or a specific model of the product.
Therefore, marketers need to understand the wants and preferences of different income groups
before they determine their marketing mix for each target market.
Understanding these dynamics helps businesses and policymakers predict consumption patterns,
market products effectively and design interventions that consider economic disparities.

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