As marketers, we understand the depth of our customer knowledge and relationships defines the success of our brands and campaigns. Demographics offer one way to look at customers, but perhaps even more instructive is psychographics.
What is the difference between demographics and psychographics?
In broadest terms, demographics tell you WHO your customers are…while psychographics help you understand how they think and, most importantly, WHY they act. Demographic data includes age, gender, race, geography, education, annual income, and quantifiable information. Psychographics can be thought of as cultural data, offering a window into people’s worldview, into their habits and what makes them tick.
Why do psychographics matter?
Understanding people’s attitudes and values can reveal very deep insights into what drives them as consumers. When you understand why an audience prefers to shop in certain stores and why it buys certain products, you’re tapping into an incredibly valuable vein of information that can help you uncover buying patterns, anticipate trends, and predict which campaigns will most effectively drive conversions. Savvy agencies mine this data to inform everything from messaging to creative imagery to media channels, rotations, and the mix of touchpoints necessary to keep your brand in front of your desired audience at the right times in the customer purchase journey.
Psychographic data drives results by allowing you to:
- More effectively segment your audience
- Identify the factors that influence buying behavior
- Create messaging that truly resonates with your audiences
- Motivate customers to choose your brand
The best source for psychographic data? Social media
Traditionally, marketers have relied on customer surveys for psychographic data. While surveys have always had the drawback of being slow and costly to conduct, in an increasingly fast-changing marketplace they simply can’t keep up with consumers. That’s why, increasingly, marketers are turning to social media data for the reliable, real-time information they need about customers and prospects.
Social media is a gold mine of psychographic data in several ways. People tend to be more open and honest in their own social spaces than in surveys, and their social profiles offer a veritable treasure trove of highly accurate psychographic information. By monitoring social media feeds, you can understand what customers are actually doing rather than what they’re willing to tell you, or perhaps even believe, about their buying behaviors. Harnessed correctly, social media can replace focus groups, online panels and surveys, providing more timely, more accurate and less costly information. When you integrate all your sources of first-party data including social media, CRM, Web analytics, transactional data, etc. with third-party data, you get the truly comprehensive 360-degree view of customer values, needs and behaviors that can help you anticipate their future desires and deliver what they want when they want it.
Get started: Four steps to turning psychographic insight into action
Once you’ve used psychographic data to create more meaningful customer segments, you can leverage this deeper customer knowledge across your entire business to drive revenue. Four specific steps you can take are:
- Fine-tune your customer acquisition efforts with a more detailed understanding of customer segments
- Hone your messaging to speak more effectively to customers at each point in the decision-making process, increasing the rate of conversion
- Offer better customer service and more effectively cross-sell by giving your representatives deeper, more accurate information about the people they’re assisting
- Develop products that meet the needs of your largest customer segments
As consumers continue to become more empowered and more discriminating, marketers will need to find new and better ways of getting to know them in order to deliver the customized messages that will resonate and inspire action. Those brands that most effectively tap into social media data will have a distinct advantage in the marketplace of tomorrow.