Psychographic Segmentation of Potential Customers - Essay Example

Research Proposal: What Methods are Available for Contemporary Marketers to Create Reliable Psychographic Segmentation of Potential s? By You Your Academic Organisation Date 1.0 Problem definition and research objectives Marketers, historically, have utilised geographic and demographic characteristics as the primary basis behind the division of consumers into viable market segments (Boone & Kurtz, 2006). Many businesses have found success through these rather traditional marketing efforts. However, as contemporary consumers become more sophisticated and complex markets, the need for fuller, more realistic portraits of consumer lifestyles is becoming more prevalent for todays marketers. In essence, a deeper need to understand the underlying values and lifestyles of consumer populations reflects the growing use of psychographic segmentation. Psychographics is the measure of the motivations behind a behaviour, including why an individual in a specific generation or income bracket will accept or reject a message, act on it or ignore it (Morgan, Levy & Fortin, 2002: 22). More simply put, psychographic profiling involves maintaining an understanding of the lifestyles and value systems of potential markets and how these values reflect personal motivation to purchase products. Westernised marketers have instituted a psychographic system known as the VALS2 chart, which characterises potential consumers as having eight specific character attributes. These include fulfilleds, achievers, experiencers, believers, strivers, makers, strugglers and actualisers (Boone & Kurtz). This psychographic chart implies that consumers will fall into one of these specific categories, labelling them, rather incorrectly, as the average consumer for each category. Research offers that many companies looking for enhanced marketing tactics often run into several obstacles when gathering consumer-related data, one of which is the assumption that psychographic data can aid in creating an "average consumer" template (Morgan, Levy & Fortin, 2002: 22). This acknowledgement implies that the average consumer really does not exist, therefore psychographic research tends to lead marketers to believe that a single, generic message would be appropriate to catch the attention of their perceived average consumer. Assuming that consumers can be positively categorised as average, or fitting within a specific profile, ultimately can lead to incorrect marketing packages. Many marketers have found substantial successes through psychographic research, however psychographic research has been illustrated as posing a significant problem to todays marketers. Cost is cited as the largest problem, due to the fact that excessive time commitment and large amounts of money are involved to design appropriate consumer questionnaires and in analysing data (Lewis, 1999). This suggests that without generating tremendous research labour and a sizeable research budget allocated to gathering data, psychographic profiling is often ineffective to marketing efforts. However, is this truly the case? Further, Schoenwald (2001) suggests that psychographic profiling is not a cure-all to achieve marketing success, rather it is simply a tool to be added to the collection of traditional segmentation strategies. In essence, the author implies that psychographic profiling, when used as a singular tool, cannot achieve reliable marketing results with enough credibility to produce a sound marketing campaign. The problem, according to Boone & Kurtz (2006), is that psychographic segmentation is not perceived as being an exact science. However, can a well-constructed set of questionnaires or surveys be the solution to using psychographic profiling as a singular, effective marketing tool? One major detriment to marketing research practises is that research questionnaires, when constructed by the marketers themselves tend to ask people about things they wouldnt normally ask themselves (Walker, 2002: 16). This suggests that marketers must consider questions related to the potential respondents level of self-awareness. Could poor research design be the major cause of why psychographic profiling is not considered a viable tool when used by itself? This proposed research intends to discover the answer. The main objective of this research project is to identify methods available for todays marketers to use psychographic research as a singular, viable tool to determine the most appropriate message for its intended target audiences. Is there a rationale behind questionnaire and survey construction that is more appropriate for consumer attitudes, thus leading to more quantifiable results? This research project will serve to answer this question. Are marketing failures, where psychographic profiling has been used, sometimes ineffective due to poor research design or is the market really too complex to use psychographic research results as a single tool? This research will serve to resolve this question. 2.0 Research Approach This proposed research study will take a descriptive research approach. Descriptive research is appropriate when measuring or describing specific characteristics of market phenomena or the who, what, when, where and how about the market characteristics under investigation (Moorman, 2006: N3). With one objective of this proposed research study to determine the relationship between research instrument construction and consumer behaviour, determining how market characteristics correlate with consumer responses will require a rather in-depth research process that is descriptive in nature. Weiten & Lloyd (2003) offer a correlational research study in which the researcher makes systematic observations to determine whether a link or association between variables exists. Correlational research will require measurement of specific consumer attitudes and applying responses to an unrelated marketing issue to determine whether a correlation exists, which will either support the VALS2 concept or offer methods to enhance the scale. Further, the responses of consumers will be compared to their own self-assessment to determine whether a psychographic trend exists. Following on from this research approach, the study will be both qualitative and qualitative in design, as determining correlations between responses will require a research design more descriptive in nature. Henslin (2003) offers that qualitative research methods are generally utilised when emphasis is placed on describing and interpreting market behaviour. The author further suggests that qualitative research tends to emphasise precise measurements which will be appropriate for determining whether a correlation exists between psychographic self-assessment and the use of research instruments. 3.0 Sampling size This research plans to target a sample population of approximately 150-250 consumers, which will be targeted at random in order to gain a broader perspective of many demographic groups, including various age ranges and, likely, differing income brackets will also be reflected in the research. The aforementioned sample size will ensure a more credible and reliable research project by examining the psychographic self-assessments of generally unrelated markets. 3.1 Sample method The researcher will examine a wide variety of secondary literature involving psychological principles which will discover whether a trend exists for consumers in the UK regarding self-awareness. Are most of todays consumers in the UK notoriously documented as maintaining low levels of self-awareness? A solid review of secondary literature from professionals in psychology will shed light into the emotional and mental maturity levels of contemporary consumers. Results of the secondary literature will justify the creation of the research instruments, in this case the consumer survey. The marketing problem has been illustrated that many marketers tend to ask consumers questions that these consumers would not normally ask themselves. Based on the results of the secondary research study, an appropriate set of survey questions can be constructed that are most suited to the psychological profiles of contemporary consumers. The primary portion of this proposed research will involve showing the VALS2 categories to each potential respondent, asking each consumer to identify which category they, themselves, feel is most appropriate for their lifestyle. Once each respondents self-assessment has been recorded, each consumer will be shown a promotional mock up about a fictional product and asked to offer feedback about the marketing message. Questions such as How do you feel about this product or What emotion would you attach to this product will be proposed. This will create the opportunity for a correlation to be identified which will indicate whether specific consumer demographics tend to label themselves as a particular VALS2 category and whether other respondents fitting the same VALS2 category view the same marketing message with similar or different viewpoints. If a correlation is discovered to exist, supporting or refuting the use of psychographic profiles as a singular, viable marketing tool will be discovered. 4.0 Data Collection The secondary research portion of this study will require approximately four to six weeks in order to fully explore psychological texts for information regarding consumer attitudes. Another one to two weeks will be required to analyse the secondary research and construct appropriate consumer questionnaires designed around the research results. Using this timetable, another four weeks will be required to carry out the primary portion of this study and to survey the desired sample populations. After completion of the survey, this research will require another three to five weeks to plot and analyse the collected data. Once the data has been analysed, another one to three weeks to create a detailed marketing report will be required. In total, this research study requires approximately 15 weeks of secondary and primary data collection and analyses. 4.1 Instructions to fieldworkers No additional individuals, other than this researcher, will be required to perform both the secondary and primary portions of this study. With a sample population proposed at 150-250, the research efforts are anticipated to return a substantial amount of data in need of analysis. For the purpose of ensuring no data corruption, the study will be conducted by only this researcher. 5.0 Data Analysis The secondary research portion of this study will require extensive reading in order to create a valid psychological profile of todays consumer and to justify the creation of the survey instruments. The primary study will require several methods to analyse the data: Basic software packages – Microsoft Office products, including the use of Excel to record respondent demographics, will be utilised to electronically store the consumer data as a backup to the research notes. Excel maintains several different chart options which will be utilised to illustrate, graphically, any similarities or discrepancies discovered in the research. Correlational relationships – All of the respondents who indicate similar VALS2 self-assessments will be plotted on an X and Y graph which will be established with the X axis consisting of consumer age ranges, and the Y axis consisting of VALS2 self-assessments (the eight categories). This chart will illustrate where specific age demographics correlate with VALS2 results. Additional records – Each respondents reaction to the fictional promotional message will also be charted in basic spreadsheet software. All responses will be transposed in a pie chart format, which will indicate the levels to which consumers positively or negatively view the promotional message. This information will be compared with the VALS2 x and y axis chart to determine whether particular VALS2 self-assessments tend to view the message similarly or in direct opposite. The different analysis methods are necessary to fulfil the objectives of this study. The intention is to determine whether psychographic profiling can be utilised as a singular segmenting tool in order to achieve total marketing success. In order to accomplish this, an understanding between self-assessed consumer categories, age demographics, and positive or negative reactions to the promotional message must be established. The qualitative and quantitative analysis methods will indicate whether these correlations exist. 6.0 Research Ethics There are minimal ethical issues needing to be addressed in this proposed study. The Market Research Society Code of Conduct specifically mentions securing the protection of consumer data, in terms of ensuring anonymity for the respondents. A formal consent form will be constructed which will indicate the participant requirements of the survey, including an acknowledgement of no compensatory reward for participating as well as ensuring that all responses will be strictly anonymous and utilised only for an academics-related marketing research study. All participants surveyed will be at least 18 years of age, further satisfying the ethical considerations of this project regarding the receipt of consent for the use of minors in the study. Further, a notation to rule B8 of the Marketing Research Society code of conduct suggests that the name and organisation of the researcher should be disclosed to the potential survey population, which will also be listed on the participation consent form. One additional ethical issue that this researcher considered when designing this proposed research study involved the secondary research portion. The intention of gathering psychological data on consumer self-awareness, based on the results returned, may have minimal ethical repercussions on consumers who may or may not necessarily agree with the results of the secondary literature review. 7.0 Limitations This proposed research maintains several limitations, the first of which is budget constraints. All of the primary portion of this research study will need to be conducted in a public place (yet to be determined) such as a busy local shopping district. Budget constraints deny the utilisation of formal focus groups for the purpose of this study. However, surveying consumers in public venues can be attributed also as a strength to this research study, as random sampling of various demographic groups will supply this study with a broader range of consumer opinions; adding increased validity and reliability to this study. A further limitation to this study involves the creation of the fictional product promotional message, which will be shown to the surveyed respondents. This research instrument will likely not capture every existing marketing theory in its construction, however the promotional message will be designed to address all aspects of the marketing mix in this research attempt to apply consumer reactions specifically to the appropriate marketing theory. 8.0 References Boone, L. & Kurtz, D. (2006). Contemporary Marketing. 12th ed. Thomson South- Western, United Kingdom: 302,304. Henslin, James M. (2003). Sociology: A Down-To-Earth Approach. 6th ed. A & B Publishing, London: 144. Lewis, Barbara R. (1999). The Blackwell Encyclopaedic Dictionary of Marketing. Oxford. Moorman, Jerry, Ph.D. (2006). Descriptive Research. Mesa State College Lecture. http://home.mesastate.edu/~jmoorman/handouts/N3%20Descriptive%20Research.doc. Morgan, C., Levy, D. & Fortin, M. (2003). Psychographic Segmentation. Communication World. 20(1): 22-23. Schoenwald, Marvin. (2001). Psychographic Segmentation: Used or Abused? Brandweek. 42(4): 34. Walker, Michael. (2002). The problem with media managers: Too much emphasis on size and research, and a lack of creativity are just three flaws in the system. Marketing Magazine. 107(30): 16. Weiten, Wayne & Lloyd, Margaret A. (2003). Psychology Applied to Modern Life. 7th ed. Thomson Wadsworth, United Kingdom: 14. Appendices A: VALS2 Psychographic Template VALS2 Psychographic Template       Actualisers       Self-Confident Sceptical of Advertising Enjoy the finer things Frequent Readers Receptive to new products and technologies         Fulfilleds   Value knowledge Little interest in prestige Read widely Enjoy public programming       Achievers   Image Conscious Relatively Affluent Attracted to Premium Products Average TV watchers       Experiencers   Action-oriented Follow fashion and fads Buy on impulse Listen to Rock Music Spend much of disposable income on social activities         Believers   Traditional Family oriented Slow to change habits Look for bargains Watch TV more than average         Strivers   Image-conscious Prefer TV to reading Spend on clothing and personal-care products   Carry credit balances         Makers   Self-sufficient Shop for comfort Unimpressed by luxuries Read auto and home mechanics magazines       Strugglers   Restricted income Brand loyal Trust advertising Watch TV often Concerned with safety and security         Source: Boone & Kurtz (2006): p.302. 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