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Business Tip 2
Applying Demographic Data - Identifying a Target Market Based
on Ethnicity
If you read our last tip, you probably got your hands on some good, free demographic data. This tip introduces how to apply demographic data to make strategic decisions, specifically identifying a target geography based on the ethnicity of its population.
Basic Population Analysis
Imagine that you manage a category that skews almost entirely to a single ethnic group, like Shelf-Stable Vietnamese food, and you have funding to run a media campaign to drive traffic in just two markets. How would you choose which markets to target? The steps below illustrate how to use demographic data to identify your best bets.
- Get free demographic data. If you don't know how, read our last tip here
- Start by identifying the largest centers of population. You can do this by sharing the total Vietnamese Population of a geography to the total Vietnamese population in the US, like this:
This will allow you to rank geographies like this:
Right way, you can see that there are certain states that have a strong Vietnamese population. With a little thought, you can make this same data much more telling, though. How large is the Vietnamese population relative to that state's total population? You can add this level of detail by developing an index.
- Develop a Population Index based on the share numbers you've already generated:
Now you can add enough detail to make an informed decision.
The chart above clearly tells you that California and Texas are good target markets for Vietnamese products. California shows a large share of the total Vietnamese Market, and the represent an unusually high fraction of the state's total population. Texas is also a good bet, as it has both a strong population share, and population index relative to the total population of the state.
Analyses like the one mentioned about should be some of the basic tools in your arsenal for strategically managing your business. XP3, from Interactive Edge makes this, and many other processes, turn-key-giving you time to look at the big picture.
The data, products and accounts depicted in this example are fictitious. Any resemblance to actual data, products or accounts is purely coincidental. |
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