[originally posted on ideavist.com]
I once heard a story about an online pet product company in the mid to late 1990's that illustrates the importance of psychographics in marketing, sales, and branding.
The online pet product company wanted to purchase an email marketing list for the purpose of emailing a coupon promo code for their first online purchase. During this time, the idea of email marketing and shopping online was still new.
The email list company they used basically bought ads that would make users fill out a long string of survey questions in the hope of winning some kind of prize.
The online pet product company would be charged per question they want to add to the survey, charged per character per question, for number of surveys completed, and it can only be a Yes/No question.
The pet company’s marketing team decided they wanted to just ask one short question — and one questions only — to save cost and to convert the most repeat customers. The pet company was targeting pet owners that would keep coming back to the website for more purchases regularly, not just because they received a coupon code.
Questions like, “Do you own a pet?” would not offer any insights as to whether or not they’d use the coupon, or even shop online. More transparent questions like “Are you highly likely to regularly buy pet supplies online if we emailed you a promo code?” would be, let’s face it, ridiculous. It would also be too expensive (charged per character, remember?), would probably net a sample size that’s too small to be of value.
Again, online shopping and email coupon codes were new phenomenon at the time. People might say “yes” just to get the code but have no intention of using it (think about all those free eBook downloads you never read). People might say “no” just because they didn’t understand the question (“What the heck is a promo code?” or “How can you purchase dog food online?”) If they understood the question, they may have actually marked “yes” instead. But the team literally couldn’t afford to educate the customer.
The marketing team eventually came up with one simple question: Do You Buy Gifts for Your Pet(s) for Christmas?
They determined that the psychographics of the person that said “yes” perfectly fit their target audience.
- already purchases pet supplies
- spends more money on their pets than the kind of person that does not buy gifts for their pets
- more likely to try shopping for pet supplies online than the kind of person that does not buy gifts for their pets
A close second question was “Do you buy costumes for your pet(s) on Halloween?” They opted for the Christmas version because they intuitively felt Christmas promos generate more sales than Halloween promos for both humans and pets. And they were launching after November anyway.
The email list they received was substantial, and they ended up converting 25% of the email list. By convert I don’t mean open rate, or even click-through rate. I’m talking about sales: 25% of the people on their email list actually made a purchase using the promo code, and most of them became return customers, as predicted.
They also ended up using the Halloween promo in the following year with similar success.
They knew exactly who their customer was and how to find them with one simple question.
I heard this story a long time ago. I don’t remember the name of the pet company, nor the person that told the story. Even though much has changed in email marketing and online shopping since then, the lesson is still relevant today: know thy customer.
How well do you know the psychographics of your ideal customer? If you were to buy an email list for your company this way, what one question would you ask to find your ideal customer?
Image Source: “Wee Westie — Toy Destroyer” by Randy Robertson (CreativeCommons — Flickr)
