When assessing a market opportunity, most marketers start with profiling their potential customers based on objectively determined variables called “demographics”. A simplistic winnowing would include who they are, where they are, what they do, and their scope. Again as we know, a second profiling approach is through “psychographics”, which goes beyond demographics to examine how customers think, why they think it and, most importantly, what they will do as a result.
Demographic segmentation is important because it defines the scope of the opportunity, including potential lifetime value. Psychographic segmentation is important because names and buildings don’t buy products and services. People do. Said differently, demographic segmentation can quantify the short term and potential long term sales opportunity even down to the individual customer. But it’s up to psychographic segmentation to connect what the marketer has to sell with what the customer wants to buy.
Following is a case study with the Cragan psychographic segmentation model utilized when conducting focused fieldwork with two prospects who appeared to mirror each other demographically. But when it came to buying style, that mirror was broken. The study involves agriculture, and while some question the inclusion of ag as a B2B category, I would suggest that any category where an error in purchase decision can adversely affect not only livelihood but lifestyle as well, is…at the least…B2B. Just with far more riding on it than a purchasing agent’s next promotion.
James and Melvin were cash grain crop growers who raised their crops on the rich farmland of central Illinois. They had been born and raised there (4th and 5th generation farmers, actually), and lived less than ten miles from each other. James and Melvin each raised at least 1500 acres of corn and 500 acres of beans. Big operations, by any standard. The kind of operations that most knowledgeable ag observers would assume to be run by highly successful growers and marketers who could be Cragan-characterized as “Righteous”. That certainly was the ingoing bias that my research partner and I had when we drove into James’ driveway.
Nothing we saw there dispelled that notion. The white fence; large, immaculately maintained yard; a swimming pool, even; and off to the side John Deere tractors and implements that looked like they’d just come from the car wash. No mixing of green Deere and International Harvester red there, by golly! James was a Deere man and proud of it. Even the barns and storage facilities appeared to be freshly painted or cleaned.
James met us at the door, and as often happens in focused fieldwork when the researchers actually know the tribal language and marketplace dynamics, it wasn’t long before James was telling us things and expressing opinions he probably hadn’t even expressed at the coffee shop in town. It also wasn’t long before it was clear to us that we were talking with the prototypical “righteous” farmer/grower. James did everything the right way. When he sought the opinions of others, they were the experts. And he didn’t just grow his crops, he marketed them as well. James was an impressive guy; a delight to listen to.
We videotaped the entire interview, and despite all of the other learning over the previous two hours, it was the last two minutes that was the most revealing…and confirming. As we were preparing to leave, James asked us whom (he said “who” as would most people) we were off to see next. I said Melvin. The next fifteen seconds (which seemed twice as long), said everything that James wanted to say but wouldn’t about a neighbor. It was said on his face and in his demeanor. He later did note that Melvin “wasn’t doing all that well”. We weren’t sure what that meant. But each of the next three times we started to leave, James made additional comments clearly (but nicely) attempting to dissuade us from meeting with Melvin. Eventually we left…and met Melvin.
Actually we started learning before we met Melvin…when we started up a bumpy dirt road lined by barbed-wire fencing that many years ago had probably been taut. Or not. As we drove up Melvin was on his front porch sitting beneath the part of the roof that drooped the most He didn’t invite us inside; we later assumed that was good. But he did show us around a bit. Actually, Melvin had as much equipment as James. No Deere, but some Case, some I.H., some Ford and an implement that was probably a Vermeer, but I couldn’t tell beneath the rust.
We talked with Melvin about his operation, and found that he bought his seed corn by mail order; saved soybeans harvested from one crop to plant the next; didn’t rotate his crops but still didn’t use a corn soil insecticide; sold his crops to the local elevator; and if it wasn’t planting or harvest time, could usually be found at the same café that James frequented. Except James just stopped in while Melvin stayed most of the morning. And, not surprisingly, they usually didn’t sit together. A nice guy, Melvin. But when it came to perspective on anything agricultural, be it cultural practices or brands within a category, there is one thing you could be certain of: if James embraced or purchased it, Melvin wouldn’t. And vice versa. James was righteous; Melvin sometimes social, always pragmatic. And James knew why Melvin “wasn’t doing that well”.
Two men the same age. Neighbors. Operations about the same size. Growing about the same acreage of the same two crops. So demographically of about the same value to a selling marketer, right? Not even close. With James, if your product is the right product, he’s high value now and as long as you continue to meet his righteous expectations. With Melvin, you get a low volume, low margin customer. If ever a “customer” at all. And you know what…Melvin’s just fine with being Melvin. James just shakes his head.
The fact is, James reaction to our interviewing Melvin wasn’t only about Melvin. It’s because James thought he was being interviewed because he was one of the top growers in the area…because he did all the right things. But when we mentioned Melvin, that told James that we weren’t really there because of how successful he was. Instead, we were there only because of what he appeared to be on paper. Just like Melvin.