Definition of Demographic Targeting:
Demographics can be defined as the parameters which are used in segmenting the targeted audience into more specific groups. Some commonly used demographics include gender, age, location, languages known, annual income, parental status etc. Depending on these traits the audience is segmented into more specific groups which automatically makes a precise and accurate targeting
The use of demographic targeting can help the advertiser to target the right audience reducing the unnecessary impressions thus indirectly saving budget. The targeting is no more a tough zone as almost all the ad server provides such facility of doing demographic targeting. Knowing the business has no relation to kids it is always better to exclude users below 18 years old similarly if the product is related to a female it is better to exclude the male audience, etc.
The demographic variables are the most commonly used segmentation bases for the distinction of groups of customers and consumers. They are also the easiest to evaluate and helps in targeting accurate users.
Demographic segmentation is so important that even when the market is not described in terms of population, it is necessary to relate the demographic characteristics so that one can estimate the size of the target market and the means of communication should be used to achieve it more efficiently.
Needs, desires, demands and consumption habits of customers are often related to these variables. Thus, the market is divided into groups of basic demographic variables such as social class, gender, age, family size, income generation.
Role of these demographics in Advertising World:
Advertisers use demographic traits like gender, age, location, languages known, annual income to group the audience in more specified groups. All members in the groups share the common trait. So, when the advertiser wants to run a campaign aimed at a specific group of people then that campaign is only served to the group that contains those traits at which the campaign is targeted.
Demographic segmentation enables advertisers to identify the potential audience for ads and product which are meant for a specific group of a population with common traits.
Advertisers are able to identify when and where the ad should be positioned so as to achieve maximum profits. Advertisers generally combine no. of parameters to define the demographic profile.
Difference between Target Market and Demographic Targeting:
Although both the target market and demographic targeting belong to a broader marketing segmentation process known as S-T-P marketing i.e. Segmentation, Targeting and Positioning. But there is a slight difference between what these two are aimed at.
Target Market aims at advertisers identifying the potential market which could guarantee them better results and maximum profits. Few of the parameters which are taken into account while looking for the potential market are Market size, growth potential, number of competitors and company strengths.
Demographic targeting aims at segmenting the audience based on the shared traits and then targeting them with the campaign meant for them. Demographics segmentation works best when a product has customers with clearly definable personal traits.
For eg: Suppose a company has a product which is best for males aged between 18-25 yrs and has an annual income of $5,00,000 per year. So, the company would create a demographic group based on three parameters.
Based on age.
Based on gender
Based on annual income
Among the demographic variables used for segmentation include (Detailed):
- Age and Life Cycle
The needs and choices in time consuming, vary with age and stage of life of consumers.
This distinction can be made by dividing the market:
- Age groups:
Majorly used demo targeting is age group as maximum advertiser targets the user as per their age, if the product is not related to a child it is always excluded so that there is not unnecessary impression and budget burn. Similarly, they customize the targeting as per their target users. The general category underage is made as below:
- Below 6 years;
- 6 to 11 years;
- 12 to 19 years;
- 20 to 34 years;
- 35 to 49 years;
- 50 to 64 years and
- Over 65 years.
- Lifecycle Phases:
As an example of the segmentation stage in the life cycle, the market could be divided between:
- Children, youth, adults, and seniors;
- Singles and married;
- With or without children;
- By the age of the children still living in the parental home;
- For family size or a number of children who still live with their parents.
Expectations and consumer preferences vary according to gender consumers. Companies are increasingly able to recognize these differences and provide options to meet the different requirements arising from this demographic variable. Products and services are designed with differentiated features to please both the male audience as the female audience. Categorization is always as below:
This is one of the variables used, however, the income should not be considered in isolation, as there are other factors that determine the propensity to consume certain products and services. The division of the market held by the income variable usually considered a total income of families with values expressed in dollars and number of minimum wages. Categorization is generally as below:
Less than 9.999
10 thousand to 14,999
From 20,000 to 29,999
From 30,000 to 49,999
From 50,000 to 99,999, and
Over 100 000.
Another category is based on the occupation of the user, at times advertiser expects to target the user based on its occupation, for example, if the advertiser is related to some kitchen stuff the main targeted users they expect is the housewife who uses the internet. Categorization can be as below:
Professionals and technicians
Managers, entrepreneurs, and public officials
- Social class
Social class has a strong influence on consumer behavior. Many companies focus their activities to meet specific social classes. However, it is important to remember that the preferences of social classes can change over time and there are several other important features to consider for market segmentation. Social classes can be distributed as Class A1; Class A2; Class B1; Class B2; Class C1; Class C2; Class D and Class E or generalized form as below:
Low to high
Medium to high
Medium to high
Each generation is influenced by the time it was created. Music, movies, fashion, political movements, events and ideologies of each period, influencing the motivations and habits. A division currently much used distinguishes between the generations:
– Generation of the baby-boomers – born between 1945 and 1964;
– Generation X – born from the early 1960s until the late 1970s, reaching the early 1980s, without exceeding 1984;
– Generation Y – also called Internet generation, born after 1980, according to some authors, also covers some born between the mid-1970s to mid-1990s.
– Generation Z – those born since the mid-1990s until the present day.
Not sure whom to target? Follow the below steps!
Here’s the quick step-by-step list of creating and measuring an effective demographic campaign:
- Run a demographic report to see what demographics are converting for you.
- Create a new placement campaign where all the sites are ones where demographic bids apply (you don’t have to choose every site that allows demographic bidding, however, since its a demographic campaign, the placements you do choose should be part of that list).
- Enable demographic bidding and bid based upon how different groups respond to your ads.
Note: It can be helpful to set low bids and then use the demographic bidding options to raise them considerably. Since the demographic bidding options only allow you to raise bids (you can’t bid less for a demographic), your placement bids should be what you’re willing to pay for anyone, regardless of demographic characteristics to view your ad.
- With placement campaigns, you bid at the placement level, not the keyword level, therefore benchmark each placement campaign for performance for your initial bid, and then the demographic bidding ‘bid booster’ will raise your bids when the correct demographics view your ads.
- Run both placement and demographic reports to see your conversion statistics.
- Change your bids/placements as appropriate.