Demographic segmentation may show you broad commonalities among your customers.
But what about their interests, beliefs, and challenges?
By understanding what truly motivates your customers, you’ll create higher-converting marketing and content that truly resonates with them.
In part two of this three-part series, we’ll dive deep into psychographic segmentation. You’ll learn how to access data for consumer insights, and how to use it to 10x your conversion rates.
What is Psychographic Segmentation?
Psychographic segmentation is the sub-categorization of a market defined by characteristics, personality, lifestyle and opinion variables. It helps identify the best customers by how they think, the brands they relate to and their core beliefs.
By better understanding a customer’s psychology, you can provide better service and products that address their needs.
Of course, the needs and desires of a customer change during their lifecycle. As they get older, their relationship and income levels will change. Which, in turn, progresses their psychographic profile.
The interests and beliefs of a 40-year-old male are likely different to those of a 22-year-old female.
But psychographic segmentation goes deeper than these demographics. It helps you to understand the key motivators of your customers. This understanding then allows you to create better marketing.
5 Psychographic Segmentation Variables (And Why They’re Important)
So, what are the variables that make up psychographic segmentation? How can you fully understand what your customers believe and what motivates their buying behavior?
The following variables make up what we know as “psychographic segmentation.” By collecting data and qualitative insights in these areas, you’ll be able to paint a broader, more granular picture of your customer personas.
Interests, hobbies, and opinions
These psychographic variables have a huge impact on buying behavior. These include your customers political and religious stance, views on the environment, sports, arts and critical issues.
The activities your customers engage in and the beliefs they hold determines their behavior. It also affects how they respond to your marketing message.
Here’s a breakdown each sub-segment of this variable:
- Interests: Is your customer interested in cooking, technology or books? If they like to read, are they huge Harry Potter fans, or do they prefer Lord of The Rings? Unless there’s a clear overlap in interests, there’s no point in promoting video game merchandise to a sports enthusiast.
- Activities: A person’s interests ultimately defines their hobbies. Somebody who travels for work, goes to the gym and plays tennis once a week is considered an “active personality.” Thus, they will tend to have active hobbies.
- Opinions: Consumer opinion spreads fast, and matter now more than ever. From political standpoint to religion, the opinions of your customer define the way they respond to your marketing.
From clothing to the food they buy (and cook), lifestyle is an important sub-segment that can help you figure out what stage in life they’re at (i.e., the customer lifecycle).
The consumer who has just graduated college will have different desires to those working in an office. Similarly, the lifestyle of someone living in a rural area won’t match the needs of an urban dweller.
Their upbringing and culture dictate your customer’s values and attitudes. By understanding customer values, you can better understand what they’re thinking.
Someone with a high-income range would value the pleasure of dining out (especially in high-end restaurants) and wearing branded clothes. The commercial banker is financially-savvy, looking to increase the value of his assets and invest in new ones.
Buying power is the most common method of defining social class. Income, region, and spending habits are all factors that influence income.
People with a high social class tend to purchase items to maintain it. That’s why brands like Prada and Louis Vuitton target affluent segments because they are most qualified and motivated to buy from them.
Lifestyle and social class are the two variables that fuel personality traits. Someone with high buying power may have a “powerful” persona, which is where the term “brand personality” comes from.
Different brands target different personalities based on the ecosystem of their psychographics. To do this, you must group customer segments who share similar personalities together.
Are they introverted or extroverted? Emotional or logical in their decision making? Your customer personas must include these personality traits to help you approach customers effectively.
How to Collect Psychographic Insights
You now understand the variable that makes up psychographic segmentation. The next step is to collect consumer data to yield insights.
These approaches and tools cover both quantitative and qualitative data. You’ll collect a breadth of insight while going deep into the true motivations of your customers.
1. Customer interviews
In part one, we talked about the benefits of surveys to yield demographic insights on your audience.
Now it’s time to go deeper, generating qualitative insights by conducting customer interviews.
People open-up to other people. You can dig deep into your customers’ responses when you’re in front of them or on the phone. You’ll learn the true motivations and pains behind their challenges as a result.
With customer interviews, you can figure out how customers use your products, uncover key phrases and words to use in your marketing. You’ll also learn what prevents them from buying from you in the first place.
Back in the day, Febreze sold their product as a solution to bad odors around the home. The problem is, most people are familiar with how their homes smell and didn’t see this as a problem.
Upon speaking to their primary market – homemakers – they found that Febreze was used as part of room-cleaning habits. Not as a way of removing smells.
They repositioned their advertising strategy, and within two months, they doubled their sales.
Here’s a framework to use when conducting customer interviews:
- Who to interview: Get customers and leads involved at all stages of the relationship. Talk to prospects as well as your best customers. Reach out to those who haven’t purchased from you lately. You should begin to see patterns emerge after five interviews per segment, persona or category.
- Keep it open-ended: Don’t follow scripts. Use “probing questions” to dig deeper into responses. This structure will provide you with the greatest amount of customer insights. Be flexible and shake up your questions based on responses.
- Don’t ask leading questions: Avoid questions that imply an answer. For example, “What made you most satisfied with our service?” vs. “How did you feel after doing business with us?” The latter option will provide more honest answers.
- Build rapport: Don’t jump straight into the questions. Start off with light-hearted conversation and make them feel comfortable enough to be as honest as they can. Do some research on your customers in advance. Ask fact-based questions. Most importantly, show a genuine interest in what they have to say.
- Listen: Be attentive to what your customer has to say. Listen to understand, not to wait your turn to respond. Don’t react to what they say or correct them.
Most importantly, always be probing. Find topic “threads” and dig deeper into responses. These threads are where you’ll find the true motivation behind your customer’s needs and challenges.
2. Google Analytics
Users and customers who visit your website have a lot of data behind them. Within this data is a treasure trove of insight on their interests and characteristics.
To access this data, head to Google Analytics (GA) and navigate to Audience > Interests > Overview. You’ll see the following dashboard:
Here’s a breakdown of both Interest categories:
- Affinity Categories: These are broad audience categories that were created for TV advertisers. These are the interests of those higher up the marketing funnel and are therefore best used to inform marketing for awareness.
- In-Market Segments: These are users who are more engaged with products and services within these categories. They’re further along the customer journey, and as a result are researching products and services, or are ready to buy.
For creating demand, focus on affinity categories. Looking to tap into existing demand? Focus on in-market segments.
3. Facebook Insights
Facebook has an almost unreasonable of data on their users. And you can easily match this with your customer data to get a snapshot of their interests.
To do this, you need to create a custom audience in the Facebook Ads Manager. Head to the main menu and under Assets select “Audiences.” On the next page, click the “Create Audience” drop-down and select “Custom Audience.”
This will start the Custom Audience wizard. Select “Customer File” to upload your customer data:
You now have the option to upload customer data in CSV or TXT format or connect with MailChimp to import your email data from there.
Follow Facebook’s guidelines on uploading data. This will help you include the right fields and show you how to format them correctly.
Give your audience a descriptive name and click “Next.” You’ll then be prompted to map customer data to the correct fields. Map the relevant fields and then click “Upload & Create.”
Facebook will mark any fields that do not match those they accept as “Do Not Upload.” Take note that it can take some time for Facebook to collect insights on your customers (up to 72 hours).
Now the magic begins. Head back to the main menu and select “Audience Insights” on the far left. On the left-hand menu, select your new audience from the “+ Custom Audience” drop-down.
Then voila! You have a list of categories and interests shared by your audience:
4. Consumer Data via SpotRight
While data from your owned sources above can be useful, it doesn’t give you a complete overview of your audience.
You’ll gain more accurate insight by tapping into consumer insights from several (or hundreds of) connections between a group of people and the brands and interests they engage with. The breadth of data allows you to be more granular with your targeting. Here’s an example from Millennial Moms of Young Children:
Use the SpotRight platform to profile your customers, build personas and identify the brands, interests, and influencers they engage with the most. Use psychographic facts to create better, more effective marketing for them.
The best part? Once you’ve uncovered the right audience for your campaign, you can use the SpotRight platform to create a lookalike audience and target those people across 150+ digital marketing platforms.
How to Supercharge Conversions with Psychographic Segmentation
With access to psychographic insights on your customers, you’ll understand the motivations behind their consumer behavior.
But how do you use this insight to power your marketing? How do you create high-converting content, creative and copy?
Let’s look at four areas of marketing and growth where psychographic segmentation has the highest impact.
1. Sophisticated Customer Personas
In part one of this series, you learned how to collect demographic data on your audience.
This data provides a good top-level snapshot of your customers. Now it’s time to fill in the gaps.
With psychographic segmentation, you can build more accurate personas that address the needs, interests, and pains of each audience category.
Here are some common elements your customer personas should include:
- Aspirations: What are their goals? Who do they aspire to be?
- Challenges: What do they struggle with? What keeps them up at night?
- Social Networks: Where do they go to share and gain new information?
- Publications: What media outlets do they read? Which email newsletters are they subscribed to?
You should also document the language your customers use. By talking how your customer talks, you’re more likely to appear as a friend. Your customers will believe that you “get” them.
Therefore, customer interviews are important. They’ll tell you what they find most appealing about your offering and why it’s important to them.
If, for example, 8 out of 10 customers use your product for X because of Y, then Y should be prominent in the copy of your landing pages.
It’s okay to swipe your customer’s language word-for-word and use it in your marketing. Use the words they speak and the phrases they use to describe your offering.
2. Hyper-Targeted Ads
Leveraging emotional-triggers is a well-known copywriting technique. By eliciting emotions as quickly as possible, your ads and marketing message will be far more compelling.
What one person finds fascinating, another may find boring (or even offensive). Using psychographic insights, you’ll know which emotional triggers to pull in your marketing.
Use the language and buzzwords you generated from psychographic data and customer interviews. Tap into their aspirations and challenges to trigger one of the emotions in the wheel above.
This insight also means better targeting. Do your customer’s product interests and brand affinities suggest their desires or beliefs? For example, it’s likely that those who shop at Lululemon have an interest in other healthy lifestyle products.
3. Identify Content Topics
Your content marketing strategy needn’t be informed by your product alone. There are other topics, unrelated to your offering, that you can (and should) address.
If you’re selling yoga equipment, you could create content around the following themes:
- Healthy eating
- Workout routines
While they may have nothing to do with what you offer, they’re still of interest to your audience. Include questions that elicit these themes during your customer research. Use affinity categories to uncover quantitative insights.
Here are the common interests shared among Millennial Moms with Young Children:
Analyze the celebrities, influencers, brands and media outlets they follow. Use these insights to inform a broader content strategy.
4. Sophisticated A/B Testing
Applying psychographic insights to your marketing experiments can provide higher conversion rates across your digital assets.
While it’s difficult to collect psychographic data during a visit to your website, you can measure why someone might respond to certain types of marketing.
Did one landing page perform better due to the language used in the headline? Perhaps it was the positioning of the pain or the outcome? The way users react to your marketing will depend on their psychographic profile. Even design can have an impact:
Furthermore, you can use fresh insights to test different elements of your landing page. What happens if you change the headline based on the common challenges of your customers? Use psychographic insights to answer these questions and supercharge your conversions.
When you understand your customers at a deeper level, you’ll be able to attract more of them.
By creating the right content and focusing on their true motivations, you’ll increase conversion rates and make your audience feel like you truly “get” them.
In part three of this customer segmentation series, you’ll learn how to measure your customer’s behavior to turn more leads into sales.