An Empirical Test of A Geodemographic Segmentation System - Part II

In Part I, we showed how the PRIZM NE geodemographic segmentation system was consistent with the individual-level survey data.  In that article, we were dealing with standard social and lifestage groups based upon income, age, urbanicity and presence of children at the zipcode level.  In this part, our intention to look at some of the smaller groups in the list of 66 segments of the PRIZM NE system.

We look at the segment known as "Young Digerati."  Here is the description:

Young Digerati are the nation's tech-savvy singles and couples living in fashionable neighborhoods on the urban fringes.  Affluent, highly educated and ethnicially mixed, Young Digerati communities are typically filled with trendy apartments and condos, fitness clubs and clothing boutiques, casual restaurants and all types of bars --- from juice to coffee to microbrew.

In the following chart, we compare the Young Digerati against the general American adult population on a number of attributes.

• 83% of the Young Digerati are internet users, compared to 65% of all adults.  Indeed, they are the digerati.
• Demographically, they are younger, better educated, have managerial and professional jobs and earn significantly more.  Racially, there is a disproportionately larger number of Asian Americans among them.
• Socially, they are more likely to use health clubs and gyms, go to bars and night clubs and attend concerts and theaters.

These incidences were obtained from the 2004 MARS study, which is a mail survey of 21,054 adults conducted during the first quarter of 2004.  These incidences, which are obtained independently of the PRIZM NE segmentation system,  are consistent with the description of the Young Digerati.

Young Digerati

(source:  MARS 2004)

As another example, we will look at the segment known as "Hometown Reitred".  The description is as follows:

With three-quarters of all residents over 65 years old, Hometown Retired is one of the oldest segments.  These racially mixed seniors tend to live in aging homes - half were build before 1958 - and typically get by on social security and modest pensions.  Because most never made it beyond high school and spent their working lives at blue-collar jobs, their retirements are extremely modest.

In the next chart, we show the demographic incidences of the "Hometown Retired" group versus the total adult population.  Indeed, they are more likely to be older, retired, less educated and with lesser income.

Hometown Retired

(source:  MARS 2004)

And if you wonder what the "Hometown Retired" do with their time, this is shown in the following chart.  They watch a lot more television than the general population, and they like to watch audience participation shows, games shows and soap operas.

Hometown Retired

(source:  MARS 2004)

We have given a couple of simple examples that show that results from an independent individual-level survey were consistent with the PRIZM NE geodemographic segmentation system.  Throughout all this, we remember that geodemographics is a second-best solution to actual individual-level data.  For example, not everybody in the "Hometown Retired" segment are retired.  The PRIZM NE can identify those zipcodes with lower than average incidences but these are still mixed neighborhoods in which some people work.  Still, accurate individual-level data is rarely ever available and the geodemographic segmentation systems will certainly improve effectiveness and efficiency over pure random guessing.

(posted by Roland Soong, 6/29/2004)