Understanding Psychographics: Using Generational Segmentation in Marketing

Positioning a brand within a specific market and its target segments is one of the most powerful tools marketers can leverage. By using psychographics and particularly generational segmentation, businesses can tailor their strategies to meet the unique needs and preferences of different consumer groups, thereby increasing brand relevance and engagement. This article explores how generational segmentation can be effectively utilized to enhance marketing strategies.

Generational Characteristics and Consumer Preferences

The segmentation of consumers into generational groups, based on their age or generational period, remains a robust method in marketing. Common generational groups include:

Centennials: Individuals aged 12 to 19 years old Millennials: Individuals aged 20 to 34 years old Generation X: Individuals aged 35 to 49 years old Boomers: Beyond: Individuals aged 50 years old and beyond

Each generation has distinct characteristics and preferences, influenced by their historical and cultural contexts. For example, a TGI survey (2020) indicates that Millennial consumers are 21 percentage points more likely than the average to consider themselves “Tech Setters” with an Affinity Index of 121, compared to Boomers, who are -24 percentage points less likely to relate to this label, with an Affinity Index of 76.

Brand Preferences by Generation

Understanding generational preferences can highlight significant differences in brand loyalty and preference. Consider the case of automobile brands Honda and Toyota in the Latin American market. While both are seen as reputable brands, their appeal varies dramatically among different age groups.

Honda, with an Affinity Index of 148, is highly favored by the Millennial cohort, with 48 percentage points more likely than the average to be the preferred car maker for their next auto purchase. Conversely, Toyota, with a similar Affinity Index, is preferred by Generation X, with 46 percentage points more likely to choose it over other options.

These insights demonstrate the power of segmenting target audiences. Differences can be stark even within smaller age brackets, underlining the necessity of a nuanced approach in marketing strategies.

The Importance of Best Practices in Generational Segmentation

Effective generational segmentation leads to several advantages in marketing:

Correct Business Focus: Aligning marketing efforts with the specific needs and preferences of each generational group can maximize sales revenue. Improved Campaign Performance: Tailoring messages to resonate with the values and aspirations of different generations enhances campaign effectiveness. Revealing Expansion Opportunities: Identifying unmet needs in certain segments can open up new markets and opportunities for growth.

By leveraging generational data, marketers can create more personalized and relevant content, leading to higher engagement rates and stronger brand loyalty.

Conclusion: Generational segmentation is a powerful tool in a marketer's arsenal. By understanding the unique characteristics and preferences of different age groups, businesses can tailor their strategies to meet the needs of their target audience, ultimately driving success and growth.

References:

Kantar TGI Latina, 2019 Wave II, 2020 Wave I V.09.11.2020 – Total Sample of 71,433 respondents