Demographics have always driven marketing. For decades, retailers have classified customers by age, income and geography. But those classifications – even when blended with psychographics – do not take critical motivating factors into consideration. Is it time to move beyond demographics?
The Limitations of Demographics
Traditional demographic categories provide a window into a customer base, but those stereotypical categories can be limiting. Take, for example, three hypothetical ‘fortysomething’ women from the same socioeconomic background, all married with two children and all with similar-sized, four-bedroom homes in the same suburban subdivision. Demographically, these women are indistinguishable. However, beneath the surface, they are all unique when it comes to personal style, taste and preference.
A customer’s style arguably has more impact on what they will buy than their demographics may indicate. Consumption patterns are not driven by traditional economic segments and shopping patterns do not fall into neat demographic buckets.
Today, consumerism is all about what’s relevant to the individual and any message that is not relevant to the individual will be ignored. Let’s revisit our three fortysomething suburban moms. Remember, they are indistinguishable. However, Mom 1 has a more modern sense of style, Mom 2 is more classic in her taste and Mom 3 is more contemporary. If all three women receive the same advertising messaging showcasing a classic-looking sweater advertised for 40% off, it will only catch the attention of Mom 2.
However, if Mom 1 receives an ad with a modern sweater and a compelling discount, Mom 2 gets the classic ad and Mom 3 gets a more contemporary look, all three will take notice. Data is a key driver of post-demographic consumerism. Customers respond to messages that appeal to their personal tastes, interests, preferences and values – and relying solely on demographic markers to communicate with customers can limit a retailer’s ability to personalize.
Post-Demographic Marketing In Action
Amazon and Netflix recognized the post-demographic consumer years ago, and they quickly moved to understand their users on a deeper level. Rather than using basic stereotypes and traditional customer classifications, they leveraged algorithms to deliver recommendations to customers.
People are more than just their income, address, gender and age. These are all factors that impact how they see the world and do influence purchasing, but they provide a shallow and short-sighted view of the individual. Style and identity are equally important to demographics – if not more.
Not every retailer has the deep pockets of Amazon and Netflix, but that does not mean similar tactics are out-of-reach. Retailers that collect data have the ability to craft and leverage style profiles of their customers—the experts at Lift361 can help with this. Those profiles can be used to drive significant incremental value, making communication more effective and lifting sales.