Chapter 4: The Importance of Customer Demographics in Retail
The average American is exposed to thousands of advertisements per day, promoting everything from car insurance to candy. Think of ads you’ve seen recently. Were some of them designed for an audience you don’t relate to? Did others speak to your needs?
All forms of advertising, including retail displays, are designed to target a specific customer base. It’s essential to know who your customers are and what’s important to them to create an effective display. If you know who you’re speaking to first, it’ll be much easier to communicate an idea with your display.
You’ll want to learn as much as possible about your customers, including demographics. Demographic information can help you understand your customers’ wants and needs so you can connect with them through marketing materials. Once you make a connection, they’ll be more likely to buy from you than a competitor. Demographics can be especially helpful if you’re trying to reach customers who aren’t aware of your product or brand.
This chapter explores data collection in marketing and shares ideas for applying this information to display design. If you have any questions on how to maximize your retail display, we’re here for you at Creative Displays Now.
What Are Consumer Demographics?
Demographics are characteristics that describe who your customers are without defining their personalities. Important customer demographics include:
Consumers have different wants and needs at different ages. For example, teenagers likely aren’t as interested in buying health care products as older adults. Similarly, older customers may be more concerned with price, while younger consumers may be more interested in appearance and brand. Know what age group is most likely to buy your products. You can design a display to appeal to your target customers based on their age.
Gender may influence a person’s buying decisions. For example, research has found that emotional factors are more important to women when buying, while functional factors matter more to men. Gender also plays a role in who does the shopping. According to Pew Research Center, women usually buy groceries for a household. Think about your product and how your display can reach target genders as they shop.
Income shows you how much your customers have to spend on the things they want and need. If your customers have limited incomes, your displays and other marketing materials should convey affordability. If your target audience has a higher income level, you might design a display that communicates prestige or quality.
A customer’s education level is linked to their preferences, shopping style and income. In general, more educated shoppers choose their products more carefully. They might spend extra time comparing items to competitors’ products or researching the items online before they make a purchase. You can help educated customers reach a decision in-store by including your product’s unique benefits or features on the display.
Highly educated consumers may also be more likely to purchase organic products, according to a study. If you manufacture organic goods, you might keep this information in mind when designing your display.
Where your customers live influences what they prefer and need. For example, some areas have cultural traditions that impact food preferences. Also, certain regions, like rural areas, don’t have access to a wide range of options, unlike metropolitan areas. This can also impact how consumers perceive products.
Don’t Forget Psychographics
Psychographic information explains why customers buy your products. Unlike demographic data, which provides facts about who your customers are, psychographic information includes:
- Personality traits
Psychographics often influence a consumer’s decision to buy something and is an essential component of defining your target audience.
What Is the Importance of Demographics in Marketing?
Demographics can help you identify and understand your target audience. You can then focus your marketing strategies on consumers who are most likely to buy your products rather than try to reach everyone. It’s a more cost-effective and manageable way to promote your products and reach new customers.
Although demographics aren’t everything you need to know about your customers, this information can help you with the following:
- Create a clear buyer persona: A buyer persona describes your target customer in detail. It’s hard to create a buyer persona if you don’t know your target market’s age, gender, income status and interests. Demographics and psychographics are necessary to painting a clear picture of your target customer and identifying their needs, likes and wants.
- Predict future demand: Marketers often research demographic data to see how well a specific product is selling, who’s buying it and where. For example, if your research shows that craft beer sells better in a particular region, you might focus on promoting your beverage in that area.
- Influence buying behavior: Once you have a detailed image of your target market, you’ll have an easier time designing promotional material to appeal to their needs and influence their purchasing decisions.
How to Research Demographics
You’ll need to do some research to gather demographic data and determine your target audience. Many tools are available online to help you begin your research, like the U.S. Census Bureau’s American FactFinder or data from the Pew Research Center.
You can also conduct research through online surveys and questionnaires. You might add demographic questions to the end of a feedback survey and include the option for customers to skip questions they don’t want to answer.
Other ways to collect demographic data include:
- Look at customers’ online accounts, past transactions and communications.
- Purchase industry-related reports from market research companies.
- Hold a market research focus group.
- Gather data from social media sites.
After you collect more information about your customers, you can create a buyer persona. Your buyer persona will help guide your design decisions.
How to Use Customer Information When Creating a Retail Display
How do demographics and psychographics apply to display design? Here are some ideas to stir your creativity:
- Use bright colors and strong contrasts to appeal to a younger audience.
- Choose a simple and classic design to attract older customers.
- Include information with your display to reach well-educated customers.
- Use your display to promote a sale and appeal to low-income consumers.
- Apply a monochromatic neutral color scheme to draw high-income customers.
- Incorporate a local celebrity, sports team or icon in your design to target local customers.
- Use your display to highlight healthy ingredients and attract health-conscious customers.
Demographic Trends in Retail
Consumer demographics change over time, so you’ll need to keep up to date. Understanding demographic trends is a part of marketing to the right customers. According to Deloitte, here’s how consumers are changing:
- The U.S. consumer base is becoming more diverse.
- Today’s consumers are more educated than they were 20 years ago.
- Consumers are delaying buying homes and getting married.
- Living expenses are increasing and putting more financial pressure on consumers.
If you’re concerned about keeping up with changes, let us know. Our in-house retail experts can design an on-trend display crafted to your customers’ tastes — and get it to the retailer on time. Give us a call at 1-866-244-2214 to get started!