Understanding why your customers buy
Is the data you're collecting really enough to understand your market?
Psychographic segmentation helps you get into the mind of your consumer.
Most forms of market segmentation are about basic levels of information: the who, what, when and where of your customers.
The really useful and really tricky intel comes from measures that go further and ask "why?". These behavioural measures are called psychographics. And once they're mastered, they can have an exponential effect on your business's bottom line.
They think, therefore they are
Psychographic segmentation relies on data which goes beyond traditional demographics. It measures stuff like lifestyle characteristics, activities, habits, social standing, interests and opinions.
This information can help you develop "personalities" for certain groups of people, which becomes a useful working reference to help you tailor your product and messaging in more meaningful ways than simply where your customers live or how old they are.
Like all things to do with the brain, psychographic segmentation can become a bit complicated. But here are some introductory ideas to help you wrap your head around it.
How does your segment live?
Lifestyle, in a psychgraphic sense, shows the choices a segment makes based on their distinctive priorities in wants and needs.
That is, lifestyle psychographics looks at how a group of people lives, and then searches for broad trends in their choices.
A great example is camping enthusiasts. In general, these are people who love the outdoors, but they're a lifestyle segment that shares little else in common. You can't find them by where they live or how much they earn because they range from redneck roo hunters, to families, to tree-hugging eco-warriors. You simply find them by identifying what matters to them most.
Who does your segment hang out with?
Most of us admit our social surroundings influence how we live.
Social class, wealth, taste, power, political orientation and educational achievement - all these things matter because spending power is not the same as spending habit.
The general rule is that each member of a psychographic segment responds to products and services that can maintain or improve their position within their segment.
For example, UK-based MarkMedia identifies "esteem seekers" - a hyper-consumerist and hyper-competitive segment which spans generations and geographic boundaries. Similarly, "traditionalists" may not have a common age or race, but are united by a strong avoidance of taking risks or standing out from the crowd. You can often tell more about how a customer spends their money using these classifications than by knowing whether they are male, female, a Baby Boomer or a Gen Y.
Understand and win
Because we're talking about psychological patterns rather than facts and figures, it can be tempting to dismiss psychographics as too messy to bother with. But with a bit of reflection and research you really can get into the heads of your customers and know how and why they act.
Now there's a competitive advantage you can't afford to ignore.
You can never know your customers too well. Take your business to the next level with CCIQ CRM.
CCIQ CRM is an affordable and easy-to-use customer relationship management system which puts your customer data in one secure place where you can access it anywhere, at any time, on any device.
Sign up today for a free 14-day trial – no credit card is required.