Key Takeaways:
Learn the differences between demographics and psychographics.
Understand how values are at the heart of psychographics.
Grasp how psychographics and predictive AI contribute to personalization.
Find out which email platform we recommend for precise segmentation.
You might know your customers’ ages and locations. But do you know why they buy from you?
As a retailer, it’s easy to stop at demographics and miss the deeper insights that drive real loyalty. Let’s dive into the difference between demographics and psychographics, why understanding your customers’ values matters, and how tools like generative AI and Klaviyo can help you elevate personalization and build stronger connections.
“Demographics has to do with who your customers are and psychographics has to do with the why behind their buying behaviors.”
– Technology Therapy® Group
Understanding Demographics and Psychographics
Both demographics and psychographics are essential for personalization. Let’s compare how they’re different.
- Demographics
Demographics is a method for getting to know your audience based on their socio-economic characteristics. These include age, gender, location, education level, and income bracket.
- Psychographics
Pyschographics go deeper than demographics. It’s a method for understanding your audience based on psychological traits. These include things like values, interests, attitudes, lifestyles, goals, and personality.
Still confused? Think of it this way: demographics has to do with who your customers are and psychographics has to do with the why behind their buying behaviors.
Leaning Into Psychographics: The Importance of Identifying Customers’ Values
It’s important to point out that values are at the core of psychographics. As a business owner, prioritize paying attention to what your customers value. According to research from Ipsos, 7 in 10 U.S. adults say they tend to buy brands that reflect their personal values.
But how do you find out what your customers value? Ask them. This can take the form of a short survey or feedback form you email to them after they make a purchase.
You can also scan your customer reviews for value statements. (Bonus: A simple way to do this is to export your Google reviews to an AI tool like ChatGPT and have it analyze the comments to pull out value statements.)
Leveraging Psychographics and Predictive AI for Better Personalization
Today’s customers expect you to know them deeply. Per research from McKinsey & Company, 71% of consumers expect companies to deliver personalized interactions, and 76% get frustrated when it doesn’t happen. Modern shoppers want you to know:
- What they searched for
- What info they accessed on your marketing channels
- What they purchased
- What they’re considering buying next
“Use AI to analyze behavioral data from your customers to identify patterns. Not only is it great at pinpointing current trends, but it can also use that body of data to predict how your shoppers will act in the future.”
– Technology Therapy® Group
Tapping into Psychographics and Predictive AI for Hyper-Personalization
When you go beyond demographics and start adding in psychographics to the mix, you can fine-tune your audience segmentation so it’s hyper-personalized. And you can track how your target audience’s psychographics shift over time and adjust your marketing strategy accordingly.
AI is an effective tool to use to analyze behavioral data from your customers to identify patterns. Not only is it great at pinpointing current trends, but it can also use that body of data to forecast how your shoppers will act in the future. It’s something marketers refer to as predictive personalization. The AI tools use data and machine learning to anticipate what your shoppers will need and gravitate toward in the upcoming days, weeks, and months.
More Precise Segmentation: Bridging Demographics & Psychographics.
Smart segmentation is the #1 reason why we recommend Klaviyo* to all our clients here at TTG. This platform draws on both demographics and psychographics. It gives you a more holistic view of your customers, so you can connect who shoppers are with why they buy.
This dual-layered approach gives small businesses a clearer picture of their audience and helps refine how they communicate. For example, two customers might share the same demographic profile, but their reasons for purchasing could be completely different. One might be motivated by sustainability, while another prioritizes convenience. With Klaviyo, you can account for both customers.
Klaviyo tracks customer behaviors in real time, such as browsing patterns, purchase frequency, and engagement with specific types of content. This enables you to build segments that reflect both identity and intent. And you can tailor everything from product recommendations to messaging tone based on what actually matters to each group.
Bringing It All Together
Understanding both demographics and psychographics gives you the context to deliver truly personalized experiences for your shoppers. Real connection happens where demographics and psychographics converge.
And, when you use a platform like Klaviyo to bring these insights together, you’ll enjoy these three perks: more precise segmentation, more relevant messaging, and stronger business-to-buyer relationships. It’s a practical first step toward hyper-personalization, which is the secret ingredient that lifts engagement and cultivates customer loyalty.
Move to Klaviyo the Easy Way
Ready to plug into Klaviyo’s segmentation superpowers? Let the TTG pros help you migrate.
*DISCLOSURE: Links included in this article might be affiliate links. If you purchase a product or service with the links that we provide, TTG may receive a small commission. There is no additional charge to you!
