July 27, 2011
Plugging Census Data Into Your Direct Marketing
Census data and its marketing use are big news for marketers, with details being widely covered in articles, blogs, and webinars.
An April 4 article in AdAge cited Five Surprising Facts Marketers Should Know About 2010 Census Stats:
- Compared to the 2000 Census, fewer children now live in the Northeast and Midwest.
- Minority populations grew eight times faster than white, non-Hispanic populations.
- Hispanics are highly concentrated, with 75% living in just eight states.
- The Asian population is the fastest-growing racial or ethnic group, and is also highly concentrated.
- Many African-Americans are moving to the suburbs and to the South.
To this list of demographic changes since the last Census, blogger Brad Hanna adds wealth redistribution, with those earning $50K to $150K per year shrinking 2% since the last Census. “While this change may not seem like a huge difference at first glance, it actually represents a $292 billion drop in total consumer income,” Hanna writes.
On April 5, a webinar hosted by the Census Bureau, the American Marketing Association, and Geospace highlighted additional data:
- The “minority” population increased from 86.9 million to 111.9 million between 2000 and 2010, representing more than one third of the population.
- Larger proportions of the white population are found in Vermont, Maine, West Virginia, New Hampshire, and Iowa, all more than 90 percent white.
- The Census Bureau projects that the Hispanic population will grow to 30% in the next four years.
- Asians have the highest level of education attainment and the highest household income.
In addition to general Census highlights, AdAge reported on how some agencies are putting the Census data to use, namely: to enrich database marketing and analytics and measure size. In addition, by appending research (shopping behavior, media coverage in given areas, spending by household, etc.) available from other sources, marketers can drill down deeply within consumer segments.
How might this actually work? The webinar offered listeners a case study on how to apply Census data. Cesar Melgoza, founder and CEO of market research firm Geospace, presented a list of 14 types of so-called “actionable intelligence,” for example, “determining buying potential within a specifically defined target.” Melgoza also presented a fictitious case study to demonstrate how “actionable intelligence” might work in a marketing department.
In his example, the CEO of an insurance provider suspects that “do-it-yourselfers” could be a good target for homeowners insurance. The premise is intuitive and unproven, so the first step is to identify homeowners who are avid DIYers. If viable, the plan is to extend the offer both via point-of-sale and via direct marketing.
The marketing department develops a pilot plan that involves enriching a DIY data file with a home improvement retailer’s loyalty file. Next, the marketing department segments prospects by key categories and then plots retail shopping behavior to adjust the offer’s relevance (for example, DIY spend, homeowner status, lifetime value estimate, life stage, Hispanic dimensions, etc.).
Finally, media options are overlaid on the data (radio, cable TV, mail, telemarketing, email, etc.), along with a visual mapping of stores to demonstrate buying potential in specific areas. Melgoza points out that such a deliberate, data-based approach provides a sound basis for decision-making.
Throughout 2011, the U.S. Census Bureau will be releasing “briefs” with additional information on race/ethnic/age/gender groups, as well as demographic profiles broken down by states. We’ll stay tuned.
For an interesting perspective on emotion drivers that affect the consumer’s decision-making process, download EU’s free resource guide, 13 Ways to Drive Emotion.
