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In the new world of fragmentation and saturation, we can use media more efficiently if we rethink our assumptions

It should come as no surprise that the fragmentation of consumer media use is accelerating, not slowing. The new watch-word of media consumption is "choice"; consumers today pick and choose their media exposures with greater precision than ever before. The conventional balance of media power has already been rewritten; the Internet now claims 15 percent of the average consumer's media time, up from 10 percent just five years ago. Devices and services such as broadband Internet, DVRs, Web-enabled cell phones, and BlackBerry™ are giving consumers more opportunities and formats for connecting with the information and entertainment they want.

At the same time, marketers are challenged to reach narrower target audiences with high precision. There is no longer just a "children's market," for example; there are separate product lines and marketing strategies for "pre-tweens," "tweens," "teens," and "young adults." The key ingredient of any successful launch in this environment is getting the news about your product to its intended buyers—however small the group—at the highest rate of return.

Today, many marketers continue to buy media time based on broad demographics that increasingly may have little correlation to actual patterns of media use. Buyers and planners still talk about "18 to 49s," "upper-income households," and "families with kids"; but in today's world, these traditional demographics may be masking media use patterns rather than illuminating them. The assumption that a given age or income group—even a very narrow one—is likely to be using media homogeneously could well lead to the misallocation of media dollars.

Against this possibility, we looked for a way to integrate the media choices consumers make into a deeper portrait of them, one that could assist companies in targeting their marketing efforts—particularly advertising—with greater efficiency.

Where media use and product preference intersect

Our starting point was Knowledge Networks' MultiMedia Mentor™, which includes a single-source database of yesterday use of eight media among persons 18 to 64.¹ Leveraging this database, we conducted a latent class segmentation analysis that featured time spent with television (broadcast and cable), radio, the Internet, magazines, newspapers, and videogames as inputs. A media-centric segmentation, we felt, might help marketers target message and media better.

The results thus far include a breakdown of media audiences into distinct affinity groups, revealing intriguing connections between media, lifestyles, and product preferences. They suggest a more personalized approach to reaching consumers via media. And they tell us a great deal about how consumers are fitting media into their hectic lives. Let's begin with a brief overview.

In our current solution², we found seventeen segments—eight segments with a median age in the 35–49 age group, and seven with median household incomes of $50,000–$74,000 per year. Four groups have essentially no Internet use, and five are well below average in presence of children in the household. To provide a better sense of the nuances in these segments, we've profiled a diverse group of six segments with an eye toward seeing how they could serve us in planning media more efficiently.

Business Passionates: This segment's heavy daytime use of radio and the Internet suggests substantial time spent commuting and working. By contrast, their TV use is modest, and having high-speed Internet at home is more of a priority than digital cable service. Evenly split among men and women, Business Passionates rank second highest in household income and have no children. They travel regularly, for business or pleasure, and are the second most likely to have 401(k) accounts. Business Passionates represent 5 percent of the 18–64 population and account for 6 percent of total media time.

Power Parents: With the exception of daytime Internet, these consumers are modest users of media; they have by far the highest levels of digital cable subscription, but their time with broadcast channels exceeds their cable use. They have the highest household income level of all our segments, as well as a very high incidence of children in the home. They are heavy in movie rentals, DVD player ownership, and print subscriptions; not surprisingly, they travel frequently. One can infer that their media use is largely subservient to what little free time they have; they have a lot of media at their disposal, but not as much time to enjoy it. Representing 8 percent of the 18–64 population, Power Parents account for 8 percent of total media time.

Low-Tech Earners: Made up almost entirely of households with children, this group is still notably low in media use and spending. Their Internet time is almost nonexistent; though they are somewhat above average in satellite TV reception, they spend minimal time watching television. Their household incomes tend to be $50,000–$74,000. Low-Tech Earners represent 8 percent of the 18–64 population and account for 3 percent of total media time.

Cable Intensives: These are by far the heaviest users of cable TV—particularly during the daytime—and among the heaviest in Internet use. They rank second highest in digital cable and satellite subscription, but are essentially average in many other media use and technology categories. Evenly split among households with and without kids, and skewed slightly toward women, they live in households earning $50,000–$74,000 annually. They are notably below average in employment levels, but above average in home improvement spending. Cable Intensives represent 6 percent of the 18–64 population and account for 10 percent of total media time.

Lads at Play: Typically 21–24 and 85 percent male, this group's videogame and online use numbers are three to seven times the average, with more than four hours of each day devoted to just these two media. More than two-thirds (67 percent) have broadband; they are big on movies (in the theater or rentals), carbonated soft drinks, and DVDs; they are also the segment most likely to have a cell phone bill of $100 or more per month. The Lads at Play live in households that pull down $50,000–$74,000 per year, with about one-third having kids in the home; Hispanics are somewhat underrepresented in this group, while its African-American contingent is exactly average. Representing 5 percent of the 18–64 population and 6 percent of all media time, this segment invites us to rethink our assumptions about young men and media.

Media 24/7s: This group is set apart by its intensive use of all media. Their time spent with newspapers, magazines, radio, television, and videogames is well above average. This group is average in Hispanic makeup—with a heavy concentration of English-acculturated families—and above average in African Americans. They are moviegoers and carbonated soft drink drinkers, with relatively high cell phone use and a high level of magazine subscription. Media 24/7s represent 3 percent of the 18–64 population and 6 percent of total media time.

Media as an indicator of lifestyles

These and the other segments studied may lay the groundwork for using media to target consumers in an age of media fragmentation and shifting brand loyalties. We see that media consumption can and should be understood as another consumer "choice"—one that says much about consumer priorities; at the same time, this segmentation shows us that we cannot view "Internet users" as a homogeneous group, any more than we can "35 to 49s" or "working women."

We anticipate using the results to refine strategies for reaching specific targets based on media consumption patterns. Take, for example, Business Passionates and Power Parents. While both groups are solidly in the 35–49 age group, tend to be affluent, and are Internet-engaged, their overall patterns of media use vary. To reach Business Passionates, one could largely forgo television spending in favor of the Internet; but TV would play an important role when courting Power Parents, as television is a player in their media mix.

This segmentation effort will be of greatest value, however, if the segments can be matched to specific targets. In our initial data explorations, we've found an interesting relationship between online use and home improvement spending. Business Passionates and Power Parents are two segments best reached via the Internet that also tend to spend the most on home improvement. One could argue that this relationship is purely income-driven; but other segments with above-average incomes and levels of home ownership still tend to spend less on home improvement. This could represent an opportunity for the home improvement industry to communicate with some of its most important potential and existing customers.

We also see in our existing segments that the most active movie renters are consistently above average in Internet use—even though these groups differ in such core demographics as income and presence of children in the household. Here, too, this kind of information could be leveraged by the movie industry and rental outlets to better reach customers.

As with any segmentation, it is reasonable to ask how one can locate the segments in the real world. With a media-centric segmentation, if a segment is of value to the marketer, how to reach its members is implicit in the segment definition. But we plan to move beyond the intuitive segment-location process, and build our final segment solution into our MultiMedia Mentor™ software to facilitate its use in the planning process.

Without reinventing our marketing and insight-gathering processes, we are likely to be left behind as consumers take media use to new levels of complexity. In a world where brand and product choices multiply weekly, media is no exception; the effects on traditional media-use patterns have been dramatic. By recognizing media choices as another aspect of consumers' identities, we can become more sophisticated in our efforts to reach target audiences with marketing messages—and make more efficient use of advertising dollars.

Maura E. Clancey is Vice President and Managing Director, Client Service, of Knowledge Networks/SRI. She can be reached at mclancey@knowledgenetworks.com.

Robert L. DeFelice is Vice President, Client Service, of Knowledge Networks/SRI. He can be reached at rdefelice@knowledgenetworks.com.

1 Throughout the year, we collect data via telephone on time spent with media in the previous twenty-four hours, as well as information about each respondent's demographics, product usage (including some brand-level data), sports interest, and other variables. Every six months, we add 2,500 new interviews (and delete the oldest 2,500 interviews) to maintain a two-year, 10,000-person database.

2 Work on this project began earlier this year. While we have reviewed several segmentation solutions, and are reporting in this article on one that we believe has merit, our current efforts remain a work in progress.

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