Demographic segmentation is OUT as consumers are increasingly moving targets

It’s time to rethink your preconceived ideas about using demographics as segmentation tool of your customers.

Imagine the following: The number of Twitter users is growing fast among those aged 55 to 64. More women play video games than men, and there are more gamers aged over 44 than under 18. In August 2014 , the Mandarin Oriental luxury hotel group launched “Selfie in Paris”: A guided tour of the French capital’s best selfie spots in a private chauffeured car.

The above are three seemingly disparate reflections in the mirrored labyrinth that is the 21st century consumerism. But they are all related to each other by a single, profound shift. That is, the diminishing meaningfulness of the traditional demographic clusters thinking – gender, age, class, location, relationship status and more – that have informed the innovation thinking of marketers for decades. Today, those professionals must come to understand a new world in which traditional demographic segments are losing their meaning and applicability. Welcome to the age of post-demographic consumerism.

Is this the realm of the post-demographic age? A new fluidity means that compelling innovations that once would have remained the preserve of a single demographic now spread to any and many. And a further fragmentation of taste makes it nearly impossible to take even a passable guess at the music a consumer is listing to, the book she or he is reading, what she/he will watch on TV tonight simply via a few demographic data points.

So what is driving this change? Post-demographics is about the convergence of three mega trends that are reshaping consumerism:

  1. Widespread adoption of digital technologies that allows billions around the world to have access to the same information, ideas and culture, and often, consumers in Hanoi, Seattle, Parma and Basel lust after the same smartphone, sneakers and new movie release. Today, I read on a billboard by Swisscom “Read with us today what you will discover as news tomorrow in your newspaper”. No comment!
  2. The ongoing collapse of deference to social norms – now frequently seen in developing economies too – is giving more consumers permission to construct their own identities rather than to follow the rules of what is expected of them according to demographic rules.
  3. An explosion in product and service offering coupled with rising affluence means consumers are more able than ever to manifest their self-constructed identity in their consumption choices.

What are the key lessons derived from all this for anyone who must chart a course through this?

First, disregard old rules about the type of consumer you ought to target and the sort of activity you ought to engage in. The UK auction house Sotheby’s did just that last year when it announced an unlikely partnership with eBay to create a website allowing consumers to live stream and bid on auctions from Sotheby’s New York HQ. Sotheby’s is opening its virtual doors to the online bargain hunters of eBay? This is post-demographics in action. Second, look across industries, age segments, regions and more for compelling new innovations and ask “How will my consumers adopt this?” Tinder for middle-aged people who want to find a new relationship and start all over again? Look at one of the many dating and partner matching websites and you will quickly understand that life is not over at the age of 50 as it used to be, and that nowadays tea dance is certainly not the place you will find them anymore.

Mark Schumacher, BSL Professor

Mark-Schumacher---reduced-and-colored

 

 

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