What do the corporate giants know about how to market their businesses that you don’t? It’s something really juicy that has the power to send your sales skyrocketing: psychographic profiling. Don’t let the name scare you off.
Psychographic profiling is a fancy term used to describe learning more information about your customers. You can use that information to get more customers just like them and to market better to your existing patrons.
We’ve all heard of the importance of demographic information, right? Knowing basic demographic information about your customers — such as their age, gender, income level, education and other details — can help you better understand your customers. Having a more in-depth understanding of your customers helps you create more targeted marketing campaigns that yield a higher ROI.
For example, if you know 80 percent of your best customers are female, you wouldn’t spend valuable advertising dollars running an ad in a men’s magazine, would you? That would be a poor use of precious resources.
Now, imagine taking this concept to a whole new level. What if you could obtain information about your top-level customers that went beyond demographics, such as lifestyle characteristics (also known as psychographics), data such as hobbies and interests, to answer questions you’ve always wanted to know for your marketing decisions.
Do my customers ski? Do they drink wine? Do they travel to Vegas? The possibilities are endless for the information you can gather and the ways to use it. Getting this information is easier and less expensive than you might think.
Most business executives and marketing experts think surveys are the only way to obtain valuable psychographic data about their customers. Surveys are time-consuming, have a low participation rate and are restrictive. Surveys also limit the number of questions you can ask your customers.
Fortunately, surveys aren’t the only way to obtain this valuable information. Psychographic profiling can be done for you — simply turn a database of your top customers over to a company, and it performs the profiling services for you. It can provide you with the information you’ve always hungered to know about your customers in less than a week.
It can provide useful reports that summarize important statistics about your customers. Best of all, the lifestyle metrics can be appended back to each customer record so you can use this information to market to them. They do this by using credit-card transactional data, census data and other sources, such as warranty slip information and media subscription data.
Here are some of the great benefits you get if you decide to leverage the power of psychographic profiling:
• Create more effective events and promotions — Once you know what makes your customers tick, such as their hobbies, interests and lifestyle choices, you can market better to them.
One way to do that is by tailoring your events and promotions to suit the preferences of your most profitable customers. You can customize your promotions, giveaways and events based on your customer’s psychographic interests. For example, if you find out that 70 percent of your best customers are avid snowboarders, you can add an event to your promotional calendar that includes an appearance by a professional snowboarder or a snowboard giveaway.
• Communicate more effectively to your customers — Now that you have a ton of helpful information about your customers, you can use it to make sure your target market reads your advertising. For example, you can change your media mix to include niche media, such as “transworld snowboarding,” that targets this specific group.
Niche-media advertising can be less expensive since the readership is generally less. You’re evoking more emotion from your customers with your ads by using verbiage and graphic design that appeals to people with your target market’s interests. For example, Wahoo’s Fish Tacos uses pictures of snowboarders eating burritos in some of its advertising in Colorado. In California, it has surfers enjoying its product.
• Highly targeted prospecting — Psychographic profiling allows you to get more customers who are exactly like your best ones. Gone are the days when you need to prospect for customers virtually blindfolded, using basic information such as income and ZIP code to try to find them.
Now that you know more about your customers, you can use that information to find more just like them. One casino company discovered that 80 percent of its top-level customers enjoyed boating and four-wheeling. It bought a prospect list and received a 5 percent response rate, which is huge, considering that .05 percent to 1 percent is a standard and respectable response rate.
Sarah Procopio, President of Thrive Marketing Science, a business intelligence and driven marketing firm. Sarah specializes in loyalty program development and turning around flailing companies and marketing programs quickly. She can be reached at sprocopio@thrivemarketingscience.com or 949.230.7873. This article was original published in the Denver Business Journal and can be found at https://www.bizjournals.com/denver/print-edition/2011/12/30/unlock-the-marketing-secret-that.html