What is psychographic segmentation?

Psychographic segmentation is the research methodology used for studying consumers and dividing them into groups using psychological characteristics including personality, lifestyle, social status, activities, interests, opinions and attitudes.

Psychographic segmentation’s emphasis on characteristics such as personality and values differs from demographic segmentation, which uses a specific trait (such as gender, age, income, etc.) to categorise potential audiences. 

Market researchers use psychographic characteristics to help develop and position their products and marketing messages for different target groups.

Marketers use both demographics and psychographics in their market research to create their marketing strategy. This information adds detail to buyer personas that guide brand positioning, product development and marketing messaging.

Psychographic marketing enables you to engage with multiple target audiences in the ways that will make the biggest impact for each one. This approach saves time and money on approaches that might fall flat and makes it easier to relate to the groups you care about.

You can use psychographics for market segmentation to understand:

One type of psychographic segmentation involves buyer personas. A buyer persona is a fictional profile of a potential customer that might include their title or role at work, their personal preferences, their challenges or aspects of their lifestyle. 

The buyer persona represents both the facts and reasons for behaviours. Buyer personas are a first step in understanding your potential customer’s journey or the steps they take before, during and after they purchase your product.

You can also use psychographic research to develop different marketing strategies, services, experiences and even product offerings for each of your segments. 

For instance, it is common to offer the same product or service with fewer features to price-conscious customers. Customers who don’t care about price but like more features can buy the same product, with more features, at a higher price.

You might find that some of your customers value convenience while others care about customer support. If you divide these into segments, you can adjust your marketing and services to cater to those motivations.

Surveys are a cost-effective and efficient way to collect psychographic information about your target audience. A variety of questions are used to help understand your ideal customer’s personality, lifestyle, social status, activities, interests, opinions and attitudes.

Open-ended questions use a qualitative approach. “What is your biggest challenge with…” will provide a deeper understanding of the respondent's problems.

Likert scale questions show how much they agree or disagree with a statement, such as “strongly agree” to “strongly disagree”, to let you know how important it is to them.

Semantic differential scale questions ask people to rate a product, brand, company or other attribute, helping you understand their attitude.

For effective market research, you need to understand the five types of psychographic segmentation variables.

Personality. People make buying decisions based on personality all the time. Personality covers a broad spectrum of characteristics, from being open and conscientious to being an extrovert or introvert.

Attitudes. Cultural background, family of origin and other factors will influence a buyer’s attitudes.

Lifestyle. Marketers search for feedback from people to better understand problems they encounter in their life. Athletes, business professionals, students, racing car drivers and football mums all have different lifestyles and unique challenges to solve.

Social Status.  A person's social status, often associated with their income, will influence whether they buy basic items, luxury goods or anything in between. Understanding the social status of your customers will influence your pricing, messaging, distribution channels and marketing mix.

Activities, Interests and Opinions (AIO). What do your customers like to do in their free time? Are they political, a film binge-watcher or a night owl? Their AIO will influence how you position your products and attract their interest.

When combined, these variables create unique psychographic segments that make up specific target audiences. We’ll break down each of these characteristics in the following sections.

There are many ways to describe a personality, but one of the easiest to remember and most commonly used is OCEAN.

OCEAN describes five aspects of a personality. Each aspect has a range from high to low that describes that trait. Psychographic segmentation marketing studies these aspects to understand how they influence a buyer’s behaviour.

Openness. People who are very open to new ideas like to explore and be creative. People who are less open resist change or new ideas and are less imaginative.

Conscientiousness. Also known as mindfulness, people who rank high in this category like to plan ahead and take other people into consideration. People who are less conscientious don’t like structure or schedules and are less considerate of others.

Extroversion. People who are extroverts are outgoing, like to be the centre of attention and enjoy interacting with others. Introverts like solitude, talk less and stay in the background.

Agreeableness. Cooperation and kindness are traits of someone who is highly agreeable. People who are distrustful or have little interest in other people have a low degree of agreeableness. 

Neuroticism/Emotional Stability. This trait refers to how emotionally stable a person is. A person with a high degree of neuroticism will be moody, anxious or irritable. On the other end of the scale is someone who is more stable, relaxed and has less stress.

Marketers use surveys, the OCEAN Five Factor personality test and other methods to understand their target audience’s personality characteristics. 

Companies use consumer personality traits to design product messaging for their target audience.

Even if two people have the same personality, they often have different attitudes towards life. Consumers will behave differently based on their attitudes. Attitudes may include aspects such as optimism or pessimism, or they may be tied to a specific belief or value the people have. 

To assess attitudes, you can include questions about consumers’ beliefs and attitudes or use Likert scale questions to ask people to rate characteristics on a graded scale from “not at all important” to “extremely important”.  

More complex research will reveal deeper subconscious motivations. However, even a single survey administered to your target audience will produce actionable insights that can be quickly implemented.

Lifestyle could include occupations, hobbies or ways of living. Whether it is volunteering at a local church, living in an apartment, working at an office or travelling, these activities show what consumers like to do to enjoy their lives.

Habits are also part of a person’s lifestyle. What they do each day, from waking up at the same time to getting their morning coffee at McDonalds, are habits that create patterns in their lives. These habits help marketers create apparel for early-morning runners or design fast-food menus for busy mums who need a coffee on their way to work. 

Loyalty clubs that offer rewards for frequent purchases are a great way to support a habit that benefits the consumer and the brand.

Once you understand your target audience’s lifestyle, you can better position your products and services to appeal to your ideal customers. 

How do marketers collect information on lifestyle patterns? They conduct surveys to understand consumer habits and activities. Once they find the lifestyle patterns that closely fit their products and services, they can better position their brand and messaging.

Companies can also create a “lifestyle brand”, a product that is an important part of a person’s daily life. Starbucks coffee, Nike running shoes and apparel, and Apple iPhones and Mac computers have become a daily part of people’s lifestyles. 

People like to identify with a group, including their social class. Their income level is a key part of determining their social group. An individual’s social status has a direct impact on their buying behaviour.

Demographics, such as income level, are a common way to classify people into a social class. In the US, for example, the five categories typically used are upper class, upper middle class, middle class, working class or lower income. Each of these US income classes has their own beliefs and behaviours that influence their buying preferences.

Where do people spend their time and money? Their activities will influence what kind of products they buy. 

Sports, hobbies, community events, entertainment and other categories are just a few of the activities that people pursue. As you find out more about your audience’s activities, you will find out what products and services they need or if there are market gaps where no one currently offers a solution. Interests work the same way.

Netflix is a great example of catering to their audience’s interests. The combination of enjoying a variety of video entertainment in the comfort of your own home has made them a pioneer in the video streaming business.

Surveying your ideal audience about their hobbies provides a deeper understanding of their passions and interests. It can also help you refine your brand messaging.

Your customer’s hobbies may also provide an opportunity. For instance, a growing number of millennials like to brew beer as a hobby. As a result, the home beer brewing industry is expanding at a double-digit rate because they make it easier and more fun to pursue this hobby.

People hold strong opinions about themselves, social and political issues, business, money, education and other topics. 

While you are not in the business of changing opinions, you can use surveys to understand how strongly they feel about a subject. This information will help position your brand and messaging to support their opinions.

Targeting health-conscious individuals, Tropicana orange juice explains that it offers a healthy alternative to fizzy and sugary drinks. 

Tropicana likes to educate consumers about health. Tropicana takes a community approach to health, partnering with blogger “Tropimamma” to offer health advice to a large audience of young mothers. Tropicana actively gets customer feedback from their social media channels and shares health advice.

BMW caters to people at the height of their careers who have upper-class social status and appreciate a quality masterpiece car. High technology and exclusivity appeal to BMW owners.

BMW drivers enjoy an identity of not just driving, but truly experiencing their car. Known the world over for its premium brand, BMW combines status and pleasure to offer buyers the opportunity to own the world's No. 1 premium car.

Harley Davidson appeals to the motorcycle rider who wants a lifestyle brand for the outsider, the rebel. Buyers can customise their bikes and enjoy the technology that comes at a premium price. Harley is growing its market not just in the US, but also expanding to developing nations who like the image and attitude of the rebel.

Their Harley Owners Group (HOG) is a strong collection of people who identify not just with the brand, but also with the lifestyle it offers. With their love of the open road and a “born to ride” attitude, these consumers are passionate about their bikes, typically range in age from 25 to 40 and enjoy an upper-middle income status with disposable income.

While surveys are used to get a quick response from a large population, you sometimes need to dig deeper to understand buyer motivations.

Customer interviews help you find out the motivations, problems and reasons why people buy. Whether they are one-on-one interviews or focus groups, they will provide detailed information on buyer behaviour. 

Panel surveys conducted over time, such as ApartmentList's monthly surveys, will provide additional information on customer motivations.

In addition to structured questions, open-ended questions are also used for customer interviews. Marketers want to get to the root cause of a customer’s problem to find the reason why they first looked for a product to solve their problem. Understanding the customer’s problem, and whether other people also have that problem, will lead to improved market segmentation.

Once you have collected survey and interview data, you will have great information on who your customer is and why they buy.

The next step is to work with your teams to identify which customer insights match your product and services. Use your insights to update your buyer personas, product roadmap, brand positioning and marketing materials. You may even find an opportunity to test new concepts for products and services. 

Psychographics offer great insights that add to your brand positioning and marketing messaging. SurveyMonkey offers a breadth of market research solutions to ensure that your products, packaging, logo and website attract your ideal audience.