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  • Shasha Kummar

    November 22, 2021 at 8:37 pm

    Discuss your opinion on government intervention and how understanding consumer behaviors shape your business strategies?

    Economy can generally divided into macroeconomics and microeconomics. Macro-economic is a theory which covers behaviour of a national economy as a general and/or whole. Government intervenes by policy management for stronger national economy growth and macroeconomic stability. i. e government policies to develop the economy of the nation, the collection of taxes and government revenue helps the government to provide public services and create development to the society. For an example, in Malaysia, the government focuses on the exchange rate and product price stability, also providing market access to foreign businesses and investors.

    Micro-economic is a theory which covers consumer behaviour (individual) and businesses to understand the buyers behaviour. Consumer behaviour is how people react or think before they make a decision to buy a product. Consumer behaviour changes time to time according to their need and preferences at the time of their purchase. A company in a particular region or location should understand the particular locations’ social ,psychological, economics ,personal and cultural factors in order to succeed in their business. For an example if company A starts their business in a small town where the people have the attitude to only eat local food (psychological factor) company A must come with an idea how to bring in local food or to emerge habits with new offerings which is near/close to local food for a start. It is very significant to consider the age factor , the culture and of course economic level of the majority of the particular location before starting selling a product or providing a service. If the majority has income less than RM 2,000 then there is no point in selling luxury products which may cost minimum RM 20,000. The company may emphasize positive new beliefs. For an example selling affordable new products which may give new experiences to the consumer and if they are happy , consumers will repeat the behaviour. Furthermore, during the lockdown last year consumers were frightened to go out for grocery shopping and majority expected for delivery services. Many stores offered delivery services after identifying consumers’ behaviour at the time of pandemic Every company must analyse consumers behaviours and also align with the consumers behaviour. All these factors are important to shape one’s business strategy in order to gain profit.