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Generational segmentation – categorizing groups by the years they were born (e.g., Gen X, Y, Z) – is a myth for a number of reasons.
An Ehrenberg Bass / Sharpian “loyalist,” might find ‘category buyers’ and ‘non-category buyers,’ or ‘light buyers’ and ‘heavy buyers’ to be acceptable market segments. Otherwise, sophisticated mass marketing is the reality to targeting’s myth.
A more Ritsonian perspective emphasizes the marketing strategy holy trinity of ‘segment, target, & objective,’ where successful campaigns balance the long & short with non-double-duty ads (i.e., target in the short, mass reach in the long).
Someone who has spent a large portion of his vocation in Direct Response advertising, Rory Sutherland argues the industry has spent “far too much” time on “targeting optimization” at the expense of “creative optimization.” He adds, “The very fact that it’s measurable has made people obsess about what you can measure, on the assumption that what you can measure must be important.”
As with all advertising debates, it’s not binary.
Demographics can be useful: from long-term, big-picture trends; to product development; to physical availability (i.e., site location), and more. For example, Heineken recently launched Zagg, a malt energy drink in Nigeria, a market where ~70% of the population is under 30y/o. Traditionally focused on “masculine virility,” the Nigerian energy drink market relied on animals to communicate outdated ideas that didn’t resonate in-market.
Heineken’s creative response was ‘positioned in a way that goes beyond the category’s existing tropes. “It is countercultural; it is rooted in a resourceful, creative spirit; it’s rooted in a modern expression of hustle and imagination and ingenuity; and, critically, it’s all about a mindset,”’ said Lee Geraghty (Partner at Jump! Innovation). Heineken’s work is salient and expands the breadth of the new brand's Category Entry Points (CEPs) to a broad (and growing) demographic.
Demographics can help signal segments that could be receptive to new CEPs. For example, in Australia, people aged 29 are more likely to decide “they want the so-called security of marriage in order to start a family and to take out a mortgage” (this is captured in the national census). Richard Shotton, the author of The Choice Factory and The Illusion of Choice, calls these people the “nine-enders.” Said differently, one Millennial might be in-market for their first flat and a hatchback, while another might be in-market for a family home and a sedan.
Millennials, as a segment are unhelpful.
But, these long-term cultural trend analyses are important because the ages in which these shifts, or potential CEPs, occur change over time. For example, one factor driving declining annual fertility rates in the U.S., is women having children later in life. It is a similar story in the UK.
Zooming out further, demographic shifts become a BIG THING.
Author and VC, Morgan Housel argues that demographic shifts will reconfigure modern economies as people have fewer babies and live longer. An aging population means “everything from economic growth to workplace culture to the global order of nations gets shaken up.”
What does all this mean when we zoom back into a more advertising-centric perspective?
Martini, the 160-year-old alcohol brand, is targeting new customers based on values, rather than demographics. To maintain its iconic brand heritage while expanding the brand into new occasions and audiences, Martini is “looking to capture the values of the modern age that may resonate across the age demographics.”
From an effectiveness perspective, this makes sense. Research from Kantar found that it’s four times more effective to target campaigns by life stage and behavior than by age. A better way of targeting a more cohesive group, segmenting this way offers marketers a tighter brief for delivering impactful, relevant creative work. This is useful because quality creative offers marketers ~12x the impact targeting does.
It doesn’t matter how effective the targeting is if the creative is subpar. Given brands play in a loosely defined space of culture, social norms, memories, and identity, only the creative itself can deliver an emotionally-resonant reflection of values and beliefs. It is the creative that targets.
Advertising works best at scale, as a form of emotional inception or cultural imprinting, whereas many people as possible have a shared reality of what a brand stands for. In 2006, in the early days of the internet, Maurice Saatchi took this idea of cultural imprinting to the extreme with “one-word equity” (“the equivalent of having the best site on the high street, except the location is in the mind”).
Fast forward 16 years, and “constant internet usage allowed us to organize a far greater percentage of our human interaction around vertical communities. It let us find the people we identified with and interact with them, rather than being forced to interact with whoever was close to us on the map.” And, given fame is driven by 1 to 1 million distribution events, not 1x1 million to 1, it also means, for marketers, that it pays to authentically connect brand communications with communities so the internet can do what it does best: spread it.
Take the following ads for example – what do they have in common?
They connect with a wide range of Category Entry Points in a way that is authentic and relevant (aka on-brand). By defining audiences by hobbies, passions, values, and causes and less by race, age, gender, and occupation, these ads offer different audiences – with a variety of similar values – ways to connect with the brands.
By mapping brand values to communities, brands can amplify their reach and position for a broader audience in a more authentic way. Framed in terms of marketing science, this represents a better way to broaden and strengthen CEPs to win new customers or light buyers (the long tail where penetration and growth comes from). Or, as Rory Sutherland put wonderfully, “If you optimize targeting, that’s helping you find your customers. But good creative can actually create them.”
It’s the creative that targets.
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