UK Geographics

Which one should you use?

Geodemographic Segmentation —— Definition

“Geodemographic segmentation refers to a range of methods used for classifying and characterizing neighbourhoods or localities based on the principal that residents living near each other are likely to have similar demographic, socio-economic and lifestyle characteristics. It is used for a wide range of purposes including direct marketing, retail location, service area analysis, housing market analysis, and public service targeting.”

Definition Source:

Encyclopedia of GIS, Shekhar Shashi, Xiong Hui, Springer US, 8 2008-01-01, A Troy, Austin, P 347-355

There are number of commercial and open source Geodemographic classifications. We DO NOT endorse any of them and this article is a simple summary of the available Geodemographic classifications in the UK. If you would like to talk to us about geodemographics, or other market discriminators or any other data please feel free to email at [email protected].

Creating a Geodemographic Classification

1. Use clustering method to assess number of potential clusters Geodemographic classification should have.
2. Decide on the geographical area you are going to use in clustering
3. Decide on the set of key variables for the geographical areas you are planning to cluster
4. Prepare data for clustering (transformations, standardisation, checking for outliers)
5. Decide on the number of clusters
6. Calculate and compare characteristics of the clusters, write pen-portraits for each cluster and assign names to each cluster.

Evaluating Geodemographic Classifications

All geodemographic classifications are based on the number of subjective decisions related to its creation (selection of variables or number of clusters). It is difficult to find an objective method of assessing how good one Geodemographic classification is compared to another. Ideally we would like to have a sample of each classification in order to assess which one will best serve user’s objectives.

Output Area Classification (ONS) 2011

Free geo-demographic classification from ONS.

• Data source: Census 2011
• Created by: ONS and UCL
• Year of release: 2014
• Coverage: UK
• Type: Three-tiered hierarchical geodemographic classification at Census 2011 Output Area Level
• Structure:   8 Supergroups,   26 Groups   and  76 Subgroups.

ACORN

Commercial Geodemographic classification from CACI.

• Data source: Census 2011, Open data, commercially sourced data, Proprietary data
• Created by: CACI
• Year of release: 2013
• Coverage: UK
• Type: Three-tiered Geodemographic classification at unit postcode level
• Structure:   6 categories,   18 groups and 62 types

Categories (1-6) /   Groups (A – R)

1-Affluent Achievers

A-Lavish Lifestyles

B-Executive Wealth

C-Mature Money

2-Rising Prosperity

D-City Sophisticates

E-Career Climbers

3-Comfortable Communities

F-Countryside Communities

G-Successful Suburb

H-Steady Neighbourhoods

I-Comfortable Seniors

J-Starting Out

4-Financilaly Stretched

K-Student Life

L-Modest Means

M-Striving Families

N-Poorer Pensioners

5-Urban Adversity

O-Young Hardship

P-Struggling Estates

Q-Difficult Circumstances

6-Not Private Households

R-Not Private Households

MOSAIC

Commercial Geodemographic classification from Experian.

• Data source: Census 2011, Open data, commercially sourced data, Proprietary data
• Created by: Experian
• Year of release: 2013
• Coverage: UK
• Type: Two-tiered Geodemographic classification at unit postcode level
• Structure: 15 groups and 66 Types

Groups (15)

A-City Prosperity

B-Prestige Positions

C-Country Living

D-Rural reality

E-Senior Security

F-Suburban Stability

G-Domestic Success

H-Aspiring Homemakers

I-Family Basics

J-Transient Renters

K-Municipal Challenge

L-Vintage Value

M-Modest Tradition

N-Urban Cohesion

O-Rental Hubs

PERSONICX

Commercial Geodemographic classification from Acxiom.

• Data source: Census 2011, Open data, commercially sourced data, Proprietary data
• Created by: Acxiom
• Year of release: 2014
• Coverage: UK
• Type: One tier Geodemographic classification at unit postcode level.
• Structure:   55 clusters

Example:               Cluster description

CAMEO UK

Commercial Geodemographic classification from Callcredit.

• Data source: Census 2011, Open data, commercially sourced data, Proprietary data
• Created by: Callcredit
• Year of release: 2013
• Type: Two-tiered Geodemographic classification
• Coverage: UK
• Structure:   10 groups and 68 categories

CAMEO UK Groups (1-10)

1-Business Elite

2-Prosperous Professionals

3-Flourishing Society

4-Content Communities

5-White Collar Neighbourhoods

6-Enterprising Mainstream

7-Paying the Mortgage

8-Cash Conscious Communities

9-On A Budget

10-Family Value

 P²-People and Places

Commercial Geodemographic classification from Beacon Dodsworth.

• Data source: Census 2001 and Lifestyle data
• Created by: Beacon Dodsworth
• Year of release: N/A
• Coverage: UK
• Type: Two-tiered Geodemographic classification
• Structure:   13 Trees and 40 Branches

Trees ( A- M)

A-Mature Oaks

B-Country Orchards

C-Blossoming Families

D-Rooted Households

E-Qualified Metropolitans

F-Senior Neighbourhoods

G-Suburban stability

H-New Starters

I-Multicultural Centres

J-Urban Producers

K-Weathered Communities

L-Disadvantaged Households

M-Urban Challenge

U-Unclassified

Hierarchical nature of postcode geography

Average number of delivery points per postcode is 18, mode is 14 and number of delivery points range from 1 to 100.

History

• 1856 – London was divided into 10 Postal Districts by Sir Rowland Hill who reformed and made postal services more efficient.
• Postal districts were denoted by letters such as N-northing, E-easting, etc.
• 1917-postal sub-districts introduced by adding numbers after postal districts.
• Today original postal district refers to Postcode Area and sub-districts to modern Postcode District.
• 1959-Decision was made to use Postcodes that contain both numeric and alphabetic characters. The first postcodes were introduced on a trial basis in Norwich.
• 1974- The whole of UK had been allocated to Postcodes.

Purpose

• Postcodes are used for efficient mail delivery in terms of the costs and speed.

Usage and Application

Postcodes and its spatial reference (coordinates) found application in almost all parts of UK’’s business and public life. Appending various auxiliary data to unit postcodes and postcode sectors provides great source of information for market analysis, public sector planning and small area economic planning.

• Location based analysis – each postcode have been allocated coordinates
• Linking Postal and Census geography
• Data visualisation – mapping
• Customer profiling
• Market and Opinion Research
• Geodemographics
• Marketing and Advertising /Direct Marketing
• Utilities
• Retail
• Media
• Local Authorities
• Health Authorities
• Police
• Catchment area analysis
• Financial services – banks, insurance companies

Approximated Social Grade with its six categories A, B, C1, C2, D and E is a socio-economic classification produced by the ONS (UK Office for National Statistics) by applying an algorithm developed by members of the MRS Census & Geodemographics Group.

• It applies to every Household Reference Persons (HRP) aged 16 to 64. If they are not the HRP and were working in the week before the Census, they receive their own Social Grade. If not a HRP and not working in the week before the Census, they receive the Social Grade of the HRP (source: MRS MRS Census & Geodemographics Group).
• It is a discriminatory tool for media consumption and purchasing power in general. It has been used by National Readership Survey to discriminate readers of popular newspapers.
• The Social Grade model has been based on  Occupational Code 2010 code, Employment status, Qualification, Tenure and whether respondents work Full time, Part time or not working.
• Social Grade based on the Census 2011 data is available for all four UK countries (England, Wales, Northern Ireland and Scotland).

Comparing 2001 and 2011 Social Grade !

“A broadly similar approach was applied to the 2001 Census, however it should be noted that the 2001 and 2011 Social Grade outputs were modelled using different algorithms, employing different variables. Therefore, it would be misleading to use Census outputs to examine trends in approximated Social Grade profiles between 2001 and 2011” (https://www.mrs.org.uk/cgg/social_grade).

Household Reference Person – DEFINITION (source: ONS)

The concept of a Household Reference Person (HRP) was introduced in the 2001 Census (in common with other government surveys in 2001/2) to replace the traditional concept of the ‘head of the household’.

HRPs provide an individual person within a household to act as a reference point for producing further derived statistics and for characterising a whole household according to characteristics of the chosen reference person.

For a person living alone, it follows that this person is the HRP. If a household contains only one family (with or without ungrouped individuals) then the HRP is the same as the Family Reference Person (FRP).
For families in which there is generational divide between family members that cannot be determined (Other related family), there is no FRP. Members of these families are treated the same as ungrouped individuals.
If there is more than one family in a household the HRP is chosen from among the FRPs using the same criteria used to choose the FRP. This means the HRP will be selected from the FRPs on the basis of their economic activity, in the priority order:

Economically active, employed, full-time, non-student
Economically active, employed, full-time, student
Economically active, employed, part-time, non-student
Economically active, employed, part-time, student
Economically active, unemployed, non-student
Economically active, unemployed, student
Economically inactive, retired
Economically inactive, other

If some or all FRPs have the same economic activity, the HRP is the eldest of the FRPs. If some or all are the same age, the HRP is the first of the FRPs from the order in which they were listed on the questionnaire.
If a household is made up entirely of any combination of ungrouped individuals and other related families, the HRP is chosen from among all people in the household, using the same criteria used to chose between FRPs. Students at their non term-time address and short-term migrants cannot be the HRP.

Chief Income Earner – DEFINITION (ESOMAR)

The person in the household with the largest income, whether from employment, pensions, state benefits, investments or any other source.