If we had to hazard a guess, we’d say that making money is probably central to your marketing plan. For that reason, most companies have spent a lot of time, money and effort learning who their customers are so they can personalize their advertising and more strategically market to them. These strategic marketing efforts seem to be focused on higher-income demographics, though, which may not come as much of a surprise. The surprising part is that it could be costing you money.
Pursuing Low-Income Consumers
According to research from marketing personalization platform Formation.ai, lower-income consumers are significantly less likely to see personalized ads. The platform surveyed 2,000 US consumers about the quality of the tailored marketing they saw. Less than one fifth of consumers making less than $31k per year felt that the marketing they see from brands is personalized to them. About 50% of consumers making $188k or more see ads tailored to them, though. Overall, there was an upward trend among income brackets regarding whether or not consumers saw ads that “extremely frequently” reflected messages personalized and relevant to them.
The logic makes sense on the surface. Low-income consumers have less disposable income to spend on goods and services they don’t absolutely need compared to consumers in top income brackets. However, Formation.ai also found that low-income consumers still spend up to 40% of their budget on luxury items and services. In other words, there’s a lot of money to be made by gaining and keeping these consumers’ loyalty.
There is an understandable reluctance on the part of some brands to dedicate resources for strategic marketing to low-income audiences, but it will pay off, at least as much as it does for top income earners. Across all income brackets, Formation.ai found that a similar portion of consumers said they were more likely to buy from brands that used more personalization tactics to reach them.
Untapping Potential
2020 and the coronavirus pandemic have tested conventional marketing beliefs in a number of ways, including perceptions of low-income and upper-income consumers. Many of the assumptions brands tended to make about which shoppers were interested in which products or services have been challenged. Low-income consumers are cooking meals at home more, taking on more home improvement projects in quarantine and investing in technology that will allow them to take on a remote working arrangement.
Behaviors that many marketers believed weren’t typical of low-income consumers have become much more common, and it has become more difficult to predict interests based purely on financial demographics. For this reason, segmenting consumers by income bracket isn’t a smart move. By personalizing experiences to consumers on an individual level, you can deliver messages relevant to them and avoid the pitfalls of standard segmented efforts.
Hyper-personalization is achieved through aggregating all available data from first and third party sources in order to provide the best promotions and offers for each consumer and boost overall engagement. As you create a strategic marketing plan for engaging low-income audiences, be sure to think of them beyond their financial status, and instead focus on the unique experiences that might draw them to your brand.
Let’s Strategize
Strategic marketing calls for a strategy, a plan for targeting low-income audiences and achieving your objectives. During any planning phase, you have a chance to analyze your brand’s strengths and challenges when engaging with a particular audience, how you should utilize technology and different media channels to reach them, how you can stand out in your industry and what your goals are for any marketing campaign.
As you prepare your strategic marketing and media plans, there are a few things to keep in mind if you want to have the best chance of reaching and positively engaging with low-income audiences.
Avoid Assumptions
Other than the income bracket they fall into, low-income consumers don’t necessarily have much in common. This group of people come from rural communities or urban neighborhoods; they’re young first-time parents or happily retired couples; they’re graduate students or middle-aged factory workers; they live with several roommates or in multigenerational households. The disparities can keep going.
The point is: each of these subgroups will require a unique strategy and messaging to effectively reach, so instead of trying to target them all, target those consumers that will be the best fit for you. Developing audience personas will help you narrow your focus down to the right people. Beyond basic demographic information, a persona considers everything from values, biases and knowledge to goals, aspirations and motivations of your ideal audience. By taking the time to map out these demographic and psychographic details, you’ll be able to determine who specifically you’re targeting, how you’re targeting them and where you’ll find them.
Don’t Beat Around the Bush
Let’s talk about how you plan to communicate with your audience. What will the tone of your marketing campaign be? In general, consumers in lower-income brackets are not moved by innuendo, sarcasm or overly sentimental creative. Instead, they prefer more straightforward, literal copy that is clear and to-the-point. After all, this is a savvy audience who must consider the value of every purchase much more carefully than someone with more disposable income.
Go Mobile
Low-income audiences are spending more and more time online via their mobile devices each year, and unlike their wealthier counterparts, they don’t mind mobile ads. According to IXI Services, a division of Equifax, consumers making over $100k in income in major metro areas tend to find mobile ads annoying, irritating and not informative. On the other hand, consumers making under $100k find them entertaining or informative. This remains true for people of any age with the exception of those over 65, and for people making less than $50k, their attitudes are even more favorable.
We Build Dynamic Media Plans Everyday
Think of strategic marketing as implementing specific processes designed to maximize your marketing efforts. Central to this approach is your strategic use of media and advertising. Whether you’re targeting working single mothers, first time homeowners, retired veterans or college-aged students, your marketing strategy and media plan need to be unique and well-researched.
If that seems like a lot, don’t worry. The media stewards at The Ward Group do this kind of thing everyday. We’ll take a holistic, omnichannel approach to media planning and buying to ensure you reach your target audience anywhere they might be. By doing this, we create consistent yet highly personalized advertising campaigns that expertly utilize your voice and messaging. Don’t miss out on reaching important subgroups in your target audience because you aren’t sure who they are, how to reach them or what to say to them. Contact The Ward Group today, and start being a little more strategic in your marketing efforts.