Do you Really Know Your Customers? Marketing to a Rapidly Diversifying Population
by Karen Talavera
03 31, 2011 | Posted in Customer Loyalty, Email Lists, Targeting & Segmentation | 0 comments
The U.S. Census Bureau releases the results of its 2010 census this summer and marketers are advised to prepare for some major demographic shifts. In a recent interview I read of Peter Francese, consultant to advertising megalith Ogilvy & Mather and author of the research report 2010 America, I was surprised to learn:
- There is no more “Average American”. Fifty years ago the concept of John Doe, an average American in a relatively even society where vast numbers of people had the same sort of consumer needs, was real. There existed a uniformity of society that has never since been equaled. The 2010 census puts the nail in that coffin.
- We are a true multicultural nation. In the two largest states in the US – California and Texas – no race or ethnicity is a majority of the population anymore. In fact, in our ten largest cities no segment is the majority.
- Family life is diversifying. Twenty-five years ago, two-thirds of all households were married couples. The 2010 census will show that for the first time in American history, married couples will be a minority in the US. The number of people living alone is growing rapidly.
- We have become a multigenerational society. Average life spans have significantly increased. With more people living longer than in previous generations there are greater numbers of multigenerational households than we’ve seen historically. This means that older people (aged 60+) are living with their children and/or grandchildren and have a bigger impact than ever before on what those younger generations are buying.
What this means for your marketing is obvious: one-size-fits-all messaging isn’t going to cut it. It will seem wildly off-base and irrelevant especially if you attempt it in your email and social media marketing – avenues where instantaneous feedback and listening is expected. So especially when it comes to your online messaging, I recommend adopting these three approaches in creating a new relevancy mindset for your email, mobile and social marketing programs:
- Demographic segmentation matters and should be tested. That means investing more time and money in database building and management so you can segment by important demographic criteria like age, gender, location, household composition, marital/family status, and ethnicity. Any life-stage marketer can attest to the wildly different consumer needs of new parents, new movers, families with children and empty-nesters. By not targeting those segments specifically you’re missing huge opportunities to make specific, timely offers to each and reap the benefits of relevant, engaging, useful messaging that speaks to them “where they live”.
- Recognize, identify and reach influencers. Marketing isn’t a straight line between brands and buyers–influencers play a role, and never more than today. Social networking makes getting group opinions and feedback easier and more far-reaching than ever. No longer are influencers limited to immediate family and friend circles – total strangers can become trusted, credible sources for data that influences purchase decisions – positively or negatively – in much more accelerated and mysteries ways than before. The upshot? Your target market isn’t the only group that needs your messages. Remember the influencers and reach out to them as well.
- Don’t Assume: Analyze & Ask Instead. For decades, profiling and clustering systems have made predictions and assumptions to classify customers or prospects into similar groups for marketing segmentation. Such systems use demographic and marketing data points to categorize customers or prospects into distinct groups that supposedly fit a certain lifestyle or behavioral profile. While useful, there are two shortcomings of these segmentation systems: 1) because of the diversifying population, cluster system categories are becoming more numerous and granular, resulting in more groups with fewer members each – sometimes too many segments to meaningfully execute to, and 2) people fit into more than one cluster, sometimes seemingly contradictory.The bottom line is such systems are less effective at profiling database members than those individuals’ own stated preferences and demonstrated behavior. So, leverage online surveys often, continually asking list members what they like, don’t like, want to hear about, etc. – then watch their response behavior for confirmation of their stated opinions and intentions. In the end, actions speak loudest, so model future marketing approaches on what proven behavior from your target audience has shown they respond to in the past.
Until you dig deep into your customer data – demographics, offer responses, media preferences, survey answers and more – you may have assumptions about your customers that are entirely untrue. Your customers are probably a far more diverse group than you imagined, and unique segments deserve unique treatment. Make it standard practice to revisit your segmentation methods and re-assign individuals to new segments as their behaviors – or demographics (like age) – change.
Continually re-balancing how and if you can group customers into like segments increases your ability for super-specific marketing that resonates, engages, and maximizes response. Market to “the average” and you’re marketing to a myth. Instead, get to know who your customers really are and be prepared to invest the time and resources needed to connect with them as individually as you can. The companies that do already have a clear competitive advantage in diversifying America.
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