Both demographics and psychographics play a vital role in marketing to B2B buyers. In the past, demographics was the primary tool for defining characteristics of your target markets and audience. This traditional method of audience targeting creates market segments based on characteristics such as geography, age, gender, marital status. It looks to establish a logical connection between these characteristics and purchase behaviour.
However, marketing messages that seek to drive consumer behaviour must appeal to more than just the logical, analytical aspect of human thinking. They must also resonate with the more fundamental cognitive system, one that is driven by emotion and personality traits, not rational thought.
Psychographics directly challenges the popular misconception that all decisions in the B2B world are entirely logical. Although B2B buyer processes are more complex than in B2C and often involve a committee of decision makers, B2B buyers are still human and should be treated as such. This is where psychographics and psychographic segmentation comes in.
Psychographics is a qualitative approach to analyzing consumer behaviour. It goes beyond classifying individuals based on general demographic data such as age or gender. Rather, it looks to understand the cognitive factors that drive buyer behaviours and provide insights so that prospects and target markets can be connected with on a deeper level. Psychographics focuses on psychological characteristics and personality traits such as:
Collecting and analyzing this data allows marketers to create detailed profiles within audience segments which can be used to craft highly relevant messages for the specific groups within those segments.
This provides considerable value to marketers because while buyers in a segment may be demographically similar, this does not mean that their behaviour will be the same. For example, just because two people are the same age and earn similar incomes does not mean they share personal values or interests that play a critical role in decision making.
Psychographic segmentation takes a more granular approach that affords marketers with greater accuracy. Any insights gathered from market segments feed into psychographically informed campaigns and help to take messaging further than simple demographic data.
Demographics have long been the foundation for data-based strategies and segmentation. Although they can serve as a solid foundation for campaigns, demographics alone are not enough to inform tactics.
The reliability of static demographic data is also its drawback. As variables such as job titles continue to fluctuate and evolve in the B2B space, they require further interpretation than demographics can provide. Psychographics lend perspective into the emotional side of decision making that is not available from examining demographics alone.
The B2B buying process is more personal and emotion-driven than commonly acknowledged. Communicating the value of your offering is certainly critical to your messaging but it is not enough to differentiate your business.
In the past, B2B marketers highlighted the value-driven and rational needs of decision-makers within businesses. These decision-makers are focused on how purchases can benefit their company and the results that their choices will yield.
Consider that the inherent nature of this process involves weighing the risk and reward of every decision. Positive or negative results have the potential to impact a prospect’s credibility and their career depending on the consequences of a decision. These are innately strong emotional triggers that should be leveraged in marketing messaging and interpreted as part of market research.
A recent study from CEB and Google reveals that “personal value has twice the impact of business value across a broad range of commercial outcomes.” B2B buyers are almost 50% more likely to buy a product if it provides personal value such as career advancement or pride in their purchase decision.
The study also found that B2B buyers are eight times more likely to pay a premium for comparable products and services when there is personal value to the purchase, and 50% of buyers claim to have an emotional connection with the B2B company they are buying from.
Because these decisions are based heavily on emotions, B2B companies can benefit from using psychographically informed campaigns to build valuable connections with their target markets. By combining demographics and psychographics, B2B marketers can reach the right client, with the right message, at the right moment.
Although analysis of interaction with marketing campaigns run across multiple channels such as Facebook ads can be insightful, collecting psychographic data requires specific market research.
The most valuable data comes directly from potential clients. Consider running focus groups to screen how prospects will interpret messaging aimed at relating to their personality traits. Interviews are another effective way of collecting information from each market segment.
Asking prospects and existing clients directly about their preferences or what prompted them to make a purchase can be essential for accurate psychographic segmentation. Interview questions can also be adapted into questionnaires and surveys if time is an issue.
However, the best data is recorded through direct interactions with groups in each market segment. All these methods should involve incentivization to drive engagement and aid collection. It is also important to know target markets and determine how much you can be asked of them before beginning to avoid damaging relationships.
Social media is another way of collecting psychographic data via social listening. Aside from analytics, users regularly share their opinions, interests, and pain points in their posts. This data can improve strategies. For example, focusing on the language prospects use to make complaints can help with the creation of marketing messaging that resonates with its target markets.
Buyer personas create a detailed picture of prospects and how best to approach them according to their preferences, needs, and goals. Psychographics make a fine addition to personas by adding extra detail from personality traits and other defining qualities of prospects uncovered in market research.
These may include preferred channels, preferred content, and the best time to program outreach. Psychographic segmentation provides insights that can inform campaigns and avoid wasting time and budget on unsuccessful strategies.
Buyer personas must be regularly updated and should be combined with the data collected from focus groups, interviews, and otherwise. This in tandem with testing ensures their accuracy.
Nurturing relationships with potential buyers is a crucial process that is reliant on a solid understanding of their interest and needs. As each prospect sits in a different stage of the funnel and buyer process, it is important to match their progress with the appropriate outreach and content.
As prospects come to expect greater personalization and attention to detail, nurturing must be accurate. Failing to align nurturing with the needs and readiness to make a purchase of a buyer can result in a damaged relationship. This pressure complicates nurturing.
Psychographically informed nurturing combines data from buyer personas and feedback from others in the same market segment to simplify this process. By taking into consideration psychographics, marketers can better anticipate outside influences on buyer decisions.
The addition of psychographics minimizes the risk of wasting time and resources by losing a connection.
Marketers today have a vast amount of data at their disposal. Businesses are flooded with data from so many different channels that it is impractical for companies to have a dedicated team of analysts to interpret all this information. Instead, they often use marketing automation software to perform market research and gain actionable insights from the data they collect.
Until now, marketing automation platforms have been used to perform repetitive tasks such as scheduling social media posts, sending email newsletters, and automated follow-ups. However, with all the data available today, these technologies will begin to provide a valuable tool for understanding buyers and market segments on a deeper level.
Marketing automation software will use the enormous amount of available data to add to detailed psychographic profiles. Marketers will then be able to use the profiles to refine their audience segments and create messaging that is more relevant to those they are looking to reach. This will result in highly personalized marketing campaigns that are more effective at acquiring new customers.
Businesses that combine the use of psychographics with marketing automation platforms will understand their customers more thoroughly and benefit from data-driven insights. If you want to learn how to gather psychographic data and integrate it into your marketing strategy, be sure to read our “Psychographics for B2B Marketing” whitepaper.