Market Segmentation within a Zip Code lets Marketers cherry-pick just the right audiences for specific products and services. All products and services are bought and sold because of one basic principle, "SUPPLY AND DEMAND". Contrary to what some marketers believe, consumers do not buy products and services because their name is Smith or Jones, or even because of how much money they make. The majority percentage (about 99.5%) of the consuming public buy because of three (3) reasons, "NEED, DESIRE and ABILITY". Unlike most list compilers, we realize the value of the total target audience equation. The real value of our Micro-Zip Code Marketing process is that we consider and evaluate all 3 pieces of the consumer buying process. Our Zip Code section system, is first, a means of measuring the buying performance of households within a select household audience. By measuring the actual buying performance, we save our clients thousands of dollars of advertising costs to households that could buy, but don't need or don't want to buy. We don't happen to care how old the occupants are, what their name might be or even how much money they make. All we want to know is "DO THEY BUY" and "AT WHAT RATE".
For the most part, 85% of the household market is going to consistently do the same thing, all the time, everywhere. There is, however, a 15% variable in that level of consistant performance. This variable is attributed to that segment of the market on the fringe of both ends of the buying spectrum that either buy or don't buy. In the average 15,000 household zip code, there are 3,000 to 5,000 households that are going to buy approximately 80% of all the business sold. The balance of the households in the zip code either don't want to buy, don't need to buy or can't afford to buy. So, you can safely eliminate these households from the cost of promotion without too much loss in potential sales and profits.
Marketers sometimes forget that advertising and promotion do not create a market for products and services. Those markets either exist or don't exist. The function of the marketer is only to fill those markets with products and services as the need arises. The primary function of our Micro-Zip segmentation is to give marketers of products and services a method of isolating those household audiences that have the highest level of need, desire and ability to buy. This built-in Database feature saves our clients thousands of normally wasted advertising and promotional dollars.
Shown above is Zip Code 75093 in Plano, Tx. It illustrates how an average Zip Code might be segmented. Each Micro-Zip or Section consists of households that are approximately equal economically to all other households within the section. That means that each household within the section can "AFFORD" to buy about the same products and services utilized by all other households within that specific audience. Every section within a Zip Code will buy your products or services at some rate.
The first section you want to target is the section that actually buys the most. Once that section has been identified, you look for the section that is number 2 on the scale of importance. And so on, and so on and so on, until you reach a point where it is no longer cost effective to spend promotion dollars on an audience. However, each section within each Zip Code is different in geographic location, type of household and economic level. These are all factors that need to be taken into consideration when planning a successful promotional marketing program.