Psychographic Segmentation for Your Market Research Strategy

Create more relevant and personalized marketing messages, products, and services that appeal to your customers’ needs and preferences.

Godi Yeshaswi
October 20, 2023
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Marketers know how important it is to understand and segment their customers to attract them and sell their products. Among the ways to do this, there's one called "psychographic segmentation," which helps businesses understand individual customers better.

Psychographic segmentation is a secret weapon that helps market researchers find customers who like their products. It is like sorting people based on how they think and feel about products. This helps companies bridge the gap between what people like and what they sell.

In this article, we'll show you how to use psychographic segmentation to get to know your customers better and improve your market research.

What is psychographic segmentation?

Psychographic segmentation means putting people into groups based on things like what they believe in (values), what they want (goals), what they like to do (interests), and how they live (lifestyle).

This kind of grouping/segmentation in market research helps businesses understand why people buy things. It helps companies find the right people who want their products and find better ways to tell them about their products.

According to a report by Salesforce, 66% of the surveyed consumers say that the company’s ability to understand their individual needs impacts their loyalty.

Psychographic segmentation Vs. Demographic segmentation Vs. Behavioural segmentation

Demographics are like the basic facts about people, such as age, gender, and income. But just knowing these facts doesn't tell us everything about how people behave.

Similarly, behavioural segmentation is like sorting people based on what they do. For example, we look at what they buy and how often they buy it, whether they like our brand or not, and if they stick with us instead of choosing other brands. It's all about understanding their actions and preferences.

To understand people better, we also need to look at their actions – what they've done in the past, what they're doing now, and what they might do in the future. Combining these facts and actions helps companies build a complete picture of their target market psychographics.

This is where psychographic segmentation in market research comes in. It's a bit more complicated, but it helps us determine why people do what they do and why they are doing it. It dives into what drives their behavior from different angles.

Example of demographic segmentation 

  • Age: 20 – 35
  • Marital Status: Single
  • Country: United States
  • Annual income is in the range of $50,000 to $60,000

Example of psychographic segmentation

  • Concerned with globally famous brands.
  • Looking for a brand endorsed by a footballer.
  • Is willing to spend a bit more on shoes that minimize environmental impact
  • Enjoys outdoor activities such as running, football, etc. 
  • Favorite social networks are Twitter and Reddit.

Demographics and psychographics give you useful information separately. But when you put them together, you create a complete customer profile that really helps you understand them.

So, you not only know who your customers are but also why they buy from you. This makes your marketing efforts more effective, and you get more value for your money.


Variables and examples of psychographic segmentation

Psychographic segmentation is all about getting to the core of why people buy things, not just what they buy. To do this, let’s look at different variables and psychographic segmentation examples:


People's personalities influence what they like to buy. Think of it as whether they are outgoing, creative, agreeable, etc. Businesses must know their customers' personalities to sell them the right stuff. For example, a beer brewing company has discovered that most customers have extroverted personalities and like to enjoy their drinks with acquaintances. 


How people live and what they do daily can tell us what they want to buy. For example, a health bar brand changed its marketing for a specific segment that hikes after finding out that a segment of its consumers likes hiking.

Social Status 

Where people fit in society affects their choices. For example, a clothing brand could change its messaging strategy from high-quality products to long-lasting products for consumers of a lower social status. 

Hobbies and Interests

What people enjoy doing in their free time and what they believe in can also guide what they buy. For example, Nike makes different shoes for runners, basketball players, and fashion-conscious folks.

Values and Attitudes

People's beliefs and how they look at life matter, too. For example, if someone cares about sustainability, they might buy locally sourced products.

Understanding this helps businesses make products and ads that fit the people they want to sell to.

Importance of psychographic segmentation

Psychographic segmentation is a big deal in market research and marketing. Companies want to make stuff people want to buy, and what people want changes as they grow older and earn more money. The change in what people like is all about how their minds work. So, when a company figures out how consumers think, they can sell things they like. Here are some reasons why psychographic segmentation is super important for a company.

  • It helps companies figure out what bothers customers by looking at how they think, what they believe, and how they live.
  • It's super important when a company wants to make special stuff for certain customers. It helps companies create better buyer personas
  • It’ll help companies design products that match customers' needs and preferences more closely.
  • It is important for product positioning in a tight market with many players selling a similar product.
  • It can help companies identify gaps and pain points within the product.
  • It helps businesses distribute resources more effectively and economically, which improves the ROI.


Pros and cons of psychographic segmentation

Pros - 

Getting to know people better

Psychographic segmentation helps companies understand people really well. It's like creating a detailed profile of who they are and what they like, especially when we combine it with other ways of learning about them.

Discovering hidden thoughts 

It helps brands uncover what people think and feel, even if they don't say it out loud when making decisions.

More personalized advertising

By sorting people into different groups based on their interests and lifestyles, businesses can talk to them in a way that makes sense to them. This means the messages are more clear and convincing.

Adapting products to different people

Psychographic data shows us that different groups of people might like the same product for different reasons. This helps brands adjust how they market the product to fit the preferences of various audiences.

Cons - 


Psychographic segmentation is somewhat tricky to do. It's not as straightforward as some other methods because it involves asking people specific questions about their thoughts and feelings.

Need for clear guidelines

To make sense of the information gathered, brands have to set clear rules and standards because psychographic data can be open to different interpretations.


Creating surveys to collect psychographic data can be challenging because brands often have to make educated guesses about what the target audience thinks.

Doesn't always explain why people buy 

Psychographics can tell us a lot about people, but it doesn't always directly explain why they buy certain things. It's like a piece of the puzzle but not the whole story.


Getting useful psychographic information often requires doing quantitative (numbers-based) and qualitative (in-depth) research, which can cost quite a bit.

Make your market research stand out with audience psychographics

Psychographic segmentation is a method used to group people based on their psychological traits. This approach can help companies better connect with their audience, effectively tailor their messages, and encourage desired actions.

While demographics deal with more objective data, like age or location, psychographics are all about subjective and complex aspects of people's personalities and lifestyles. They are considered more qualitative in nature. Here are various ways to gather psychographic data, both qualitative and quantitative.


Focus Groups

Focus groups involve bringing together a diverse group of consumers to discuss a product or service. While they can provide valuable insights, group dynamics and strong personalities can sometimes delay discussions.


In-depth interviews with subject matter experts, customers, or individuals fitting your target profile can provide qualitative insights about their interests, goals, motivations, and how they relate to your products or services.


Third-party Data: 

Information from website analytics, browsing data, reviews, and social media engagement can be useful to gather valuable insights into how people interact with your brand and offerings. Techniques like social listening and sentiment analysis can provide deeper insights.


Whether online or in-person, questionnaires are an economical way to gather data. Surveys often require multiple questions to obtain a precise psychographic profile. For example, suppose a media and entertainment company wants to create a Detective Series. In that case, they may ask about attitudes toward crime, mystery, etc., to build a comprehensive psychographic profile.


How to use psychographic data to build marketing strategies?

To understand how psychographic segmentation can be used in marketing strategies, let's examine how companies worldwide have successfully employed it.

Harley Davidson

Harley Davidson, the motorcycle company, knows its customers very well. They've created a special community for them. You can easily spot Harley Davidson riders and fans because they have unique styles and attitudes. The brand appeals to people who love being a rebel and living a 'born to ride' lifestyle. Most Harley Davidson customers are between 25 and 40 years old, have a decent income, and can afford to spend money on their motorcycles.


Coca-Cola made different kinds of Coke for different types of people. They created Coca-Cola Zero and Diet Coke for those who care about their health and want a Coke without too much sugar and calories.


BMW, the luxury automobile brand, mainly targets wealthy people at the peak of their careers. BMW buyers are the type who appreciate beautiful, high-quality things. These characteristics are key to how BMW sees its current and future customers.

Bottom Line

Psychographics helps you understand not just who your customers are but why they like your stuff. It helps brands determine exactly who the customers are and what they like. With this knowledge, you can create personalized messages and offers that hit the mark. People sometimes feel distant from the brands they love in this digital age. But with psychographic segmentation, you can bridge that gap. It's a powerful tool to ensure you give your customers what they want and improve their lives.

Understanding their reasons keeps them interested in your brand now and later. The cool thing about psychographics is it lets you personalize your messages. When people get ads that feel like they're just for them, they like your brand more and stick around. It's important to make your current customers happy, not just new ones. With psychographics, you can keep current customers excited about your brand for a long time.


Supercharge your research with actionable insights faster on Decode's integrated consumer research platform with Insights AI.
Want to conduct lean and unbiased research? Try out Entropik's tech behavioral research platform today!
Want to conduct lean and unbiased research? Try out Entropik's tech behavioral research platform today!
Want to conduct lean and unbiased research? Try out Entropik's tech behavioral research platform today!
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Author Bio

Godi Yeshaswi
Yeshaswi is a dedicated and enthusiastic individual with a strong affinity for tech and all things content. When he's not at work, he channels his passion into his love for football, especially for F.C. Barcelona and the GOAT, Lionel Messi. Instead of hitting the town for parties, he prefers to spend quality time cuddling with his Golden Retriever, Oreo.

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