Business demographics are statistical values based on a population that indicate various aspects of that population that can be useful for a business. This typically includes information about the spending habits of residents of a particular town or city, the ages of the people within a certain geographic region, and the types of activities in which people in an area often engage. Demographical information can also be related to a certain segment of the population in general, such as certain age ranges or people with a particular educational background, rather than geographical regions. Business demographics are often used to help a business understand where to locate, how to appeal to new customers, and where it may be successful already and in the future.
Sometimes referred to simply as demographics, business demographics is a group of information that can be used to better understand large segments of a population. If a business is interested in opening a new location, for example, then that business can use demographical information to determine where the new location should be. The business might know that the majority of its customers are single individuals of a certain income level. By using business demographics, that company can then determine where a large number of single people of that income range are located, and choose a new store location close to that area.
This is similar to how many entertainment industries utilize business demographics to better understand who to appeal to with a particular product. Record companies, for example, often use such demographic information to determine the age range of listeners to a particular musical group or performer. The company can then use that information to better aim marketing and advertisements for that performer to that age range. This use of business demographics often includes numerous disciplines and aspects of business coming together, to identify who is buying a product and better understand various traits of those customers.
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A great deal of business demographics information can be obtained through census data and similar government surveys issued throughout the year. This information is typically used to understand the economy of a country, region, or city, and identify what products people are spending money on and how people are prioritizing their spending. Businesses often use this information to anticipate how a new product may be received, and how to set the price for a product to indicate the greatest value possible for customers. Many companies also compile their own business demographics through market research, customer surveys, and feedback submitted by customers.