Research Discussion

Share your findings from the Diffusion Theory Case Study research project assigned last week.

Demographics and Psychographics

Demographics and psychographics are two methods of compiling useful data about consumers.

Demographics are measurable statistics concerning a population, especially size, composition, and distribution.

Psychographics are studies of consumer personality and lifestyle, including our values and the way we express them in what we consume.


Population Growth and Distribution

Researchers like to study a number of factors involved with population growth and distribution.

  • where the majority of the population tends to live, and why
  • how many people move each year, and require related goods and services
  • changes in populations for metropolitan areas

This information helps marketers and business people determine:

  • where to place retail locations
  • what kinds of products and services to offer
  • how to communicate brand benefits to consumers
Population Growth and Distribution

Population Size Factors

The size of a given population is always in flux. Here are the major factors affecting population size:


The number of babies born each year in a specific geographical area. The U.S. welcomes about 4 million babies into the world each year, which is just enough to keep our population of 300 million constant.

The average age of new mothers affects marketing efforts as well. The birth rate for teens is decreasing, as the birth rate for women ages 35 to 44 is up.

Life Expectancy

How long people live, and how long they work before retirement.

How does the long average life span in the United States affect the strategies of marketers for fashion and other designed goods?


The number of people coming into the country and selecting a residential area.

The prominent group currently immigrating into the United States are of Hispanic origin. By 2025, the U.S. is predicted to have the second-largest Hispanic population in the world.

How are marketers reaching out to this community?


Income is the money or assets that people receive, typically defined per year, from their work and investments.

Income Distribution

The distribution of income throughout a population is never even.

How does income distribution affect the business strategies of Old Navy versus Neiman Marcus?

How can Lowe’s respond to fluctuations in income distribution?

Demographics and Psychographics Lowe's Fix in Six Vine series
Spending Patterns

How does income level affect spending?

Marketers often segment a population of consumers by spending patterns:

  • race
  • age
  • purchasing power (the amount of goods and services the dollar will buy in a given geographical region)


Moving Toward Gender Equality

In the past, marketers could safely make safe guesses about what sex bought which products. Can you think of examples?

What products are women buying now that were traditionally men-only?

What products are men buying now that were traditionally women-only?

Why is the old paradigm changing?

Marketing to Alternative Lifestyles

About 1-11% of the U.S. population identifies as GLBT (gay, lesbian, bisexual, and transgender). This group has the following qualities:

  • average income of $56,000
  • high rate of professional and creative occupations
  • well-educated
  • interested in the arts, travel, social reform, apparel, and home furnishings
  • tend to have fewer children

Why is this group of special interest to some marketers?

How can marketers best reach this demographic?

Education and Occupation

Typically, a college graduate will bring in a higher income than someone who has no degree.

Marketers believe that the more educated consumers become, the more goods and services they will want for themselves. Their level of exposure to new ideas through travel, education, and life experience ought to increase consumerism.

Do you think this belief is true, and why or why not?

The Origin of Lifestyles

Our values are the basis of our lifestyles. Marketers often measure lifestyles in AIOs:

  • Activities: work, hobbies, social life, shopping, etc.
  • Interests: family, home, community, job, media
  • Opinions: politics, business, education, culture

Obviously, there is some overlap with the study of demographics.

VALS Lifestyle Profiles

Which one of these do you think a marketer would categorize you under, and why?

Demographics and Psychographics VALS Lifestyle Profiles
  • receptive to new ideas and technologies
  • find image important, not as evidence of status or power, but as an expression of their taste, independence, and personality
  • their possessions and recreation reflect a cultivated taste for the finer things in life
  • well-educated and well-informed
  • practical consumers
  • look for functionality, durability, and value in products
  • conservative and conventional
  • choose familiar products and established brands
  • favor U.S. products and are loyal customers
  • goal-oriented
  • value stability over risk
  • like established, prestigious products that symbolize success
  • concerned about the opinions and approvals of others
  • favor stylish products that copy the purchases of people with greater material wealth
  • see shopping as a social activity and an opportunity to demonstrate to peers their ability to buy
  • enthusiastic and impulsive consumer
  • spend a high portion of their income on fashion, entertainment, and socializing
  • purchases reflect desire for “cool” products
  • have constructive skills and value self-sufficiency
  • suspicious of new ideas and large institutions
  • unimpressed by material possessions, and prefer value to luxury
  • have few resources
  • focus on meeting needs rather than fulfilling desires
  • cautious consumers who like discount brands