Product demographics are used to determine which group of consumers is most likely to buy a particular product. Knowing your target audience is critical for effectively designing and marketing your product, and by identifying your ideal consumer, you can develop a marketing strategy that appeals directly to your audience. Demographic information helps you tailor your product packaging, advertisements, location and pricing.

Importance of Demographics

In addition to encompassing the study of human populations, demographics represent the impact that populations have on the market. Demographics give you a view of your target consumers. Knowing the income status, age and shopping pattern of your customers can help you sell your product and even branch out to offer additional products. Once you know your target audience, you can focus your marketing efforts on those particular customers. For example, if research shows seniors are your largest audience, you may decide to make your website easy to read by using a large font with a light-colored background.

Sources of Demographics

You can draw information about prospective customers from sources of market research that have already been compiled. Your local chamber of commerce can provide demographic information about your city and state, and federal and state commerce departments also produce and collect demographics. For more specific information, you can hire a marketing research firm to conduct formal surveys. Research firms use structured, in-depth research to identify your customer base.

Do-it-Yourself Research

If you want to save money, conduct your own research. You can begin gathering information from and about your customers by testing the popularity of your product within a chosen community. Create surveys focusing on the questions you want answered. Sample the general population using informal, random surveys online or in person. As you begin receiving a positive response from certain individuals, focus on more in-depth interviews. You can monitor business trends by reading magazine, newspaper and journal articles related to business. Because the market is constantly changing, research demographics frequently.

Analyzing the Competition

Knowing your product demographics can help you size up the competition. By studying your competitors, you reveal what markets they are serving and where market opportunities still exist. For example, while shopping a line of T-shirts aimed at 20-year-old males who express interest in computers, you discover three other competitors in the area. If you are appealing to an age group overwhelmed with competitors, you might consider offering a wider range of products or focusing your efforts on a different age category. You can obtain information by calling on your competition as an interested customer to find out what types of products are available and at what price.