Why the value of demographic data is declining and we should be relying more and more on mindset.
The answer to the above question: We drive the same car.
This idea is far from "fully-baked", but I've been working on it for a couple weeks and wanted to share. Based on some discussion in my office, I got some push back, so I knew then it was at least worth sharing. This is part one and the second part will be acting on this idea. On forward...
So a few Saturdays ago, I am sitting there at the dealership while my Toyota Matrix is getting serviced. I was bored and wanted to ask the sales guys about something that had been bothering me. Why do I keep getting passed by old ladies driving my car? I'm 34, and purposefully bought the "sporty" edition of the car. It's not the dreaded minivan. Roomy enough for kids, a bit to the side of being crunchy, so what gives? They weren't particularly busy, so I start polling some sales folks. Who is buying the Toyota Matrix? What was my mindset that predicted the purchase of the vehicle?
After a few minutes of the sales guy explaining that my mindset and the older generation's align like Romeo and Juliet, I switched to asking about the
Scion. Here's an entire brand focused on the shift to younger demographic. Who is buying the Scion?
If you are not familiar with the Scion story, it's worth checking out. Simply put, Toyota was afraid the flagship Toyota brand was being viewed as your "daddy's Olds". They wanted to capture the fervor of Gen-x and younger by building a car that was essentially Corolla-mechanics in more stylish/trendy body styles with trim levels that could be easily customized to match the identity of the purchaser. There was Toyota reliability and practicality, built on a platform that allowed easy customization. The Scion was born.
Who's purchasing the Scion? Everyone. There isn't a single demographic profile that the Scion fits into. It spans the gamut of the profiles. The salesman I was speaking to, 62 with four grandchildren, owns one. I didn't believe him. He actually took out his keys and walked me to his car. Oops, only the second time I was embarrassed that day. The first one was when the old lady passed me in my car.
Based off the anectdotal data, I was quickly aware that the ages of the buyers skewed a great deal (average age is 39 according to
Wikipedia ). While the Scion owner obviously hit the age of the demographic with success, they also appeal to a much wider audience. I find this particularly interesting. I don't think the purchasing decisions of these individuals just line up succinctly with needs alone. I think that's part of it, but I think it aligns closer to mindset.
Mindset definitionA
mindset, in
decision theory and
general systems theory, refers to a
set of assumptions, methods or notations held by one or more people or groups of people which is so established that it creates a powerful incentive within these people or groups to continue to adopt or accept prior behaviours, choices, or tools. This phenomenon of
cognitive bias is also sometimes described as
mental inertia, "
groupthink", or a "
paradigm", and it is often difficult to counteract its effects upon analysis and decision making processes.
If we begin to accept this idea, how do we begin to reconsider the value of demographic data?
For most of us in the median, demographic specifies many milestones and factoids of our lives. It still does a very good job at this. Specifically, when we get raises, have children get married and so forth. However, traditionally these changes also indicated a belief that our mindset or attitudes were also shifting. I'm contending that less attitudinal changes occur over time in today's society versus decades ago. The fallacy of the demographic most of us imply is that if our age and demographic position changes, that our consideration criteria also change. I excluded pyschographic approaches because at their heart, they represent culture. That level of data isn't as useful when making specific decisions on how to spend dollars. Demographic may explain the position/stage in life changes, but does not address the mindset. I think specifically applies to Gen-X and forward. Simplified:
Utility of demographic data
What utility has demographic data served in the past? A great deal. Targeting a specific demographic forces us to make choices. This is very good step as once we decide to focus efforts on a certain anything, everything about our marketing, product development and so forth begins to improve. However, I would classify the last twenty years as the nicheafication of our society. There are too many niches to plot our culture demographically. Chris Anderson's book, The Long-Tail, talks extensively about the idea how fragmented our society has become. From the endless variety of music, clothes, media and even television stations, demographics become too restrictive to narrow our audience to the right media outlet/solution. Additionally, our traditional traffic drivers whether TV, direct mail, print and so forth has become a big hammer, with varying degrees of success. Hit the nail and hope it drives it in, or in this case works effectively. Mindset on the other hand becomes an interesting tool and addition to hit our audience segments. It actually becomes a very liberating proposition to consider mindset with demographic data.
Take the years before the 1980s, our data sources were limited. We would watch consumer purchase behavior and find out data points about the person. In 1974, we'd hang outside K-Mart and ask consumers why they bought the Nerf brand football. Sooner or later, we could have a fairly accurate profile. More importantly during this time, there were fewer outlets in the purchase cycle. Craftsmen tools were only available at Sears. The amount of stores that carried products were limited. That is no longer the case. Anyone can sell just about anything and now that the petabyte age of data has entered our lexicon, we have to introduce some new ways to dimensionalize demographic data. Dimensionalization occurs with demographics and activation occurs with mindset.
Culture and mindset
Demographics often seek to explain the propensity and ability to be part of a brand consideration. If we are developing mindsets of youth, culturally, our brand choices reflect our youthful position more so than our demographic position. While extreme brands of wealth may fall outside of the bell curve, most consumer purchases fit into the ability for consumers to consider and purchase. It may be the resurgence of qualitative research determining where the mindset is of the consumer.
Forty is the new twenty. Fifty is the new thirty. We no longer grow older (figuratively). We fight mother nature one step at a time. We are encouraged by the old axiom, "you are only as old as you feel." You know what, it's true and we behave like this culturally. This means that our habits, practices and life choices, summed up by mindset, are going to more and more reflect the values that we adopt as younger individuals. If this is the case, our mindset will be less apt to change we progress through the demographic spectrum. Rendering the value of demographic data less and less meaningful to folks as they make choices about their brands.
- Core gamers: 26
- Casual gamers: 36
- Mobile gamers: 31
The suggestion here is less about gaming as a whole, but rather we are encouraged in our culture to continue to pursue our enjoyable pursuits regardless of age. Our adoption of a mindset of youth is more important than our demographic positioning. I had a discussion of this at the office and the idea of stages of life came up. I'm having a baby, my mindset is changing and similar examples. I actually disagree with this statement. Your mindset prior to being pregnant will determine much more of the motherhood purchases than when you become pregnant. Therefore, I think smart companies are going to work harder to determine their targets at earlier stages in life (really part 2 of this piece).
Years 7-14 are now the new twenty something. It actually pains me to type this, but the the new opportunity to introduce existing brands is narrowing. Introducing NEW brands is another situation (in part 2 of this post). My oldest son, Sean who is almost seven, is now beginning to develop the idea about brands. He doesn't actually know this, but we were in the grocery store and he said "mom, get the Campbell's. It has 20% less sodium. It's good for you." The message here is that marketing efforts are impacting children and this dictates a ton of things as parents, but his mindset growing up and (if I have anything to do with it) will be healthful. He is developing this idea and impression now. A typical fourteen year old at this point is much to shrewd today to be given into typical marketing messages. It better be relevant, meaningful and serve their purpose--mindset.
The challenge twists somewhat to determine what mindset is our audience in and how do I present information in a more meaningful way that might be outside of traditional brand benefits. If you consider your audience's mindset, it opens the door to all types of media, both traditional and non-traditional. More importantly, it seeks to build a deeper connection.
We start developing our ideas and brand impressions very early on in life. If we do not have a brand impression, we look for reviews and ratings online prior to purchase. Earlier in this piece I mention the Nerf brand. Nerf was the premium non-leather brand of football. They were more dense and therefore flew further when thrown than non-branded counterparts. They were a premium product. When we recently purchased Sean his Nintendo DS, I saw that Nerf provided protective covers. I immediately purchased one. I have a great brand impression of their products. As much as I hate to admit this, my brand impression of Nerf was created when I was a child and it lives with me today.
Part Two: Acting on Mindset--two weeks at least.I openly acknowledge this blog post is way too long. Doesn't prompt action, at least in part 1, and is somewhat still partially baked. However, when I pose the question to people, it generates much conversation--there are two reactions, everyone believes that demographics are becoming less useful, but lack a better answer. I'm not making promises here, but I'll make suggestions... Here are some folks that put some things out there that really contributed to this idea, or at least my thoughts of it.
- Dave Knox, a P&G Brand manager has a brilliant Slideshare piece on Gen-Y that sparked an idea.
- Chris Anderson wrote a piece on the End of Theory in Wired.
- Malcolm Gladwell's piece in the New Yorker, Most Likely to Succeed.
- Jason Bender, co-blogger, sparked some great fodder in discussion about this topic.
