What are the Differences Between Demographics, Firmographics, and Psychographics in Marketing?


Successful marketing starts with understanding the methods and the process. In creating a target audience, you need to be able to properly segment that audience and classify them in a way that you can create marketing and sales campaigns around each of these classifications or elements. It’s not as complicated as it sounds—segmenting products by user age, gender, income level, or even personal need can go a long way in helping cultivate better audiences and targeting better campaigns. 

In this guide, we’ll talk more about the value of audience segmentation and how it works, including how demographics, firmographics, and psychographics all play their respective roles. 

Audience segmentation

One of the biggest elements of business success is being able to properly identify your target audience(s), as well as to properly segment them to deliver on their needs, desires, and problems with your products or services. Customers buy for their own reasons, not because you want them to. Therefore, you’ll want to be constantly educating your audience and delivering marketing resources that resonate with that particular group’s needs or problems. 

Targeted advertising is nearly twice as effective as blanket, or non-targeted marketing. Simply by taking the time to identify the characteristics of your target audience, you can almost double the effectiveness of your marketing. It’s really a no-brainer. 

When you can segment your audience properly, you will be able to create better marketing strategies that are tailored to each segment. You will be able to deliver above and beyond with custom solutions for all of your targeted groups, no matter how many you have. 

To properly segment audiences and markets, you need to consider three main classifications, depending on the type of customer you’re dealing with (firmographics is dedicated to B2B and doesn’t really apply to consumers, etc.—read on to learn more). Here’s what you need to know. 


Demographics is the one that most people are familiar with—the term “demographic” refers to a group of people classified by certain easily identified traits like:

  • Gender
  • Age
  • Income
  • Ethnicity
  • Family structure
  • Occupation
  • Level of education
  • Religion

Demographic segmentation has long been at the core of consumer-based marketing. It’s also been used in things like census surveys over the centuries to provide an accurate depiction of what kind of people are inhabiting the Earth at present. 

Of course, it’s not demographics alone that are classified. These aspects are also combined with psychographics and other marketing segmentation to ensure that the exact right customer is targeted for the current campaign. 


This segmentation classification is specifically for B2B businesses and designed to help them separate their clients based on specific organizational or company attributes. This helps to provide more direction in creating target audiences for various marketing campaigns, and usually includes elements like:

  • Company size and type
  • Industry
  • Annual revenue
  • Location
  • Employee/Executive title

For example, wanting to market to senior-level managers in enterprise corporations with more than X amount of revenue and X amount of employees is a very specific target audience based on firmographic information. 

These elements are an essential part of B2B marketing. The more details you have, the more you can custom tailor your messages and solutions, which will give you a better chance for conversions. 


The final category, psychographics, refers to the physiological attributes of a consumer. This helps you further define your market from demographic data. It allows you to refine or segment audiences based on:

  • Values
  • Attitudes
  • Lifestyles
  • Interests and hobbies
  • Behaviors

Taking the time to identify these elements will help you further segment your audiences and ensure that you have a clearly defined buyer persona to use for your marketing and sales efforts. 

For example, instead of marketing to 17-27 year-olds who generically like social media, you can use psychographics to narrow it down to the buyer persona of Dave, a 23-year-old who enjoys playing online games and does most of his shopping through social media ads

Objectivity is a must 

This is where things get tricky. Assumptions and stereotypes exist for a reason. Not only that, but some people will unintentionally recall or search for information based on their pre-existing knowledge. Known as confirmation bias, this should be avoided at all costs. It can derail your attempts at proper audience segmentation and make it difficult to grow your business. 

This happens all too often—as many as 42% of startups out there will fail because the owner(s) did not take the time to validate and prove the market need for a product. Essentially, they fail because the blind passion of the entrepreneur causes them to forget the value of research and testing in product creation and defining market needs. 

You can’t just rely on people who say they’ll use your product and service. You need hard proof of people who will actually buy your product or service. Assume nothing and research everything to find your target markets and ensure successful growth. 

While you’re targeting audiences, let Smith.ai take on the calls, emails, and more

Marketing and sales take up a lot of time in business. When you’re limited on resources, you might feel like you can’t possibly define markets, launch new campaigns, and manage all the leads that are going to start coming in—fortunately, you don’t have to. With the dedicated virtual receptionists at Smith.ai, you’ll never miss a beat, thanks to 24/7 phone answering, live website chat solutions, lead intake, and even appointment scheduling solutions. 

Plus, if you are limited on marketing resources in the first place, we can even offer our support for outbound sales and managing your outreach campaigns to grow your business. And we’ll do it all with a custom-tailored strategy to manage everything, giving you peace of mind and more time to focus on your business. 

To learn more, schedule a consultation to discuss how the 24/7 virtual receptionists at Smith.ai can help you reach your target audiences and more. You’ll also find us at hello@smith.ai or (650) 727-6484. 

Marketing Advice
Lead Generation
Written by Samir Sampat

Samir Sampat is a Marketing Manager with Smith.ai. He has experience working with businesses of all sizes focusing on marketing, communications, and business development.

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