What is demographic segmentation?

Demographic segmentation divides audiences into groups based on age, gender, income, education, etc. When B2C marketers divide their audience into demographic groups, they can more effectively tailor their messaging and products to their audience’s needs.

For example, demographic segmentation may show that a cosmetic brand’s audience is split between 20-something people and 50-something people—and that these two groups buy different products. Demographic segmentation can lead to separate marketing campaigns that more effectively promote different products to each group.

The benefits of demographic segmentation

While demographic segmentation is a broad representation of a brand’s target audience, it still forms the basis of every buyer persona. When brands start to visualize their audience within demographic parameters, they can expect to see: 

  • More customer knowledge: Demographic segmentation is where customer understanding begins. Factors like age, income, and education are clues that can tell brands where to advertise their products and what their campaigns should look like.  
  • Personalized marketing campaigns: Demographics are the starting point for personalization. With demographic segmentation, marketers can design campaigns that speak to the interests, challenges, and needs of multiple target audiences. This is how brands stay relevant—by developing campaigns that reflect broader demographic trends. 
  • More efficient resource allocation: Demographic segmentation can prevent marketers from advertising on channels that don’t make sense for their audience. While it can sometimes be difficult to make sweeping generalizations about promotion channels (people of all ages are on TikTok, for example), demographic segmentation can at least eliminate channels that obviously aren’t a fit.

Demographic segmentation vs. other types of segmentation

Ever since Amazon set a precedent for personalized online shopping experiences that require a much deeper understanding of your audience to implement, demographic segmentation is no longer enough to fulfill consumer expectations.

Here are some additional segmentation levers to pull on: 

Psychographic segmentation

Psychographic segmentation divides audiences into groups based on interests, beliefs, values, and lifestyles. Unlike demographic segmentation, which reveals tangible, quantitative factors like age and income, psychographic segmentation reveals the intangible, qualitative motivations that influence consumer behavior.

Geographic segmentation

Geographic segmentation divides target audiences into groups based on location. This is especially useful for brands with physical locations that want to target people close to those locations with in-store offers and event invites.

Behavioral segmentation

Behavioral segmentation divides audiences based on how they’ve interacted with a brand online, through a website, emails, SMS messages, social media, etc. This is useful for sending personalized and sometimes automated messages that reflect recent behavior, such as a purchase, a product page visit, or an abandoned cart.

How to implement demographic segmentation

  1. Gather data. Brands collect demographic data through website forms, surveys, quizzes, website analytics, social media analytics, customer relationship management (CRM) systems, market research reports, loyalty programs, and customer reviews. It’s important to gather demographic data from multiple sources, so you can cross-reference the data and feel more confident in its accuracy.
  2. Analyze the data. Start by consolidating and cleaning your data in one place so it’s easy to view. Then, divide your demographic data into as many groups as possible, emphasizing what makes sense for your product category. For example, if you sell luxury items, pay close attention to income bracket data.
  3. Develop your marketing strategy. When you have a solid grasp of your audience demographics, you can start to tailor marketing strategies to them. But before moving forward, it’s important to conduct similar analyses of psychographic data and behavioral data, so you’re getting a full picture of your audience. When you have a comprehensive understanding of your target market, it will be easier to choose promotion channels and develop relevant, personalized marketing messages.

Klaviyo makes it easy for brands to analyze demographic data with centralized customer data and easy-to-read reports. Sign up for Klaviyo and get started today.