Demographics

Demographics are characteristics of human populations. Statistics on demographics as they pertain to consumer markets are important factors to be considered when attempting to understand consumer behavior. Groupings such as age, gender, ethnicity, income, mobility, education, and social class are considered to be predictors of consumer behavior and patterns. When market researchers conduct demographic analysis to identify purchase [Page 96]patterns or habits particular to specific consumer demographic segments, the output can aid businesses in matching individual consumer needs with products and services.

Consumer demographic analysis employed as a research instrument is part of a portfolio of tools used in marketing to improve understanding about consumer attitudes, characteristics, consumption tendencies, and lifestyle activities. The gathering of demographic data can occur through a variety of methods from online surveys to point-of-purchase tracking. In recent years, technology has enabled an extraordinary increase in the sheer volume of consumer demographic information available to market researchers. Parsing the data into statistically valid groups or segments based on relevant demographic criteria provides useful input into the marketing processes of a firm. For example, consumer demographic data can improve returns on investment in new product research and development, aid in the selection of the optimal advertising mediums to reach targeted consumers, and help set appropriate product/service pricing to incent consumer purchases from select outlets.

Consumer demographics can also help identify entirely new market segments resulting from changes in society, such as those consumers who are motivated to protect the environment. With concern growing about the deterioration of our natural resources in recent years, there has been a general trend indicating that certain consumers want products and services that can be considered environmentally friendly. This “eco-consciousness” among select consumers is important for businesses to understand, particularly as an input into their product development and marketing processes.

Translating a general market trend, such as protecting the environment, into specific buying patterns has to do with the nature of consumer demographics themselves. In general, consumer demographics are characterized as either antecedent or nonantecedent. Antecedent demographics, such as gender and nationality, refer to sociodevelopmental processes occurring early in life that affect a person's cognitive and emotional reaction to choices of consumption. Nonantecedent demographics are those that occur later in the life cycle, such as income level and education.

Researchers generally consider consumers' values as an antecedent demographic, as they represent enduring beliefs that a particular behavior is good. Valuing the environment is a prerequisite for behaving in environmentally friendly ways, such as purchasing green products. However, studies have shown that concern for the environment does not always translate into proenvironmental behavior. That is, a person who values protecting the environment might not actually purchase green products or even recycle. This value–action gap suggests there are a variety of conflicting factors that can affect a consumer's decisions. Nonantecedent consumer demographics such as income and education play a role. For example, a consumer might not be able to pay a premium to purchase a green product that has a higher price resulting from added supply chain and manufacturing costs. Consumers with little formal education on the sometimes nuanced cause and effect relationship between consumption and environmental deterioration might not feel compelled to bother recycling, particularly if there is an absence of peer group pressure.

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