Use ACORN Demographics for Segmentation, Profiling, Targeting & Location Planning
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- Discover the characteristics of people in your market area
- Identify demand for your product or service.
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Q. How Does ACORN Segmentation Work?
A.The ACORN Demographic profiling system is applied to postcodes as shown below. So if you have the postcodes of customers, visitors or users we can very quickly identify what types of people they are and therefore segment by the varying ACORN Types, Groups or Classifications. Your ACORN segmentation may also band selected types together if you wish. The ACORN description tag can also be added to your customer, visitor or user database so you can track how your different segmented types act in future.
Q.Can ACORN Segmentation Only Describe Different Types of Customers?
A.No. Acorn segmentation or ACORN customer profiling will also enable you to identify what other needs your customers may have and show you what other services they currently use. ACORN segmentation and profiling will therefore enable you to:
Increase your understanding of your customers and prospects
Enable you to understand local population needs
Sharpen your marketing messages to make them more relevant to your customers and prospects
Target market more effectively
Assess the demand for services and products in any area you define
Optimise your branch and coverage in any area
Educate expansion planning – and highlight potential risks
Benchmark the underlying population against your customers
Q.Is ACORN Demographics Only Applicable Offline?
A.No, ACORN can now be used to target social media and online display advertising
Q.What is ACORN Geodemographics?
A.ACORN Geodemographics is a profiling system that is applied across the UK. ACORN is an acronym for a Classification of Residential Neighbourhoods. Under the system a many different demographic characteristics are reviewed to identify different types of people who can be clustered together for marketing purposes. Using the results of this analysis 62 different types of people have been identified. These Types are clustered together into 18 Groups, which are further clustered into 5 Classifications. This structure enables the easy application of the profiling system. Each postcode is tagged with the appropriate ACORN Type therefore enabling the profile to be easily applied to any customer database that includes post codes.
Q.Which Data Sources are Used to Create the ACORN Demographic Profiling System?
A.The demographic data used in developing the ACORN profiling system is drawn from the last UK Census and from many other sources, including land registry, data on social housing, private renting information and social housing, age data and lifestyle surveys. The benefits of this methodology is that ACORN can be continually updated.
Q. What is Market Segmentation by ACORN
A.Market segmentation simply means dividing your customers or prospects into separate groups that can be identified either by their personal characteristics or the products and services they need or buy. ACORN market segmentation is performed by measuring the different levels of product or service demand for each ACORN Type in the population.
Q. What Is Demographics?
A. Demographics is the study of people in UK and their characteristics. Everyone is different and these characteristics define the differences.
Q. What Characteristics Are Included in UK Demographics?
A. Demographic characteristics include: gender or sex, age or life stage, family group, wealth and income level, education level, type of housing, car ownership, occupation, number of children, religion, health and mobility etc.
Q. How Are Demographic Factors Identified?
A. Many of the core demographic UK factors are discovered via the national UK census that takes place every 10 years. The whole population is surveyed and the results are combined at postcode sector level. The census asks questions relating to age, family group, ethnicity, nationality, marital status, educational qualifications, employment, housing type, house ownership, nationality, car ownership and health. Other demographic factors are determined through household surveys undertaken by commercial companies. Product warranty card returns are also used to determine what people own and which types pf products selected types of people buy.
Q. What is Geodemographics?
A. Geodemographics is the linking of demographic factors to specific areas. The ‘geo’ element therefore refers to geography and enables different types of people within the UK to be identified.
Q. What Is the Difference Between Demographics and Psychographics?
A. Demographics factors include the physical and actual factors outlined above. Psychographics deals with the way that people think and behave. To some extent the way people think and act is determined by where and how they live, (demographics) but it is also affected by social factors and personal tastes.
Q. Can Demographics and Psychographics Be Combined?
A. Yes, several UK demographic profiling systems, including ACORN (A Classification Of Residential Neighbourhoods) combine data from both types of surveys to create a robust profiling model.
Q. What Demographics Are Important in Marketing?
A. Any and all of the demographic factors detailed previously can be important. Often life stage, or age, wealth (ability to pay) and gender are prime characteristics. However the mix of characteristics important to any product or service will depend on the product being marketed.
Q. Which Demographics Should be Included in a Survey
A. The demographic factors researched will be driven by the type of product or service that is the subject of the survey. These should normally include: age, gender and address as a minimum. If you have access to a UK demographic profiling system you can simply ask for the post code and the profiling system will do the rest. This will provide you with much more information than a survey respondent
is likely to give you.
Q. Where to Find Demographics Data
A. Demographic data is available from public sector organisations and commercial companies. Public sector source data is available for local authority areas. However collecting the data is time consuming and may require accessing areas under different authorities if you are researching an area. Several commercial companies, including CACI, produce demographic profiling systems such as ACORN demographics. These are available country wide which means that the data is available from a single source for areas irrespective of the local authority involved.
Q. Where to Find Demographics of an Area
A. Other than in libraries and local authority records, the best source is one of the demographic companies, such as ACORN produced by CACI. All you need to do is stipulate an area, which can either be a drivetime, a radius or a specified area. The company will then generate a report showing whichever demographic factors you require.
Q. Who Uses Demographics
A. Demographics are used by any organisation that deals with people – so every organisation has a degree of interest and use! Election time shows how important demographics are to politicians with each party seeking to identify who is the most likely to vote for them. Political campaigns are built by identifying which areas to target. Developers use demographics to identify the need for new facilities, businesses will use area demographics when undertaking location planning. Marketers will use demographics to build customer profiles as part of the development of a marketing strategy.
Q. When to Use Demographics in Marketing?
A. Successful organisations place the customer at their centre. The business is then built around the needs of the customer. Demographics are used to identify what services and products are required by target customers and they are also used to identify how they should be delivered, where they will be required and when those services are most likely to be needed. There is an old description of marketing which states:
Marketing is getting the right product, to the right people, at the right time, at the right price, with the right promotion, whilst making a profit.
Demographics should be used at every step of the marketing journey and therefore lies at the heart of marketing.
Q. What Does Demographic Marketing Mean?
A. Demographic marketing is where the demographics of the catchment area, customers and prospects are the key factors used to drive the marketing campaign. This should describe any marketing campaign, but often assumptions and personal preferences are used instead. This is a mistake as no-one can accurately guess the needs of a market. Customer reactions need to be tested and continually monitored to ensure that any organisation stays firmly on track.
Q. Why Are Demographics Important in Research?
A. Research is undertaken to identify why people want, need or use products or services. It should also identify which types of people are the most likely to buy or have no need for the product! So demographics are essential in building audience and customer profiles.
Q. Why are Demographics Important to Businesses?
Demographics are the bedrock upon which businesses are built. Every business is developed to serve the needs of its customers. So demographic knowledge is key.
Q. How are Demographics Used in Marketing?
A. Demographics are used to build customer profiles and audience profiles. Once the profiles have been developed, the profile characteristics are used to develop sales and promotional plans. Customer profiles will determine everything about a successful promotional campaign: public relations activity, advertising tone of voice, which publications to use for advertising and when to advertise, for planning door drop and direct mail campaigns, where to position bill boards. In short marketing is totally based on the understanding of demographics in the target market place.
Q. Can Demographics be Shown on a Map?
A. Yes, as demographic information is linked to postcodes, mapping individuals and populations is easy. Post codes have specific geographic points meaning that once the post code of a person is known, they can be shown on a map.
Q. What is a Demographic Heat Map?
A. This is a map that shows a selected demographic group as a ratio of the total population within a selected area. For example if an organisation wishes to see areas that are more suitable for stair lifts, they look for areas with high ratios of over 70 years olds and which have low numbers of bungalows! The ratios are calculated by postal sector and each sector is coloured appropriately. The heat map will then show the picture of the market area at a glance, with the ‘hottest’ areas being obvious.
Q. What is a demographic profiling system?
A. A demographic profiling system categorises people according to their demographic characteristics. It clusters similar types of people together to enable them to be easily identified. Whilst everyone is an individual, trying to track 60million or so people would be impossible. A profiling system simplifies the task by placing people with similar characteristics into categories. An example of a profiling system is ACORN. In the ACORN system there are six broad Categories, which sub divide into 18 Groups. These 18 Groups then split further into a total of 62 Types which enable the different characteristics of people to be more closely defined.
Q. How is a Demographic Profiling System Used in Marketing
A. A demographic profiling system can be used to discover the characteristics of customers, prospects and catchment areas. The broad types of people living within a postcode can be identified and categorised. By identifying where customers’ postcodes or the areas included in a catchment it is possible to create customer and area profiles. These profiles can then be compared to a base. This enables a marketer to identify which types of people have a propensity to buy from them or be found in a catchment area. By studying the characteristics of these key consumers it is also possible to identify how else a company may serve them or improve the way in which they market their existing services.
Q. How Are Demographics Used in Location Planning?
A. Demographics have a key role to play in the location planning for any B2C business, such as a retail store, hire shop, restaurant, health and fitness club, gym and a visitor attraction. The business developer or planner must have a good understanding of market need and market demand for the service they propose to deliver. This understanding can be gained through a demographic analysis of the primary catchment area. This analysis should include number of residents, number of key target customers, likely levels of demand, competition, transport network and any other salient factors that will impact on the performance of proposed new business.
Q. How Can Demographics Assist the Opening of a New Retail Business?
A. Retailing is all about selling product to willing customers. A retailer needs to know that the customers in his catchment area want to buy what he offers. Whilst the size of catchment areas will vary according to the specialisation and price of the retailers offer, it is important to identify what the primary catchment area will be and then review the demographics of the resident population to ensure that sufficient numbers of the right people live there. The locations of any competitor will also play a key role in this market understanding. Geo mapping of the area showing the key demographic data will therefore be a very important part of gaining the necessary market understanding.
Q. Can Demographics Assist in the Opening of a New Restaurant?
A. Most restaurants have clear target customers. They may be family restaurants, fine dining establishments or fast food businesses. Each style and restaurant brand has very clear markets it is seeking to provide. A thorough understanding of the catchment area demographics is therefore essential.
Q. Can Demographics Assist the Opening of a New Health and Fitness Club or Gym?
A. Health and fitness clubs and gyms appeal to specific types of people. Age is a principle factor, gender may be too, depending on the type of facility being developed and family groups can also be key. Some health and fitness facilities are developed for families, whilst others are mainly targeted at men or ladies. Knowing the size of the local population, the level of competition for the types of members you are targeting and how traffic flows work are generally very important factors to understand in the catchment area.
Q. Can Demographics Be Used to Develop an Online Business?
A. Yes. Many online businesses have the advantage that they have some details of their customers including their post code. These postcodes can be used to generate a demographic profile. Once this has been done you can see the characteristics of your best customers. It is then possible to either identify more people who match that profile or discover what other interests they have which can be used to generate additional sales revenue. More customers can be found either by offline methods focussed on particular residential neighbourhoods, such as leaflet dropping, or by using online marketing services. It is now possible to bid to place adverts onto the screens of selected people in any area, effectively giving demographics an online presence. This widens the scope of online demographics away from Facebook and other online platforms.
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