Brand Quarterly calls demographic-driven marketing "’spray and pray’ tactics aimed at winning a war for attention". MediaWeek says it results in "work informed by unhelpful and inaccurate characteristics". They’re not alone: a chorus of marketers is ringing the death knell for demographic data, but is this time-honored segmentation and targeting approach really obsolete?
What’s wrong with demographic data?
Criticisms of the demographic-driven approach tend to center on two flaws:
The broad nature of demographic data, which connects large groups under banners more concerned with who they supposedly are than what they do.
The potentially over-simplistic insights that demographic data provides, sometimes resulting in messages that appeal to the largest common denominator, failing to reflect nuances like geographical variation and contextual factors.
In the age of big data, the argument goes, we can gather granular information that tells us about individuals’ changing habits, interests and intentions. This enables us to deliver the right information at the right time, rather than pumping out a simplistic, generic message designed to appeal to a broad segment of society.
Can we really dispense with demographics?
The counter-argument is that it’s not demographic data per se that is intrinsically flawed, it’s the way marketers have used it. As News UK CMO Chris Duncan tells Marketing Week: "I don’t think I would want to sell stairlifts without some kind of demographic cut. There are logical markets where age and income, for example, are key."
What’s more, demographics still underpin more traditional forms of advertising, where it is less feasible to employ behavioral insights or a programmatic approach to buying. Digital now accounts for 50% of advertising spend in the UK, but that still leaves 24% for TV, 16% for print, 6% for outdoor and 3% for radio, much of which relies on demographic targeting – at least for now.
Taking a balanced approach
Although it's clear that demographic data, taken in isolation, is an insufficient way of identifying and targeting customers, there is still a case for using demographics as a basic 'broad stroke' foundation for targeting – particularly when a product or service is clearly only relevant to a particular age group or gender.
However, it's necessary for marketers to drill deeper into the data to take into account shifting environmental and social factors that may shape consumer intent, desire and behavior. For example, discount retailers in the UK have traditionally targeted lower-earning segments. However, the economic crisis has seen a huge shift in consumer attitudes, and research found that affluent AB groups now represent 31% of Aldi and Lidl shoppers, while the lower-earning DE group now accounts for just 27% of its customers.
This is just one instance in which a more sophisticated understanding of contextual factors (and how they influence behavior) has proven lucrative for businesses. Taking this into consideration, it's evident that brands need to consider multiple types and sources of data to build a truly representative and detailed picture of their audience(s). censhare is helping businesses to manage myriad data streams, condensing into one accessible dashboard to draw out valuable real-time insights – explore our Advanced Analytics and Targeting solutions to find out more.