Why are demographics so important for making marketing decisions?

June 27, 2022

Every successful business utilizes the power of demographics to make sound marketing decisions.

When businesses gather and analyze demographic data, they can better understand the characteristics of the people who purchase their products or services. In turn, that means the right marketing avenues can be explored.

Let’s take a more detailed look at why demographics are so important for making marketing decisions.

 

 

What exactly are demographics?

You’re sure to understand what’s meant by customer data, but you may be a little confused as to what demographics actually means.

Well, demographics refer to the socio-economic characteristics of people that are utilized by businesses to identify things like the purchasing behaviors and product preferences of their customers.

Demographics cover a wide variety of data points, including but not limited to: customers’ age group, gender, race, ethnicity, family status, employment status, income level, and location.

Armed with demographic knowledge, companies can target specific markets and create appropriate marketing materials. Demographics can also affect other factors like pricing, packaging for your products, and special offers.

When marketing campaigns are aligned with customer demographics, your conversions and sales are very likely to increase.

 

You Can Target People Who Are Actually Interested in Your Products or Services

Some salespeople still knock on the virtual doors of people even when they know that those people aren’t interested in their products or services. Those salespeople are wasting their time.

When you have access to demographic data, your marketing and sales teams can spend more time targeting potential customers who are actually enthusiastic about your products and services and stop spending time and resources targeting people who simply aren’t interested.

 

You Can Market to Generational Groups and Specific Age Ranges

When you have access to demographic data, you can much better understand the generational groups and age ranges that buy your products and services and therefore target your marketing efforts towards those specific groups.

For instance, if the overwhelming majority of your target audience is young, you can target platforms that are mostly used by young people, such as TikTok. Bear in mind that generational groups and age ranges are two distinct things.

The term “generational groups” refers to groups like baby boomers, generation X, and millennials. Each generation has different buying habits. So, by knowing which generational group you’re targeting, you can find the appropriate ways to word and present your ads.

Age ranges transcend generations. You can use demographic data concerning customers’ age ranges to target potential customers much more accurately.

For instance, if you sell life insurance, you can identify married couples in their late twenties who have just had their first baby and are therefore more likely to start thinking about life insurance.

 

You Can Market to People with Specific Ethnic Backgrounds

People from different cultures can have different tastes, priorities, and buying habits.

So, knowing the ethnic backgrounds of your customers can assist you in targeting the right potential customers and using the appropriate imagery and wording in your marketing campaigns.

Knowing about things like cultural traditions and holidays can also help you target certain groups of people better.

 

You Can Market to People Who Have Families

If your products or services are geared towards families, it will obviously be valuable to target your marketing campaigns towards adults with children.

Knowing whether a person is single, married, or divorced can help your marketing efforts in various ways because families can have different buying habits than other target groups.

If you can discover who is the main decision-maker out of a married couple, you can further target your marketing campaigns more specifically.

 

You Can Market to People of Certain Income Levels

 

If you’re selling high-end, luxury products, you won’t want to waste your time targeting potential customers who are on minimum wage.

The reverse is true, too. If you’re selling affordable products that most high-end customers wouldn’t consider purchasing, there’s no point in targeting people who are wealthy.

You can make all kinds of informed marketing decisions when you know the income levels of your customers, so that’s one demographic you should most certainly find out.

 

You Can Focus on Niches

Niches, in terms of customer demographics, refer to specific niche customers such as a married woman who is also a pet owner or a single man who is a business owner.

By looking at such niches and focusing your marketing campaigns on specific niches in the right way, you could see quick growth.

For instance, a married woman with a dog and a high income is more likely to spend money on her dog than a single young man. So, if you sell dog accessories, you can target married women with dogs.

The key to niche marketing is to speak to customers’ emotions. Get niche marketing right, and it can be a very effective marketing strategy.

 

You Can Make Marketing Decisions Based on Customers’ Locations

While most marketing efforts are online these days, don’t forget about good old-fashioned marketing campaigns like posters, billboards, and ads on local radio and TV stations.

If you find your customers are located in specific areas, after analyzing demographic data, you can advertise in local areas to reach your target audience.

Speaking of customers in local areas, you can make your company appear as though it’s located in the area where the majority of your customers are by getting a phone number for the locality.

For instance, if your customers are mostly based in Canada but you’re based in the U.S., you can build customer trust by getting a Canadian phone number.

Furthermore, when you know the locations of your customers, you can target your marketing accordingly. For instance, people in urban areas are more likely to purchase public transport apps than people in rural areas.

 

You Can Create Appropriate Visuals for Your Marketing Campaigns

This was briefly mentioned earlier, but it deserves more attention. When you know the demographics of your customers, you can enhance the wording, imagery, and vibe of your ads to suit your target audience.

For instance, you could reach out to young people better when you use bright colors and on-trend words whereas a classy ad with elegant lettering would be better for attracting the attention of high-end customers.

By understanding the demographics of your customer base, you can adapt the visuals of your marketing campaigns in appropriate ways and attain more conversions.

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