3 Practical Applications of Psychographic Segmentation
In today's digitally-driven economy, it’s a common practice for marketers and advertisers of all kinds to collect data about the consumers and prospects that interact with their brand. Today's well-informed consumer also understands this fact, and as a result, they generally expect a higher level of engagement with the companies whose products or services they purchase.
In order for brands to provide customers with this increased level of responsiveness and personalization, more robust forms of consumer segmentation are required. Although several types of segmentation are in common use today, psychographic segmentation stands out as one of the premier techniques for gaining detailed insight into the needs, values, priorities, and desires of a given target audience.
The reason: Psychographic segmentation focuses more on the motivations behind consumer behavior so that marketers can better understand what drives the decision-making process of their target customers.
So what are some ways in which psychographics are utilized to help brands connect with potential prospects and consumers? Below are 3 examples of psychographic segmentation that demonstrate the various practical applications across popular marketing verticals.
1. Retail Industry
Marketers of retail products such as video game consoles, e-readers, tablet computers, etc., typically attempt to identify their target audience based on key demographic data points such as income, education level, number (and ages) of children in the household, etc.
While this has traditionally been an adequate starting point for most marketing campaigns, it fails to provide brands with any information in terms of why a consumer would want to purchase a given product.
Psychographic segmentation identifies the various psychological differences between purchasers, enabling marketers to create granular consumer profiles that highlight the various priorities and motives behind their buying decisions. For example:
- One household may allow their children to spend more time using electronic devices because they feel that it is important to expose their children to new forms of technology. In psychographics, this type of household might fall under the consumer profile of an “enabler,” because they are encouraging more frequent use of electronics for their children.
- On the other hand, another household might feel it is important to limit screen time for the sake of focusing on family interaction. This household might also feel that technology should primarily be used for educational purposes rather than just purely for entertainment. In psychographic terms, the profile that might be created for this type of consumer would be that of a “limiter.”
While the end result for each consumer profile is basically going to be the same — i.e., they will purchase an electronic device — their psychographic information reveals significantly different motivations for each purchase. Therein lies the power of psychographic segmentation: It allows marketers to fine-tune their messaging in order to appeal to the values and priorities of each distinct subgroup.
2. Travel Industry
"Are you traveling for business or pleasure?" This famous question has been asked by countless customs agents all across the globe, and it is a perfect example of a psychographic inquiry in action. As you well know, there is a world of difference between going on a business trip and taking a vacation, but even within these distinct categories there are multiple shades of variation in terms of why someone would choose to travel.
For example, under the broad banner of “leisure trips,” you might find travelers who are looking for a new adventure versus those who are just trying to get away for some much-needed respite. Using psychographic segmentation, brands can drill down further to identify potential motives for various travel plans, so that they can customize their campaign messages (and travel packages) to match the desires, priorities and preferences of their target audience.
3. Healthcare Industry
The healthcare industry has faced significant challenges in terms of fostering engagement and encouraging healthier lifestyles among patients, and this has primarily been due to a lack of adequate audience profiling and targeting techniques and methodologies.
As Powell and Tapp have pointed out, consumer segmentation based on demographic factors (e.g., age, socioeconomic status, gender, etc.) instead of their psychological and/or behavioral characteristics tends to deliver lackluster results, because it fails to address the many internal factors that can have a pervasive effect on patient behavior.
Using psychographic segmentation, healthcare providers, hospitals, health systems, health insurance carriers and other industry participants can group potential healthcare consumers according to their key beliefs and preferences, such as individuals who:
- rely heavily upon the recommendations and opinions of their healthcare professional;
- tend to prioritize the health and well-being of others over their own;
- are proactive in reference to seeking information and guidance to promote their health and wellness;
- believe in (or reject) the validity of naturopathic or holistic medicine;
- demonstrate a variety of other motivations, beliefs and/or priorities.
With the help of psychographic segmentation, marketers can customize their messaging to better connect with each one of the above consumer profiles, which will in turn boost engagement and promote increased adoption of healthcare-related products and services.
The application of psychographic segmentation also extends beyond marketing to clinical care. Progressive providers have used psychographic segmentation to motivate patients to take the appropriate steps facilitating recovery post-hospital discharge. For example, Massachusetts General Hospital has used psychographic segmentation with automated, digital communications to reduce hospital readmissions following a type of spinal surgery.
As you can see, psychographic segmentation applications in these various industries all have a similar aim: To help marketers and brands better understand the psychological makeup of their target audience. By doing so, businesses can design marketing messages that will better resonate with the people they're trying to reach, producing effective results on both sides of the transaction.