The End of Demographics
If you are NOT a male marketing executive over the age of 50 with annual household income of $150k living in or around a major US city, then you will not be interested in this post. You should not bother reading it. Seriously, read no further.
Phew. Now that I’ve weeded out all the demographically irrelevant readers of this post, I can continue…
Let’s pretend for a second you are a marketing executive at a packaged goods company on the verge of launching a new, unique, differentiated laundry detergent. Now let’s pretend I have put together two distinct groups of people to which you could market — but you can only choose one.
- Group A is made up of women, aged 25-45 with an median of 2.1 children and median household incomes above $100k.
- Group B is made up of people who are all passionate about laundering techniques, stain removal, fabric preservation, etc.
Hopefully, anyone reading this post would choose Group B…but I’m not sure this would be the case. Many of you will instinctively select the group which is demographically “well defined.” And part of it is not your fault.
It’s what you’re used to, it’s what you’ve been trained to do and you feel comforted by the numbers — the “hard” data. At this point, many of us don’t think twice about using “demographics” as a beacon in our marketing efforts. It’s second nature.
It’s so well established and accepted that, like buying IBM in the 80’s, no one really gets fired for using demographics as the basis for his/her marketing efforts/spend (even if your efforts produce zero results).
However, as we find ourselves firmly rooted in a post-mass media world, in a world defined by social interactions and amplifications, does a demographic-based approach to marketing doesn’t make sense anymore? Or should it go the way of Don Draper’s wet bar?
Is there another approach that can be more effective – more in line to the way information and messages are retained, digested and spread in this generation (and long into the future)? I wouldn’t be writing this post if I didn’t think so…
Why demographics in the first place?
Demographic-based marketing was really a construct of the mass media era when the only real marketing channels were through mass media outlets (print, radio, TV). The buyers of these mass media ad units eventually became more sophisticated and became less and less interested in the raw reach of their ad buys (number of eyeballs) and more interested in reaching the right people.
Media companies, always interested in creative ways to charge more for their air, began segmenting their audiences in very broad, demographic strokes (gender, race, age, income, etc) in an attempt to give advertisers confidence they were reaching the “right” audience.
The advertisers ate it up. As they should have. This was the key to marketing efficiency. If I’m selling a product for women, I don’t want to spend dollars sending my message to a bunch of men. If I focus those dollars on women, I can get more bang for my buck. Simple.
This demographics-based marketing framework was dependent on some very important assumptions. They went something like (or exactly like) this:
A person’s demographics defined his/her interests and these interests defined his/her purchasing intent.
If you are a white female of a certain age with a certain income, we assume you are interested in certain things, and if you are interested in certain things, then you are more likely to buy the things related to your interests. Easy logic.
The problem with demographic-based marketing
While this assumption chain seems logical, it’s far from air tight. As you move from one assumption to the next, you lose accuracy. By far, the largest leap of faith in this whole chain is the assumption that one’s demographics define one’s interests.
Bundling all white females of a certain age into the same bucket and making assumptions about their interests is hugely inaccurate (and in many ways dangerous). The first problem with demographic-based marketing is that if this first assumption breaks (which it does more than ever now), then the whole thing falls apart.
The second problem with demographic-based marketing is the media business’ dirty little secret. Even today, they really have no idea who is actually watching/reading their stuff.
A media executive recently told me, “everyone wants to know the demographics of our audience because that’s what they’ve sold to the advertisers, but…we really have no idea what our actual viewers look like.”
This huge gap in accurate data on audience demographics has been something the entire marketing and media machine has forever turned a blind eye to. But does any of that matter anymore?
How has the social age changed things?
Looking back on the assumption chain above, common sense tells us that the 2nd assumption – connecting one’s interests to one’s purchasing intentions is much safer and more accurate than the first assumption.
The problem, historically, has been that identifying people’s interests (in any scalable fashion) has been near impossible. So demographics became the de facto method for predicting purchasing intent.
Enter social media.
Now it is possible to identify people’s interests and passions. You can see them. They aren’t shy about them. In fact, in may cases, quite the opposite. They want you to know them!
So, at this point, why would we worry about demographics? Why not skip the first assumption in the chain. Why rely on a predictor of interests when you can uncover them directly?
This brings us to a post-demographic era where the proxy for passions can at last be replaced with actual passions–aka passion-graphics.
While I’m not necessarily arguing we should completely throw away all reference to demographics in marketing, I am arguing that, whenever possible, as our default, we should identify and target people based on their interests…. their passions. Why?
First of all because passions are much more closely related to what matters to you, which in the old marketing construct is purchasing intent.
But maybe more importantly, marketing with a passion-graphic approach does much more than give you a higher sales conversion rate. This is because marketing is no longer singularly focused on getting more people to hear your message and buy your stuff. It’s also about tapping the power of the social web to inspire relevant people to share, adapt, co-create and amplify your messages.
People not only buy things about which they are passionate, they talk about them too! And they share them. And they connect with them. And, through this, many of them actually drive scalable purchasing intent. It happens all day long. Talk about marketing efficiency!
When it comes right down to it, demographic-based marketing is a very generic approach to marketing. And therefore, it will continue to be effective for generic products.
But if you are the type of company that prides itself on building something special, then you should categorically refuse to take a generic approach to your marketing efforts.
If you build your product with passion, then you should market it with passion…to those who share your passion. They are out there—connecting, interacting and organizing around their passions.
Instead of worrying so much about defining your base in broad, demographic strokes, start identifying the passions that drive these folks. Then go find them. Listen to them. Identify those leading the tribe. And join in. Participate and add value.
So, are you a male advertising or marketing executive over the age of 50 with annual household income above $150k living in or around a major US city? Don’t bother answering – I don’t really care.
What I do care about is if you are passionate about the future of marketing and the way in which the social web is rewriting the books.
Because, that’s what really matters. Outside of that, you could be a dog for all I care!