The Geodemographic profile is a tool used as a predictor of purchasing behaviour that performs part of an organisations marketing and operational toolkit.
The marketing or advertising department will use the profile to determine when and where advertising should take place in order to achieve maximum results. The demographic makeup of the market should guide advertising content as well. In addition, localised marketing strategy can be customised per retail outlet. Companies with internal customer data can use geodemography strategically when overlaying customer data on top of market data. Understanding the differences between current customers and the total market provides marketers with the ability to target content specific campaigns at customers vs potential customers from the point of view of growing market share.
Operational departments will use profiling to better understand cannibalisation between stores, as well as to identify locations for new outlets. Any feasibility study or impact analysis should include the geodemographic profile for the catchment or geographic area, as a predictive modelling tool. Geodemographic profiles are useful to merchandisers as a guideline for what ranges to stock per individual outlet.
Caution! Geodemographic profiles of large geographic areas are generally too broad for business application. Its important to understand the local geographic area well enough in order to use the profile as a micro marketing tool. If the area being analysed is too large, any useful data trends or anomolies will be averaged out.