What Is Psychographic Segmentation? Examples and Best Practices

What is psychographic segmentation?

Psychographic segmentation is a type of targeting that allows businesses and marketers to divide customers based on psychological traits that may influence their buying behaviors. Unlike behavioral targeting, which measures different types of brand engagement, it uses psychographic data to determine how different groups of individuals think, allowing businesses to market effectively.

Stepping into your customers’ thoughts can help you learn more about their motivations and how to sell anything to any audience. In addition, any business, regardless of size, can use psychographic segmentation to create more personalized marketing strategies and campaigns. Psychographic examples include grouping customers based on social status, interests, and opinions. For instance, an auto manufacturer might use psychographic segmentation to learn what its customers care about to create products and marketing campaigns geared toward those individuals.

Remember, products and services are created for customers. Knowing a customer’s motivations and expectations can help businesses develop better products and marketing campaigns based on what drives customers to make purchases. In addition, understanding your clients and using psychographic segmentation can help you market to the right individuals with the right offers.

Understanding psychographic segmentation variables

As mentioned, several types of psychographic data variables influence buyer behavior and can be used to create your audience segments. These include the following:

Personality

Customer personality can divide audiences based on similar personality traits, such as creative, friendly, introverted, and extroverted individuals, to help you group your customers based on how their personalities may impact buying decisions. A psychographic segmentation example based on personality would be grouping customers based on creativity. If you run a hobby shop, you might group individuals this way to help you determine who your target market is for specific products.

Lifestyle

How a person lives and their daily habits will also help you predict consumer behavior. For example, if you sell home office furniture and supplies, you can determine what types of products to sell to certain individuals. In this case, you can identify which customers are most active or health-conscious and send them a targeted marketing campaign about standing desks.

Social status

Social class can help determine the types of people who use the products and their preferences. Of course, social status can’t predict everything, but you can assume middle-class and upper-class individuals have different preferences. Upper-class individuals typically shop for higher-end or luxury items. For example, Mercedes-Benz typically markets its new cars to individuals who can afford luxury vehicles, which likely doesn’t include lower or middle-class consumers.

Social class psychographic segmentation can help brands understand how to price their products and market to certain groups of people based on spending power.

Activities, interests, and opinions (AIO)

AIO is a type of psychographic segmentation based on the activities and interests of the target audience–ultimately, the things they care most about. For example, some individuals prefer horror movies to comedies, and some strongly oppose sports. A good example of AIO is grouping individuals based on the activities they enjoy. For example, a shoe company may make shoes for several different types of individuals, ranging from running enthusiasts to basketball players.

Attitudes

Backgrounds influence attitudes and values, and every customer has a different perspective you can use for psychographic segmentation. For example, customers might have different attitudes toward pets, work, industries, and so forth. A good psychographic segmentation example of how attitudes impact buying decisions is someone who loves pets would be more likely to purchase premium pet beds.

Psychographic segmentation examples

We’ve gone over a few psychographic segmentation examples to help you understand the different ways you can segment customers, but here are some more to explain how customers can be grouped for more effective and personalized marketing campaigns:

Personality

A clothing company might use personality to determine how to segment its customers. For example, if they group clients by personality and find that many enjoy being the center of attention, they can build a marketing campaign with products that stand out from the rest.

Lifestyle

A coffee company might segment its customers by lifestyle and daily habits to help marketers understand their audience. For example, they may find a segment of customers who follow an active or health-conscious lifestyle and can promote metabolism-boosting coffee products or energy drinks.

Social status

A luxury vehicle company might realize that some customers aren’t high-earners like they had initially thought. Segmenting the lower earners from other customers, this company could promote their more affordable vehicles to those most likely to purchase them.

Activities, interests, and opinions (AIO)

A car manufacturer can use the AIO of its customers to determine what they’re looking for in their next vehicle. For example, they may find their customers have strong opinions about climate change, leading them to market their electric vehicles (EVs) to customers in that segment.

Attitudes

Remember, attitudes are influenced by how someone was raised. For example, a home decor company might find that it has a customer base of religious individuals. With this information, they can start producing and promoting religious products for interior design.

Pros and cons of psychographic segmentation

Now that you’ve read a few examples of psychographic segmentation, you might wonder how it can help your business. Psychographic segmentation can allow you to learn more about your customers, develop effective products, and create successful marketing strategies.

Benefits of this technique include:

• Create targeted campaigns. With psychographic segmentation, you can group your customers based on any of the above variables to help you create more targeted and personalized campaigns. For example, a snack company might find that people enjoy snacks at parties instead of when they’re alone at home and use that to create marketing campaigns about how their snacks can be shared with others.
• Understand consumers better. The most important benefit of psychographic segmentation is that it can help you understand your customers better. Knowing their motivations for the products they purchase enables you to create better customer personas, build products for the right people, and improve your marketing efforts.
• Improve communication with customers. When you understand your customers better, you can improve communications with them by sending targeted messages that encourage them to take action. For example, if you know you have middle-class customers, you can discuss how your products and services solve their unique problems without breaking the bank.

Cons of psychographic segmentation

There are a few cons to psychographic segmentation. Still, the most significant one is that it can’t tell you everything you need to know about your audience because you have limited information. There are several methods to collect psychographic data, but the easiest one is to use surveys to learn more about them. Unfortunately, you may not get enough responses to tell you about each segment.

In addition, psychographic segmentation can be easily misunderstood because it doesn’t use quantitative data, so marketers may accidentally make incorrect assumptions about customers. Collecting this data is also time-consuming, and most businesses don’t have the resources to do it correctly. Therefore, if you want to use psychographic segmentation, it’s best to combine it with quantitative data to ensure you’re effectively targeting the right customers at the most appropriate times.

Psychographic segmentation best practices

To use psychographic segmentation, you must collect it. Market research is just one way to learn about your customers, but it can be costly and time-consuming. In addition, your website will not automatically collect psychographic data for you, although tools like Google Analytics will help you understand your website visitors’ interests. Best practices for psychographic segmentation in marketing include:

• Conducting surveys. Surveys are the easiest way to collect psychographic segmentation data. Surveys should ask several questions to help customers describe their personalities.
• Interviewing customers. Interviews have more open-ended questions about consumer behaviors and motivations, allowing shoppers to tell you more about themselves. Unfortunately, consumer interviews can be time-consuming, so many businesses don’t do them.
• Involving customer service. Your customer service team can tell you a lot about your clients because they interact with them directly. Involving customer service in the process can ensure they’re asking customers the right questions to collect as much data on them as possible.
• Combining data. Data is essential in marketing; without it, you might accidentally make incorrect assumptions about your audience. Data can confirm and prove your reasons for segmenting customers into certain groups and help you create more effective targeting techniques.

Using psychographic segmentation at your business

Audience segmentation can help you effectively identify and market to your audience. Psychographic segmentation lets you learn the motivations behind your customers’ buying decisions and how their habits, lifestyles, and beliefs impact how they interact with your brand. Using this form of segmentation, you can increase sales by developing products for the right audiences and marketing to the right customers based on the products you already sell.

Use Mailchimp’s audience segmentation tools and your psychographic data to improve email open, engagement, and conversion rates. With Mailchimp, you can create campaigns for each audience segment to ensure tailored messages make it to the right customers.