Demographic profiling is not a new practice. What is new though, is how modern marketers are using tools that are able to analyse billions of social media posts and profiles to better understand their target audience and speak to them more effectively.
This type of analysis gives a deeper understanding of the mindset of your customer, their tastes, opinions, and values. This in turn allows marketing messaging to be tailored to complement a person's behaviour and emotional state. Smart brands are using this information to align themselves with customers in ways never before achievable.
This article will give you an overview of how demographic profiling works and provide a step-by-step guide to getting started with understanding who your customers really are.
What is demographic profiling?
In its simplest form, demographic profiling is a way of understanding who your target customer is and gathering general traits about their life (and buying habits) that will help you target them. It works best when you have large pools of data to draw from.
You gather together all the information you can on your customers and start to look for patterns. For instance, if you’re selling toys for young children, you’ll probably find the common links between your buyers are that they’re more likely to be female, between the ages of 20 and 35. If your product is holidays on a cruise liner, your customers are more likely to be retirement age. Those are very broad traits though, you can go deeper than that. If your product is more expensive than average or supports a premium lifestyle, you’ll likely find your buyers will earn higher than average wages and live in certain areas. You can then start to understand other things they enjoy, such as certain hobbies and pastimes or holiday destinations, and even political leanings and opinions on world events.
Notice that I’ve made some assumptions there, that is not demographic profiling (that’s just guessing). What demographic profiling is, is looking at hard data to find out the facts of who the target audience is.
This is really about understanding your average customer (the types of people who want what you sell). If you know what is working and who converts into sales, you can target more of those types of people. There are lots of ways companies have done this type of data collection in the past through things like surveys and account profile building. There are more efficient ways to do it now though (that don’t break GDPR guidelines).
How does it work in the modern (social) world
One of the benefits of social media is it gives us huge amounts of data to investigate. The big tech companies know much more about the people using their platforms than any other businesses ever have. That data can be exposed and with the right tools, leveraged in a legal and ethical way* to provide insights on how people behave and interact with the world.
An individual’s digital footprint is much larger than most people realise. There is the information you upload to your social profiles like your age, where you live, what job you do, etc. Then there are all the posts you make that identify the things you like, where you hang out, activities you enjoy and who you appreciate or dislike. Every like or comment you make, repost, or share is logged. Even things like metadata from the images you upload can be tracked. EVERY single interaction you make when logged into a social profile is recorded, and the platforms we use are gaining ever wider reach.
All these interactions get added to vast pools of data which are constantly being analysed. People like to think they’re individual but humans share many traits and characteristics, so common patterns can be easily found. To a trained data analyst, building a persona profile around certain types of people is easy when you have enough data to work with. The market for tools that access this data is growing at a steady pace, meaning access for the average business has never been easier.
*This means using anonymous data that cannot be traced to an individual, or used for harm.
The tools available to help
There are lots of tools available to help you build your consumer demographic profile. They vary in function and feature, and also price points. We certainly haven’t used them all and I encourage you to research the right tool for you. Here are a couple of tools that I think are worthy of a mention though to give you an idea of what’s available.
Audiense
Audiense is a great entry-level tool for demographic profiling. It provides access for anyone who has even just a small research budget and can scale as your requirements do. We’ve begun using it as a starting point for general audience investigation and it's proven very useful on several projects.
It works by indexing large amounts of social data and provides deeper insights into the type of people you want to know about. You access this by building an audience (using target keywords and accounts), identifying for instance people who post about a certain topic or who follow specific profiles. Once you’ve created your target identifiers, the platform will do its magic and return the deeper insights on that group. What you get back is very impressive. You can learn about location and gender demographics, socioeconomics, interests, the types of media they consume, who they are influenced by, their online habits, and some really interesting data around psychological traits.
Relative Insight
Relative Insight is a text analysis software tool capable of reviewing and spotting common trends in large amounts of text data. It can be used for all sorts of purposes. Where we’ve seen really useful cases though is for companies doing brand listening activities on social media, using the software to review huge amounts of social posts, comments, and reviews to understand what people are saying about their products.
This can be useful for general feedback and highlighting concerns but we’ve also seen cases where traits among certain customer segments have been identified and used to adjust messaging for some really impressive sales increases. This isn’t a free tool but for companies with a budget for this type of work it's really worth checking out.
The power that comes from knowing your audience
After completing a demographic profiling exercise, the insights you will gain will be extremely useful. When you really understand the type of person who is more likely to buy from you and the nuances of how they act and think, you can target your marketing efforts for the best results.
There are several strategic actions you can take, with this information. Here are some ideas:
- Targetted marketing campaigns: Tailoring your messaging to the preferences and needs of different customer segments. Also, understanding where your customers are likely to be, means you can choose the right channels (social, email, traditional outlets) to reach them effectively.
- Improving your website UX: Designing your site to be more appealing and user-friendly to your target audience so they are more engaged and want to buy from you.
- Content Strategy: Developing content that appeals to your customers (articles, videos, audio), and choosing the right channels to release it on.
- SEO and online visibility: Tailoring your search potential to meet the needs of your audience (ensuring you appear in results that they search for).
- Personalised shopping experiences: Customising your shopping experience for individuals to promote product recommendations and to cater for the browsing habits of different groups.
- Optimising pricing strategies: Ensuring your price points align with customer expectations and adjusting promotions accordingly.
- Cross-selling and Upselling: Identifying where you can add additional value and promote related product sales.
- Community building: Fostering a sense of community among customers by creating social value, interaction and engagement with brand values.
These are just some of the things you can do once you have a better understanding of who you are selling to. I would encourage you to start small with your investigation work and let the actions grow organically as you build more insights.
A guide to conducting a demographic profiling exercise
Ok, so how do you actually go about building your customer demographic profile? It’s not as difficult as you might think, but there are some important steps to consider. Use this guide as a starting point and amend to suit your needs as you gain confidence in this type of work.
Define your objectives
It’s important to first consider what you want to learn before delving into data, to avoid getting sidetracked. You may be looking for generalised insights, like age, location, and purchasing habits. Or it could be something much more specific that relates to your product proposition. Understanding what you want to get out of the exercise will also help you sell the idea to other stakeholders.
Gather data
Collect the data you want to analyse. The best place to start is your internal systems: website traffic, ecommerce demographics, sales reports, CRM data, etc. Once you’ve exhausted those sets, augment them with external sources such as those listed above or broader market reports available for your industry.
Segment your data
Group customers based on different demographic criteria (age, income level, education, etc), then add to that anything specific to your goals. There are several ways to start organising your data:
- Most analytics tools you’re likely using will have some form of reporting built in. Google Analytics for example has a suite of reporting widgets that will give you quite in-depth results. These will help you move forward quickly, so utilise them before trying to build your own
- If you’re segmenting data that is from various sources, dumping it into a spreadsheet is a crude but effective way of starting to split things out. It will help you get a sense of your data landscape without worrying about prettying it up (that can come later)
At this point, don’t be tempted to work too hard on making it look nice. This is about raw data and getting things in some sensible order. You can use multiple tools and just take screenshots to keep a record in the early stages.
Identify patterns or trends
Look for common characteristics within your segments. For example:
- Most Popular products between age groups
- Amount spent from different geographic locations
- Seasonal trends
- Changes in purchasing behaviour over time
Also, look out for more specific niche insights:
- Are people who lean toward certain types of media attracted to specific offerings?
- Did a particular marketing campaign land well with a certain segment of your audience?
Highlight these where you see them and consider ways to tag them so they can be identified more easily in future.
Review against your specific objectives
Now go back to the objectives you defined earlier. How do the trends you’ve seen compare against them? Are there any glaring insights that will help you move forward quickly, or do you need to look deeper at patterns in your customer behaviour to draw meaningful conclusions?
Perhaps what you’ve learned so far contradicts your earlier assumptions. If you do find that, you can be confident this was an exercise worth doing and you’ll need to reflect on how you move forward from here.
Create a report on your findings
Once you’ve assessed your data and are sure you have some insights to share, put them into a report of some kind. This does not need to be beautifully crafted, but it will help if it's easily digestible by anyone reading. The point of this whole exercise is to learn how you can make changes to your offering or marketing that will improve sales. It’s important then to be able to share this data with stakeholders and others in the business so they know the reasons why you’re suggesting changes should happen. Make it scannable with the top headlines easy to find, and include more in-depth analysis for those interested in understanding to a deeper level.
Draw insights and plan your next steps
Now is the time to decide what you are going to do with your newfound insights. Reviewing your initial goals again is a good idea, although you may have found out something about your audience that requires a radical rethink.
- Use the insights gained to inform business decisions around marketing strategies and product development.
- Plan actions based on the profile segments identified (such as targeted marketing campaigns).
Update and review
Now you have some initial information in place, you can create a plan to regularly update it with fresh data. This will help you monitor the effectiveness of your strategies and update them accordingly.
Other considerations
A couple of other things you should consider with this type of work:
- Employing the use of software to manage large datasets can be a game-changer, but only if you have the technical capability and experience to manage it. You can get lost in tech and focus too much on getting your system set up rather than looking at the actual data if not careful. I would strongly advise you to start small and grow your methods organically.
- Ensuring data privacy compliance is a must. If you’re collecting personal data, you must follow GDPR guidelines. Lots of tools available now base their results on anonymous data which will help you move forward more quickly without having to worry about the legalities of collecting and storing personal data.
Final thoughts
Understanding your demographic audience profile won’t improve sales on its own. It’s nothing if you don’t follow through with actions based on its learnings. What this exercise will do is give you a much more in-depth understanding of your target customers and the nuances that may help them lean towards buying your products, over another brand.
We live in an age where people's habits are more understandable than ever before. The tools available to leverage data from social media and online browsing are becoming ever more sophisticated. This type of learning will likely become automated in years to come. For now, those wanting to analyse these types of datasets have to put a little effort in, but its very accessible. If you’re prepared to do that work, you can gain a real advantage over your competitors.
More articles in this series
- Manufacturers should consider what problems their products solve
- Understanding what your website users really want
- How to speak with your customers - a guide to conducting user interviews
- Beating AI through SEO & Content Marketing
