The Psychology of Consumer Profiling in a Digital Age

Barrie Gunter

• Publisher: Routledge
• Year: 2016
• ISBN:
  9781317340096
• Edition: 1
• Topic: Negocios y empresa
• Subtopic: Negocios en general

Understanding how consumers choose between different products and services is a crucial part of professional marketing. Targeting brands at the consumers most likely to be interested in them is another critical aspect of business success. Marketers need to know what consumers think about brands, why they like them and what purposes they serve. This means delving into the psychology of the consumer to find ways of differentiating between consumers and matching brands to consumer niches at the level of consumers' relationships with brands. Using psychology to segment consumers has been regarded as a valuable adjunct to standard geo-demographic definitions of market segments.

The Psychology and Consumer Profiling in a Digital Age examines how this field of 'psychographics' has evolved, the different approaches to psychological segmentation of consumers, the different ways in which it has been applied in consumer marketing settings, and whether psychographics works. It draws upon research from around the world and incorporates its analysis of the use of psychographics with an examination of major shifts in marketing in a digital and global era.

1 Types of Consumer Segmentation

The world of consumers and consumerism is a complex and multifaceted place. No two consumers are exactly the same, but some groups of consumers may share characteristics, needs, and interests which in turn influence their commodity tastes and brand choices. Consumers can be distinguished by their biological characteristics, their age, their ethnicity, their family background, the location and type of neighbourhood in which they live, their education, and their economic circumstances. Each of these distinguishing features can be linked to activity preferences and patterns of behaviour that people display, but they do not represent causal agents. Men and women might differ in their commodity needs because of their gender, but it tends to be socially conditioned roles in each case that tend to trigger these differences. This means that even though these characteristics can be used by marketing professionals to differentiate between consumers, to understand fully how they interplay with different patterns of consumer behaviour, we also need to understand the psychology of consumers themselves to explain thought processes that underpin decision-making about which products and services to buy and use.

In this vein, therefore, consumers can be differentiated in terms of their psychological makeup which can underpin and explain the consumer behaviour patterns they display, their motives for doing certain things and making certain choices, and the way they process information about the world around them. In this context, individuals can be differentiated and classified in terms of their ‘personalities’. Human personality is defined by a range of factors that are determined by a combination of inherited biological attributes and environmental experiences and represent enduring aspects of a person that can determine how he or she will behave across a wide range of social settings.

All these different physical, social, and psychological characteristics have been used by professional marketers to define and distinguish between consumers and to understand the product and service choices they make. While demographic features can differentiate between patterns of consumer behaviour, they do not offer explanations for those behaviours. This chapter will provide an overview of the different types of consumer segmentation that draw upon different geographic, demographic, psychographic, and purchase attributes. In relation to consumer profiling based on psychological methods, there are two broad types that can be distinguished: first, those consumer classifications based on personality psychology and second, those based on custom-built consumer psychographic types.

Emergence of Market Segmentation

In contemporary marketing parlance, market segmentation features prominently. Modern marketing professionals are schooled in the idea that while there are ‘mass’ markets for some commodities, more often in competitive marketplaces, specific markets emerge not simply just for types of commodities, but more especially for ‘variants’ of the same types of products or services. These ‘variants’ tend to be identified by their brand names and images. Thus, although the concept of market segmentation has been in use for many generations, it has acquired greater significance as marketplaces have become increasingly crowded with large numbers of brands fighting for market ascendancy.

People have bought and sold commodities for millennia. Prior to the 19th century, however, most produce was made and sold locally. In most instances, people bought necessities such as food, clothing, household items, and treats or luxuries from single sources of supply that each specialised in selling a specific type of merchandise. There were exceptions, such as imported fabrics, valuable minerals fashioned into jewellery, beverages (such as tea), and indulgences (such as tobacco) being transported from afar, but these were generally only available to an elite few who could afford them. Most people, however, were either self-sufficient or relied upon their local suppliers for their day-to-day commodities.

With developments in systems of transportation and communication beginning in the 18th century and continuing apace into the next century, and with technology developments that created industrial infrastructures for mass production, a new world opened up in which non-local commodities could be more readily and speedily transported over greater distances, and the scale of production meant that costs to purchasers fell. Communications systems, such as the first large distribution media in the form of early newspapers and magazines, meant that commodities could also be promoted more widely.

The technological and economic changes that occurred with the Industrial Revolution in the 19th century and which then continued into the 20th century had important impacts upon the way societies were structured. Not only did the dominance of local production for local markets fall away in the face of competition from remote mass producers, but changes to the employment structures resulted in the migration of workers, the urbanisation of societies, and changes to the nature of communities (Kammen, 1991). Social roles also altered. While men remained dominant in the workplace, new employment opportunities opened up for women, generating new forms of differentiation between gender roles. Women’s roles were in some cases defined by employment, but in many more cases revolved around their domestic support functions in the home (Roberts, 1998). Whereas in rural communities, women might have helped with manual work, in the new urban communities, they more often stayed at home to nest build and take on primary responsibility for the management of domestic affairs (Demos, 1986; Mintz & Kellogg, 1988).

In addition, the emergence of diverse product markets resulted in new types of ‘community’ being created linked to brand choices. These ‘consumption communities’ were defined in terms of the commodities they bought that in turn signalled their social standing (Boorstin, 1974). The arrival of ‘mass’ media provided opportunities for competing manufacturers of branded variants in the same product fields to self-promote and differentiate themselves from their rivals. As these promotions grew increasingly sophisticated, they presented more than basic information about the product being promoted. They began to associate a ‘branded’ version of a product range with specific advantages to users that went beyond the core functionalities of the product. Brands were associated with certain styles of living and with social status (Plummer, 1974).

Local producers began to experience competition from non-local rivals and citizens as ‘consumers’ of commodities for the first time were presented with product choices. This was an era in which ‘mass’ production emerged. To assist consumers in making choices, ‘mass’ marketing practices were developed that were designed to provide people with information about variants of the same product type to assist them in making up their minds about which ones to purchase and use. During the early days of mass marketing, mass producers still specialised in the production of a single commodity, and they became known for it. Other mass producers might produce their own versions of that commodity type, and created the first competitive markets. In time, mass producers came to extend their product ranges and marketed a range of products under their generic corporate brand (McKendrick, Brewer & Plumb, 1982).

Such product extensions confronted people as consumers with additional choices whereby they were required not only to decide between the same type of product made by two or more manufacturers, but also between different variants of the same product from the same supplier. To help consumers with fresh challenge, a new form of marketing practice emerged—in the shape of product-differentiated marketing—which helped people differentiate between brands in more subtle ways than simply the name of the original manufacturer. In this context, early ideas about brand image appeared, with manufacturers and marketers identifying differences between product variants based on physical attributes, variances in functionality, and definitions of quality (McKendrick et al., 1982).

Following the differentiation of consumers according to the attributes of the product variants they used, marketing practices moved forward by differentiating consumers by their own characteristics and qualities. Thus, consumers came to be divided up into groups and sub-groups defined by their physical attributes and psychological qualities. This approach enabled marketers to identify the specific tastes and expectations, needs, and interests of consumers and how their psychological characteristics might position some consumers to be more available than average to purchase and use specific commodities or branded variants of product/service ranges. This approach came to be known as ‘target marketing’ (Gunter & Furnham, 1992).

Across the 20th century, products and services multiplied in type and in respect of the numbers of distinct choices offered to consumers. During the second half of that century, as the big developed economies and many developing economies grew, people in general acquired more wealth and a greater ability to consume. In many everyday consumer goods markets, brand choices evolved as more manufacturers and suppliers produced a greater range and variety of variants of products and services (O’Guinn, Allen & Semenik, 2009).

Consumers adopted the concept of ‘shopping around’ to find the best deal for them. The role of branding in defining and differentiating product and service variants grew in its significance to consumers. Consumers, in consequence, gradually became more ‘brand conscious’. Many products and services were evaluated more extensively before choices were made, and these choices were driven by a range of factors. Those factors included actual price (and perceived value for money) and premium values as defined by brand image. Brand image in turn was determined in part by the actions of manufacturers/suppliers in partnership with their marketers in developing product variants with specific distinguishing qualities. Brand reputations also depended upon the judgements of consumers, which were increasingly shared with other consumers (O’Guinn et al., 2009).

If a new product came on the market, it would have to define itself not only in terms of the functional applications consumers usually associated with its type, but also according to its specific qualities that set it apart from other variants in the same product class. This was true whether the product in question comprised a relatively cheap, fast-moving consumer product, such as soap powder, or a more expensive, luxury item, such as a car. A new soap powder might lay claim to being more powerful as a cleaning agent than its competitors, therefore needing less of it to be used per wash, resulting in it being cheaper because each pack would last longer. A new model car might lay claim to being more economical in its use of petrol than its competitors. Or it might be more expensive to run, but sold on the basis that it has a more advanced design and therefore would convey greater social status. Hence, brand appeals for luxury items such as cars often moved from being reliant on functional claims to making references to the social status attributes a brand could convey about its user. In that sense, the market differentiation could centre on the nature of the product or the nature of the consumer.

Finding the Right Target Market

Target marketing defines much consumer marketing in modern, crowded, and competitive markets. The complexity of modern consumer markets means that it is essential for brand marketers to be clear about which consumers they most wish to reach. Even in the mass market era of the 20th century, when there were limited media platforms for advertisers to choose from, the concept of the segmentation of consumers into distinct groups was already established. Then, segmentation was largely defined by geographical and demographic classifiers of populations, although from the middle of that century, initial inroads were made with psychological classifiers, which focused on consumers’ motivations to purchase specific products or services (Gunter & Furnham, 1992).

In this context, marketers identify which consumers are most likely to be interested in a specific type of product or service. The branded variant of the product/service type being promoted is further defined in terms of the type of image it might convey to consumers in terms of how it differs from competing brands in the same product/service range. The ‘brand image’ confirms the point of origin of the brand, which is generally defined by the name of the manufacturer or supplier and also by the location from which it (or the manufacturer/supplier) originates.

In ever more crowded marketplaces, however, the brand image also needs to convey a message to consumers about the type of person that might use it and what their association with the brand might say about them. In other words, there is a sense of consumer identity acknowledged by the brand that reflects the needs, aspirations, and character of people likely to make up most of its customer base. The latter awareness is usually obtained through market research.

Thus, in developing a target marketing strategy, the marketer must begin with a generic consumer segmentation map usually defined by standard geographic, demographic, economic, social, and cultural classifiers. Through relevant and appropriate market research, the marketer should then seek to narrow down whether the people most likely to be consumers of a specific product type are defined by a particular geo-demographic/economic/social/cultural profile. Going further, can these generic classifiers be used to narrow still further the most likely purchasers and users of a specific brand? If, at the brand market segmentation stage, the generic population classifiers emerge as blunt instruments that lack the sensitivity to pin down the most probable market for a brand, further research might be necessary to determine whether product or brand-specific classifiers of consumers are needed that focus more on the psychological drives that need to be articulated to identify who the most likely consumers could be.

A marketing strategy thus proceeds through these stages of: (1) Identifying the generic population segments, (2) Determining which specific generic segments can be used to narrow the focus for brand promotion, and then (3) Finally, deciding how the brand itself can be positioned within potential consumer markets to have relevant and sufficient appeal to potential customers (Gunter & Furnham, 1992).

This process is important because it helps marketers make further decisions about how to communicate promotional messages about a brand to consumers as well as determining what kinds of messages about a brand are likely to work best with the target market. A marketing campaign must be defined in terms of the promotional devices it will use. Most marketing campaigns will use various forms of advertising as their central features. The nature of the consumer target group will also help marketers decide which media to use as promotional platforms. Thus, should advertisements be rolled out on television, or radio, or in print media, or on outdoor media, at the cinema, or increasingly these days, on a digital platform available through the Internet?

Decisions about the media planning of a marketing campaign need to draw upon what is known about which media outlets the target consumers are most likely to use. Thus, if a brand’s target consumers are known to watch a lot of peak-time commercial television, a televised advertising campaign could make a good promotional fit. If they are known also to be regular readers of specific magazines, those publications would likewise be chosen as advertising vehicles. Hence, consumer segmentation information is important to marketing professionals not simply in relation to a brand or to the product range of which it is a part, but also in connection with the media consumption habits of the target consumers they are trying to reach.

Such multilayered segmentation of consumer markets has grown still further in its complexity in the digital era, in which additional promotional platforms have been added to the old media (e.g., broadcast, print, cinema, and outdoor) mix. Moreover, the new digital platforms operating over the Internet offer marketers new formats for advertising that do not appear outwardly as advertisements. Instead, promotional brand messages are integrated with other (mainly entertainment-oriented) content in online settings, and can often become virtually indistinguishable from non-marketing content (Gunter, 2015). This phenomenon raises many other issues about the practice and regulation of marketing methods, which represent a whole other area of concern and we will not dwell upon them here (see Nairn & Hang, 2012; Brodmerkel & Carah, 2013).

Types of Market Segmentation

It will be helpful at this point to outline the main market segmentation bases that have traditionally been adopted by marketing professionals. The main theme of this book is an analysis and review of the evidence concerning the use of psychological bases of consumer classification. These segmentation approaches, however, represent one type amongst a suite of variables marketers have adopted. These segmentation devices can be presented as a single classification matrix, but they also have a hierarchical aspect (See Figure 1.1).

Figure 1.1 Types of Consumer Market Segmentation

One class of segmentation approaches utilises the physical attributes of consumer populations that have not been established exclusively for marketing purposes, but nonetheless have proved to have relevance for defining market segments in consumer contexts. Another class of approaches is more closely tied to marketing objectives and depends upon the measurement of consumer behaviours and the psychological variables that underpin those behaviours.

Physical Attribute Segmentation utilises generic population classifiers. Geographic s...

Table of contents

• Cover
• Title
• Copyright
• Contents
• 1 Types of Consumer Segmentation
• 2 Personality Psychology and Consumer Segmentation
• 3 Custom-Built Normative Psychographic Consumer Typologies
• 4 The Search for Psychology-Based Predictors of Purchase Preferences
• 5 Psychological Profiles Within Demographics
• 6 Global Consumer Profiling
• 7 Profiling Consumers for Old and New Media Markets
• 8 Psychological Profiling and Consumers’ Reactions to Marketing Campaigns
• 9 Practicalities, Pros, and Cons of Psychological Profiling
• Index