Geodemographics

Data Collection

Data necessary for geodemographic analysis will vary depending on the goals of the project but will always consist of two components—the target group and the geographic unit of study. The target group consists of individuals of specific characteristics and is measured through proxy variables. For example, high-income households might be measured with the proxy of how many cars a household possesses. Proxy variables include but are not limited to information concerning socioeconomic status, demographics, durable goods, usage of public assets, and any other information concerning the lifestyles of individuals and families. The scale of the geographic unit of study will also depend on the goals of the project but will almost always follow preexisting administrative boundaries, such as postal codes, census tracts, or census blocks. GIS is used to tie individual data to locations, assist in analysis, and geographically represent the data. General demographic and socioeconomic data are collected from existing public data sources, such as the census and administrative surveys. Marketing firms often need to buy or privately fund syndicated market research group surveys, which contain extensive detail but do not have many respondents.

Classification

The main goal of a geodemographic analysis is to produce a classification scheme of neighborhood profiles. Classification takes all the areas under analysis and groups them into a smaller number of classes ranging from 10 to the 150 types offered by some marketing firms. Over time, classes have been offered at increasingly fine scales, ranging down to the household and, at times, even the individual. The number of classes will depend on the needs of the project and how much detail is wanted. Classification is accomplished by placing all proxy variables of interest into a factor or cluster analysis with a predetermined number of classes. The demographic and socioeconomic characteristics of each class are summarized, and often a short label is assigned to each class that gives an impression of what that class represents. Companies selling geodemographic classifications will also usually provide a picture or drawing representing each class. The classes can then be mapped in a GIS, but care should be taken to produce a meaningful and realistic map structure that is easy for the user to understand.

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