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Marketing 360® Blog

Psychographic Data & The Age of Personalized Advertising

Post By Scott Yoder | Social Media Management

Today, marketers can use psychographics to understand and predict individual consumers needs and create timely, accurate personalized ads.  

There is an evolutionary trend emerging in the world of marketing and advertising.

In the preonline marketing -internet world, we had outbound marketing.  Push advertisements and material displayed to a vast audience in a largely indiscriminate way.  You’d watch a TV show and advertisements would interrupt you (and everyone else watching the show).  Advertisers hoped to find their target audience – while hitting everybody.

When Google emerged as a tool for everyday use, we started thinking in terms of inbound and permission marketing.  Now searchers use technology to find products and services when they have a need.  When they find something of interest, they give their permission for the brand to provide further info.  Advertisers make themselves findable when consumers seek them out instead of interrupting them when they’re not receptive.

In 2017 we are at the beginning of a new era of marketing and advertising built around personalization.  In this world, advertisers will understand individual consumers so well that they can personalize marketing materials so only what’s of interest to that person is displayed.  It will even be possible to make accurate predictions, so an ad can display to a target audience before they realize they have a need for the product.

This is not some futuristic, sci-fi story.  It’s happening today.

The key to understanding how this is possible – and how you can take advantage of it for your business – is psychographics.

Psychographics is the cousin of the more widely understood demographics.  But psychographics is really quite a different animal.  It’s data gathering and analysis on personality, values, interests, lifestyles, and opinions.

Consider this breakdown.

Demographic data:

  • Male
  • Age 25-35
  • Single, actively dates using online dating services
  • Uses products to curtail male pattern baldness, shops at Men’s Warehouse
  • Registered Republican
  • College graduate
  • Has annual income between $60-80k

Psychographic data:

  • Single but is interested in a serious relationship and marriage
  • Fashion conscious and cares about his appearance and style
  • Wants to be seen as a successful business person
  • Fiscal conservative but more liberal on social issues
  • Status conscious and will spend on things like cars and bigger homes

Advertisers have long sought to better understand psychographics, but in the past their data was limited.  This is no longer the case.

The Social Media Goldmine

facebook wants you

Google search was the turning point for inbound marketing.  It was the tool that let consumers accurately search for things they desired.

Facebook – and the larger social media landscape – are becoming the turning point for personalized marketing.

In short, social media platforms are a goldmine for psychographics.  There have never been tools that could track people’s social and personal behaviors like Facebook, Instagram, or Twitter. Every time someone adds content or interacts with a friend on social, it’s recorded.  The more they interact online, the more detailed their psychographic profile becomes.

But that’s not all.  Facebook, for example, partners with data brokers including Epsilon, Acxiom, and Datalogix.  These companies track trillions of data points on consumer behavior and spending.  Are you engaged?  Do you date online?  Prefer imported beer?  Buy organic dog food?  Facebook knows it and uses the data to target new ads, personalized to your buying habits.

Let’s take our profile above.  Demographics tell us he’s single and concerned about his hair.  We can also see that he follows several men’s fashion pages and fashion-famous celebrities.

Say he reaches the age of 35 and he’s still using online dating services.  His psychographic profile suggests he’s still going to be conscious about his looks.  His purchase history shows he spends on high-end personal grooming products.  Putting the demographics, psychographics, and purchasing history together, an advertiser for anti-gray hair coloring could create a targeted ad campaign for him.

Likewise, a political candidate who’s a fiscal conservative but liberal on social issues could solicit his support.

Say he gets married and now he’s expecting his first child.  A real-estate agent could target an advertisement for upscale homes in a family-friendly community.

If you have not started to see these types of sponsored posts in your timeline, you soon will.  For example, it’s clear that Facebook knows about my interests as a writer.  This ad showed up today in my timeline:

facebook psychographic ad

I’ve never heard of this brand or service, yet it’s so well targeted it seems uncanny.  In fact, it’s a result of using psychographics.

Platforms like Facebook are more cognizant of the recipient of the ad than any other type of advertising.  They are the total opposite of outbound, push marketing.  Their biggest goal is to ensure users don’t have irrelevant info cluttering their experience.

Many people have mixed feelings about personalized advertising.  On the one hand, it’s scary to realize how much technology companies know about your behavior, shopping habits, and lifestyle. There are legitimate privacy concerns to contend with.

On the other hand, how nice is it to have tailored advertisements delivered to you that actually reflect your needs and interests?  It’s a far cry from the intrusive commercials of old, and an enhancement from trying to search out everything that might be of use to you.

Personalized marketing is still at a nascent stage, so the next five years will tell us a lot.  But in many ways, this future is here now.  It’s to your advantage as a business to understand and stay ahead of these changes.