7 min read
As a marketer, you’ll know first-hand that one type of marketing campaign won’t appeal to everyone. What interests one demographic, won’t necessarily attract another. Diving into the similarities and differences of your customers, such as age, ethnicity, income, occupation, family structure and gender, allows you to segment the market into categories and target your campaigns, products and services accordingly.
Grouping customers and potential customers by traits and characteristics is known as demographic segmentation, and it can be a great way for you to better understand your audience and their preferences to make your marketing appeal to them.
Here, we’ll dive into what exactly demographic segmentation is, how it works and how segmenting your audience can help you to better understand your customers and make informed marketing decisions.
What is demographic segmentation?
Demographic segmentation is a type of audience identification that takes audience data and splits it into demographic factors such as gender, age, profession, marital status, income, location, religion, and more. It aims to help you better understand both your customers and potential customers, and their needs and interests. You can then take this data and personalise your marketing campaigns, advertising and other materials to reach them with targeted messaging.
It’s one of the most commonly used types of marketing segmentation that allows you to speak directly to a defined target audience. It should help you better understand the similarities and differences between each audience group and what they are most likely to respond to. With targeted campaigns bringing in 77% of marketing ROI, personalised messaging can be a great way to connect with your audience and grow your business as a result.
When segmenting your audience by demographic, make sure your decisions are data-informed to avoid the reinforcement of stereotypes. It can be all too easy to make assumptions about your consumers. So, you must analyse your data and use demographic segmentation as a starting point before exploring other types of customer segmentation such as psychographic and behaviour-based segmentation. That way you can truly understand your customers’ motivations and buying habits fully, and avoid reinforcing negative stereotypes.
Dividing the market into segments should also help you to use your time and resources more efficiently. Say goodbye to generic messaging that tries to appeal to everyone with little success, and use demographic segmentation to create targeted marketing material that each audience group will resonate with - encouraging them to take an interest in your brand and convert.
What are the common demographic data points to segment by?
The common demographic data points to segment by can include, but are not limited to:
Categorising your audience based on gender identity is a process known as gender segmentation, which is a form of demographic segmentation. Under gender segmentation, your audience data is divided into male, female and other gender identities to understand their interests to help you target their preferences with your products, marketing and services.
While we know that customers appreciate personalised messaging, with 66% of customers expecting companies to understand their unique needs and expectations, it’s important to be cautious of crossing the boundary from segmentation to stereotyping. While you can market your product or service to different genders, assuming that men prefer a certain colour or style, for example, could run the risk of marketing your product to a narrower audience or turning them away from your brand completely. So, it’s important you get to grips with your audience and understand which gender identity prefers what type of marketing or messaging to encourage interaction, sales and leads.
Marketing that is aimed at and appeals to a child won’t generally interest someone in their sixties. This is why age is an important part of demographic segmentation. Splitting your audience data into age brackets can help you to target your marketing campaigns better. These age brackets are usually 18-24, 25-34, 35-44, 45-54, 55-64 and 65 and above. Here’s an example of how age segmentation can benefit your company. Let’s say you’re a supermarket and when looking at your demographic data by age group, you notice that 25-30 year olds are not buying breakfast cereals as much as older segments do. You would then look to target marketing campaigns towards the 25-30 year old demographic in order to change this and increase sales. You could look to position your breakfast cereals’ advertising as youthful and appeal to the younger demographic, via channels that your 25-30 year old audience use the most. With 71.3% of all TikTok adult users between the ages of 18 to 34, this platform could be your go-to channel to promote your brand and engage with your younger demographic.
Income and occupation
Segmenting your audience by occupation and related demographics, like income bracket or level of education, can be a useful marketing tool. Often, customers in different income brackets can have different approaches to making a purchase. Those in lower income brackets may be interested in items on offer or maybe more hesitant when it comes to buying and would prefer to shop around. Whereas, those with more disposable income may be more prone to impulse buying and happier spending more money on certain products.
As for levels of education, you’re likely to be familiar with students being the target of particular marketing campaigns throughout the year, particularly during summer when they plan on going to university and awaiting their A-Level exam results. Knowing your audiences’ education level can help you to plan and target your marketing campaigns to their particular interests and needs.
Ethnicity and religion
Grouping your customers and potential customers according to ethnicity and religion can benefit your advertising and marketing strategy. This is because a customer’s ethnicity and religion can play a part in their response to marketing, influenced by cultural experiences, interests, attitudes and beliefs. By knowing your audience’s ethnicity and religion, you can ensure your marketing strategy targets these values and beliefs and respects them too. You must approach marketing towards specific ethnic groups respectfully to ensure that your marketing doesn’t reinforce racial stereotypes, which may offend potential customers, drive them away and affect your brand’s reputation.
Family structures can play an important part in an individual’s buying habits and preferences. Knowing your customers’ familial situation can help you target people at different stages in their lives, as often when a family dynamic changes, their needs and buying habits do too. For example, those with large families may prefer marketing campaigns that reference helping with or bringing up children. Couples with several children are likely to have different needs or circumstances than those who have just had their first baby.
It’s important when segmenting your audience not to make broad assumptions - while you could assume those who are single may have more flexible spending patterns, it’s important not to make broad assumptions as this could alienate your audience and reinforce social stereotypes. The end goal of this process is for you to better understand your buyer personas and customers for you to deliver them the messaging, products and services they are truly looking for.
How can demographic segmentation be used?
Demographic segmentation is a valuable method that can help you better understand your customers and improve your marketing strategy. Instead of trying to target a broad customer base with your marketing, you can use this method to appeal to specific audiences.
It can be used in a variety of ways and can benefit your marketing strategy by:
- Establishing strong customer relationships: Demographic segmentation can make your marketing appear more relatable and ‘human’ to your customers, as you know exactly the type of customer you’re targeting and what appeals to them. This can allow them to identify with your brand as they will feel like you understand their needs, which can make them more likely to stick with your brand and continue to buy from you in the future
- Improving your marketing strategy: Demographic segmentation allows you to enhance your marketing strategy, as you’ll know exactly who you’re going to target. If you find out that the majority of your customer base is aged 25-34, you can ensure your marketing targets this age group in particular. This approach can help ensure that your marketing strategy is suitable for your customer base, making the time and money you’ve invested into your marketing worthwhile.
- Enhancing your product/service: Demographic segmentation should improve your offering as it shows the demographic segments in which you do not have good market penetration at the current time. For example, suppose you’re a skincare brand and notice an increase in customers who are men aged 55-64. In that case, you might introduce a new anti-ageing skincare range explicitly tailored to this audience.
When should I use demographic segmentation?
Once you’ve identified your target market, you can make adjustments to your marketing strategies to appeal to this segment, which can improve the effectiveness of your marketing efforts. You can use demographic segmentation to streamline your marketing while getting to know your existing and prospective customers better.
An example of when you could use demographic segmentation to improve your marketing strategy is if you notice a sudden decline in sales, website traffic or engagement from who you initially thought was your primary demographic. This can allow you to look at your audience data, where you may notice a change in your primary audience, such as a different age or ethnic group. Once you’ve segmented your audience, you can use this information to realign your marketing strategy to appeal to this new, redefined audience and see an increased ROI as a result.
It’s important to note that demographic segmentation alone isn’t sufficient to fully understand your customer, their needs and preferences. By combining psychographic and behaviour-based segmentation with demographic segmentation, you’ll have a stronger understanding of your customer’s preferences, and be able to target them successfully.
See how Apteco can help you segment your audiences
Making use of your audience data can offer valuable insights into your customers’ interests, needs and preferences. Segmenting this data into categories can help you get to know your customers and potential customers better, and in turn, make changes to your marketing strategy that will appeal to them.
Apteco’s Audiences tool within the Apteco Orbit™ platform lets you build audience segments for your campaigns and quickly export the data. It can help you create, refine and share campaign audiences with colleagues so you can make informed marketing decisions.
Want to learn more about Apteco’s audience building? Get in touch with our team to find out how you can build audience segments for your campaigns or book a demo to find out more.