Today’s experienced marketers know how important customer segmentation is for discovering and engaging with prospects and leads. While demographic, geographic, and behavioral segmentation are based on who individuals are as consumers, it’s just as important (if not more) to know who they are as people. That’s where psychographic segmentation comes into play.
The main difference between demographic and psychographic targeting is that demographic (as well as geographic, and even behavioral) segmentation focuses on quantifiable and visible information. Psychographic marketing focuses on internal and intrinsic characteristics.
What is psychographic segmentation and why is it important?
Psychographic segmentation divides buyers into different segments based on internal characteristics — personality, values, beliefs, lifestyle, attitudes, interests, social class — so you can market accordingly. It requires looking beyond customers as they pertain to your brand, and seeing them as individuals in their own lives, like this:
This ad would hit home with someone who values using environmentally-friendly products to save the earth.
Psychographic marketing takes into consideration:
- What your customers value in life
- Pain points they face
- Why they act the way they do
- How you can help in a way they will find valuable
Based on those factors, you can adjust your offers, marketing messages, and advertising channels to provide maximum value to your target audience and connect with them on a more personal level.
Getting to know potential customers on a deeper level allows you to provide them with highly personalized advertising (a more personal value proposition), increasing the chance of a sale.
Collecting psychographic data
Collecting psychographic data is a bit different than collecting more objective data like demographics. It requires looking beyond the most obvious, obtainable information, and digging deeper — to the data beyond the data.
Surveys can improve your understanding of prospects and customers, essentially acting as interviews with them. By asking the right questions, you can learn what your audience’s personality is, what they enjoy doing in their spare time, their lifestyle, what they value most in life, and lots of other information that can be used for segmentation.
While every industry and company’s psychographic segmentation survey questions will vary, here are a few generic questions Formilla suggests asking:
- What are your biggest struggles with [area relating to your product or service]?
- What are your goals in [area relating to your product or service]?
- If [your product or service] could [free X hours, save X dollars, etc.], what would you do with the extra time/money?
With that, let’s get started with the different types of psychographic segmentation.
Psychographic segmentation variables with examples
There are three main psychographic targeting variables, each of which is broken down into subcategories. Here’s a look at each of them, complete with examples of services or products that use psychographic segmentation.
When segmenting by personality, you must consider factors such as their beliefs, morals, motivations, and overall outlook on life. Joseph Chris Partners breaks down personality into the following subcategories:
This is the most common psychographic personality type in the United States. These individuals are more “mainstream” than those in the other categories, always wanting to fit in with their families, friends, and community. They constantly seek to fit a common mold, not wanting to stand out in a crowd, feel isolated, or experience change.
People in this category are very ambitious, always busy, need to constantly be productive, and dislike anything they feel is a waste of time. They tend to be materialistic, in that they purchase luxury items to symbolize their success in life.
These people want to be Achievers, but they’re missing either the skillset or work ethic to get there. Instead, they make large purchases they can’t afford and buy knock-off products to appear successful.
Saviors aim to achieve greatness for the world as a whole, instead of just for themselves. They’re socially-conscious people who go out of their way to help others and the world around them, and rarely (if ever) ask for anything in return.
Here’s an ASPCA ad that screams out to Saviors:
These people are the exact opposite of Saviors, seeing nothing but doom and destruction for the human race. They march to the beat of their own drum, trying to be as self-sufficient as possible. This personality type tends to have a strong opinion about almost anything.
Integrators are Achievers plus Saviors. They strive to earn as much money as possible, but then spend it on philanthropic efforts, rather than themselves. This is the least common psychographic personality type, with only 1-2% of people fitting into this category. Examples include Andrew Carnegie and Bill Gates.
These individuals struggle to earn a living wage, working paycheck to paycheck, either through their own choices or because they were brought up in a poverty-stricken environment. They don’t plan purchases, but they don’t spend money haphazardly either, because they’re constantly afraid of losing everything.
It’s important to note that these subcategories are only suggestions from one company. Your company’s data might warrant creating different personality subcategories to define individual customers and implement your own psychographic advertising strategy. Either way, the point of segmenting consumers into these categories is to determine which subcategories are most likely to get value out of your product or service.
Lifestyle is the most concrete insight into what someone truly values, or how they spend their time and money. For a clear picture of this, you need to analyze three dimensions of their life — activities, interests, and opinions — commonly referred to as “AIO Variables:”
This subcategory includes:
- The activities a person enjoys (and will spend money on)
- How much they enjoy and engage in those activities
- The way they make purchases on those activities
For example, someone interested in playing soccer needs to purchase a soccer ball. However, depending on how much they plan to play, they might also purchase cleats and shinguards. If they plan on playing frequently or competitively, they might invest in private lessons or a local league membership.
What’s more, two people with the same activity level might also vary in how they make purchases related to the activity. While one person might conduct their own research on which type and quality of cleats to buy, another might consult a peer or a specialist. Furthermore, the amount each person spends on different cleats could also differ.
Someone’s interest level refers to the excitement they get from engaging with (or thinking about engaging with) something. Everyone’s interests and hobbies vary and knowing this can bolster your marketing efforts.
When researching a prospect’s interests, start broad then narrow your focus as you begin to understand more about them.
For instance, if you have a meal delivery service, market first to those who enjoy spending time with their families, since a meal delivery service will free up time. Then, also target those who value their health, exercise regularly, have dietary restrictions, etc.
Daily Harvest does a great job targeting several different interest segments, all of which would likely be interested in this meal delivery service:
Notice how they promote time efficiency in the description and video, but also healthy, nourishing food in the video as well.
A person’s opinion or attitude forms the baseline in which they determine it useful and important. It is created by a combination of:
- The degree to which something is logically important to their life
- Their deep-seated beliefs, or preconceived notions about something
People often have strong opinions on religious, gender, politics, environmental, and cultural topics — all of which can have a huge impact on the products and services they buy, and even how they respond to your advertising messaging.
3. Social class
When marketers consider social hierarchy when developing their psychographic targeting efforts, it’s mainly because different social class’ purchasing power. If you target the wrong social class, they won’t be able or willing to purchase from you.
This idea can also be applied to account-based marketing. For example, if an enterprise software company wants to reach C-suite executives, they need to segment and target higher authority employees.
That said, here are the most common social classes the population is divided:
These are the richest of the rich. For the most part, they’ve inherited their wealth, and have never had to deal with financial struggles. They tend to spend lavishly, without much consideration for price.
These individuals earned their wealth themselves, rather than inheriting it. They know how much effort (and sometimes luck) it takes to reach the level they’ve reached. They don’t spend money as lavishly as the top-upper class, but they aren’t afraid to purchase what they want either.
Similar to bottom-upper class individuals, these people don’t squander money, but they can afford to provide themselves and their families with the “finer things in life.” Members in this category are in a comfortable enough financial situation that they can focus on growing their career.
Here’s a psychographic segmentation example directed at top-middle class members who may be interested in growing their business:
These are white- or grey-collar workers who live “conventional” lives. They can provide the basics for their families (food, shelter, clothing, etc.), along with some occasional extras (large purchases are made with careful consideration based on finances and logistics).
This Carnival ad would most likely be shown to someone in any of the classes above, as they are the only ones who could afford a cruise:
It would be careless to show it to someone in either of the two the lower classes, because there is little chance they would even consider spending what little money they have on lavish vacation.
This class consists of blue-collar workers who earn just enough money to get by and no extra. These people are always in “defense” mode, looking to work as much as possible and save as much as they can.
These individuals are either underemployed or unemployed, and live well below the typical standard of living. They spend what little money they do make on the bare essentials, and sometimes, must even forego the essentials.
Many of these categories and subcategories coexist and overlap with one another (e.g., a Survivalist would also be a member of the lower class). These segments may also cross with other segmentation methods (think demographic segmentation — income — in terms of social class).
Get to know your audience as individuals
Digital relationships between prospects/customers and companies can often feel disconnected and inhuman. More than ever, marketing teams need to implement sophisticated techniques like psychographic segmentation in their advertising efforts — because the better you know a person, the more personal value proposition you can offer.
Once you’ve tweaked your marketing initiatives to reflect the psychographic data, get more out of your post-click opportunities with the Marketing Optimization Opportunities guide here.