Do Psychographics work in B2B Marketing & Sales?

B2B marketers regularly use demographic data of tangible characteristics such as company size, industry classification, number of employees, etc. to segment and target relevant markets. While B2C marketers do use demographics, they also use psychographics to really understand what interests their prospective buyers. Psychographics classifies prospective buyers by psychological attitudes such as aspirations, interests, attitudes, opinions, etc. From a marketing perspective, demographics define what buyers commonly need whereas psychographics define what specific groups of buyers want.

From what I’ve experienced and seen, B2B marketers typically make little or no use of psychographics. The supposed issue is that you’re selling to a business, so there are no psychographics. IMO, that’s wrong and B2B marketers are missing out on connecting with the real context of their prospects and customers.

I see an over-reliance by B2B marketers on industry classifications (SIC, NAICS, NACE, etc.) and company size (revenue, employee count) demographic data for market segmentation without relevant psychographic qualification. A CEO/President of a $50m company doesn’t think of his/her business as ‘small’ – they may see the company an innovative market leader in their vertical industry and market. Their solution requirements may be very different from what the ‘small’ demographic typically defines. While the standard industry classification may tell part of the story, it provides you with same analysis as your competitors and no qualitative differentiation for defining your market segments. The point here is that the product, service, solution that a group of companies really want could be quite different from what the broader pack needs.

“Continue to surprise those who would put you in a neat demographic. Be insistently curious.” – Gordon Gee

The other aspect of psychographics in B2B marketing and selling is that your prospective buyers, influencers and decision makers are real people with psychographic profiles. The production manager may view him/herself as the de-facto COO with broader purview in the business, or the material planner may aspire to be the production manager. You need to market and sell to the views, aspirations and interests of the people who will ultimately decide whether or not to buy your stuff. Does your value proposition and solution support these views, aspirations, opinions and interests? The material planner, who is probably an influencer, will only support your solution if he/she can see it directly supporting their aspiration to be production manager.

You can’t just go out and buy psychographic data like we buy demographic data – it generally requires primary research. This is actually a good thing since the primary research will be tailored to your situation, providing valuable data and analysis to really differentiate yourself from competitors and connect more specifically with buyers in target markets. The primary research doesn’t have to be a major expense – a well constructed online survey can provide good data.

If you are a B2B marketer, do you use psychographics and if so, how do you collect the data, and how has this worked for you?

As always, your comments are welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

5 comments:

Lee Levitt said...

Mike,

Great conversation. A few sales organizations absolutely do use company psychographics to target customers and to use specific outreach approaches to companies with varying psychographic profiles. Most companies, on the other hand, either don't know that this is important or believe that it's too hard to do!

Kenji said...

I am curious to see the papers about this.

My feeling is that this would be an exciting thing to research!

jeff said...

Psychographics can be good to help your agency "actually get it" when it comes to the customer's mindset.... but all the numbers and research in the world won't help if customers look at you and think "they just don't get it"

Maryam said...

Good read! thank you.

Beth Harte said...

Hi Mike,

Happy New Year! I just stumbled across your blog while searching on B2B psychographics. :)

I really like your post and agree with much of what you've said. I wish more folks would talk about psychographics in B2B marketing...it's essential!

David Meerman Scott and the folks at Pragmatic Marketing have been stressing personas (i.e. psychographics) for a long time.

The challenge, as I've encountered it is the research you point out...and the lack of actual personal knowledge of customers. Marketers shouldn't rely on sales to determine their customers' personas. They should be out there talking to them too! Social media helps with that, but there other ways to accomplish it that don't need to be so public (i.e. meetings, forums, councils, etc.).

Beth Harte
Community Manager, MarketingProfs
@bethharte