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How Do Demographics and Psychographics Work Together?

by | Jun 1, 2015 | Analytics & Data Management

Today, consumers are getting bombarded with advertisements. They simply don’t have time to read, much less respond to, every ad fired their way. They are more diverse, complicated and they expect more than ever before. They respond best to ads that speak, or resonate, on a personal basis to who they are.

Effective market segmentation allows you to focus on this subset of prospects that have the greatest potential of becoming, and staying your customers. With market segmentation, you are better able to more precisely meet the needs of your potential customers, which in turn will improve your profitability.

Two very important market research tools that work well in tandem to find your best segment are demographics and psychographics.

Demographic analysis is a lot like a census. It describes your target audience by telling us about the who, but does not give us the details about the what, why and how your audiences behave the way they do.  Demographic data does not draw on conclusions. It is external, fact-based – data that can be categorized and classified.

Psychographics Analysis (otherwise known as Lifestyle Analysis) helps us to dig deeper to discern and to understand personality, values, attitudes, interests, or lifestyles of our target audience – what is significant to them and how they make buying decisions. Psychographic information is often referred to as the IAO Variable (interest, attitude and opinion) and is extremely valuable to us as marketers. Psychographics is not quantifiable with numbers and is more subjective in nature.

Because psychographics is based on demographic data, it must be created after demographic profiles have been created. Not only are they related, but each affects the other. Critical information could be missed if psychographics is used alone.
Psychographic research uses analytic techniques derived from both psychological and sociological sciences.

Though psychographic data can be acquired by various methods, it is basically collected in one of two ways – directly (through market research interviews, surveys or focus groups) or inferentially, by making assumptions about attitudes and beliefs based on people in similar groups behaving in similar ways. The second method is not as accurate but does work well.

Once you have you’ve collected your psychographics, you can now create customer profiles – those customers that you keep in mind when writing content. Name them, give them a back story. You can make them as real as possible. Now, you will start to see your marketing programs and campaigns reach new levels you had only hoped for.


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