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Do you know your ABC?

Wednesday 14 November 2018 Catchment AnalysisData Insight & AnalyticsDemographic Data

Patrick Tate's picture
By Patrick Tate

Everyone knows that ABC1s are the most affluent consumers in the country.  Right?

Honing your audience down to ABC1s means that your targeting is working. Right?

Setting your budget based on the number of ABC1s will ensure that your resources are going to the right place. Right?

Erm….not quite!

For years, every marketer worth their salt would trumpet the accolades of ABC1s.  Back in the day (1960’s) they were seen as the pinnacle of wealthy, discerning, trend-setting consumers.  These top three rungs of the social grade ladder were largely defined through the status of their occupation and thought to be more educated with better paid jobs.

In the past 50 years we, in the UK, have had a fundamental shift in the way we work as well as the industries in which we work and the roles we’re employed in.  Gone are the distinctions between those in the office and those on the shop floor.  Skilled manual workers are now as attractive to commercial entities as their bosses.

A huge 60% of UK adults are now classed as ABC1.  That’s around 30 million people.

The problem with targeting ABC1s is that it isn’t actually targeting at all.  A huge 60% of UK adults are now classed as ABC1.  That’s around 30 million people.  This might be good for those products and services which are used by almost everybody (e.g. petrol), but if you’re looking to get the most out of your marketing budget and still target the best customers a better approach is necessary.
 

A New Way

The Office for National Statistics (ONS) recognised this problem and have been creating a classification of small areas since 1971.  ONS’s Output Area Classification (OAC) uses census data to classify output areas allowing public sector bodies to get a deeper understanding of local residents at the time of the most recent census.  I would encourage anybody who is new to consumer classifications or segmentations to download OAC free of charge to understand the power of such an approach.

Further on from OAC are the highly accurate commercial segmentations.  Acorn is ours.

Acorn was the first commercial geo-demographic segmentation in the UK, created way back in 1978.  Since then it has been rebuilt with the release of each census.  The most recent incarnation has had a major methodological overhaul and does not rely on any census data but uses, amongst others, Open Data sources which are updated much more frequently than the decennial census, resulting in a very up to date, very accurate postcode level segmentation.
 

1.1 billion data points

Classifications like Acorn allows marketers to hone their audience, refine their message and perfect their channels.  Acorn uses 1.1 billion data items to classify each postcode into 1 of 62 types and a further 800+ variables to help describe and understand each one.

So, if you are looking to market your product/service to wealthy families in suburban neighbourhoods, there are a couple of types which match your target resulting in an audience of around 2 million households or around 7.5% of the UK. 
 

From the above mentioned 800+ variables that help us understand them, we can infer that these customers:

  • Tend to shop for premium goods rather than standard
  • Shop online, not for bargains, but for the convenience
  • Are more likely to respond to direct marketing where they are referred to by name
  • No more likely than average to use social media
  • Use the internet daily:
    • Sites regularly visited include; John Lewis, M&S, Selfridges, Net-a-Porter
    • Regular users of services such as banking, insurance
    • Booking tickets (airline, events, travel and holidays)

At the other end of the spectrum, a local authority may be looking to increase recycling rates.  The 800+ variables now helps to decide which neighbourhoods should be targeted and more importantly which should not.

Simple analysis shows that young, educated people in urban neighbourhoods tend not to need to be told to recycle so targeting them with environment messages regardless of channel is a waste.

The make up of ABC1s makes them a very difficult audience to market to.  Imagine trying to create an eye-catching message that engages and resonates perfectly with all 30 million people. On top of this you’ll also need to try and choose the right channel that will deliver this message at the right time! This is what targeting ABC1s is fundamentally trying to do. By ‘targeting’ such a large proportion of the population, marketing messages (and marketing dollars) are diluted to a point that they don’t target anyone.

So you may know your ABC, but do you know your ABC1s?  In the 21st century its time to learn a new alphabet – A.C.O.R.N.

Find out even more about Acorn in our recent blog: Acorn Explained
 

Find out more

You can find out more about Acorn and discover which Acorn segment your neighbourhood belongs to here, view the product sheet, or get in touch to find out how Acorn can help your business

 

Everyone knows that ABC1s are the most affluent consumers in the country. Right? Honing your audience down to ABC1s means that your targeting is working. Right? Setting your budget based on the number of ABC1s will ensure that your resources are going to the right place. Right? Erm….not quite!

Do you know your ABC?

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