It's 2018 and the power is with the individual. In fact, brands like Glossier have built empires based on this assumption. And with every customer armed with a personal social-media-megaphone, unlimited access to information, and "citizenship" in hundreds of different digital micro-communities, demographics alone cannot provide adequate information about your clients.
A decade ago, segmenting your audience based on age, gender, marital status, etc. provided insightful information. Businesses created "ideal clients" based on such information and generalized groups of people by the way they appeared on a postage label.
But today, this information alone tells us little. Today, a 35-year-old woman (let's call her Reya) could have more in common with a 65-year-old woman than she does with another woman her age. What's more, she could have more in common with a 35-year-old male than she does a female. Her career may be transient and flexible. She may adjust her brand preferences as often as she does her laundry. She may have no permanent address and live half the year travelling as a digital nomad.
Understanding Reya in broad-stroke categories does not tell us anything about how she behaves, what she values or what motivates her purchase decisions. What's more, the demographics attributed to Reya pidgeon-hole her and can lead to assumptions about her behaviour and character.
Psychographics, on the other hand, can help us understand what is in Reya's heart and mind.
Psychographics are psychological demographics or attributes applied to personality, values, opinions, attitudes, interest and lifestyle. Understanding Reya's psychographics can paint a much more complete image of who Reya is. It can be said that Reya values health and wellness and supports LGBTQ rights and gender equality. She is interested in digital media and meditation and mindfulness. She spends her time working from cafe's or out of her apartment and believes spending her money on experiences is more beneficial than spending her money on things.
Now, let's apply the model to a product we are trying to sell. Let's say the product is a Harley Davidson motorcycle.
*Insert stereotypical image of a man riding a Harley Davidson into the sunset*
Using the demographic model, we may target caucasian male accountants between 40 and 60.
Using the psychographic model we may target people who value freedom, rebellion, and a sense of belonging to a community.
As it turns out, Harley Davidson is the number one seller of motorcycles to women, African-Americans, Hispanics, young adults and baby boomers. Using the demographic model alone would miss major segments of Harley's best customers.
It's 2018, and the power is with the individual. It's time to adjust your segmenting model and think about your customers in terms of psychographics in addition to tradition demographics.
And as Glossier founder, Emily Weiss, suggests, if you want to engage your customer, engage her--But, this only works if you first understand her.