They Know Where You Live And How You Buy

You're 35 years old. The price tag on your suits shows that you're a success. You drive a Volvo. You know your way around the olive-oil section of the store, buy fresh-ground coffee, and go on scuba-diving trips. You're living out your own, individual version of the good life in the suburbs. You're unique--not some demographic clich .

Wrong. You're a prime example of "Kids & Cul-de-Sacs," one of 22 new consumer groups in PRIZM, Claritas Inc.'s demographic taxonomy of Americans by postal Zip Code. For the past 20 years, PRIZM (Potential Rating Index by Zip Market) has been among marketers' favorite tools for finding consumers. Restaurant chains, banks, and stores use the Alexandria (Va.) company's PRIZM to pinpoint the best locations for new outlets. Direct marketers tap it to target mailings. Ad agencies comb PRIZM for insights on consumers. Often, they find surprises: "Executive Suites" has a lot of Spam fans; the blue-collar households mf "Rural Industria" are a good market for pagers; and "Golden Ponds" seniors love theme parks.

SCANNER WARS. The new upgrade, which brings the total number of consumer segments in PRIZM to 62, is the latest sign of how the nation's increasing ethnic and economic complexity is changing consumer marketing. Old PRIZM standbys, such as "Furs & Station Wagons" and "Shotguns & Pickups"--PRIZM is as well-known for its fanciful names as its insights--are being joined by new clusters. "American Dreams" reflects new waves of immigrants. "Kids & Cul-de-Sacs" points to the new migration to the suburbs. "Young Literati" taps Generation X. There's even a place for aging hippies--"New Ecotopia." Behind the cutesy names are important trends, Claritas executives say. "The goal," notes David Miller, 43, the quiet, lanky statistician behind PRIZM, "is get-ting the right message to the right person."

The new upgrade, which will debut in February, is also the latest volley in marketing's information wars. The number of companies keeping data bases of

individual consumers has exploded. Supermarket checkout scanners, meanwhile, are enabling legions of marketers to track how their products really fare on the ground. Some say that leaves PRIZM--which lumps people into groups--at a disadvantage. "The future lies with technologies that count real people and actual purchases," says Laurel Cutler, worldwide director of marketing planning for ad agency Foote, Cone & Belding Communications Inc.

Demand for information has been particularly feverish in this sluggish economic recovery. In many categories, marketers can increase sales only by capturing market share. Good research is a competitive advantage, says Cutler. Claritas, which had 1993 sales of $35 million and is a division of the Dutch company VNU, can't afford to fall behind.

PRIZM is founded on the notion that "birds of a feather flock together." The idea is that people who live in the same neighborhood tend to buy the same types of things. Jonathan Robbin, who designed the original PRIZM data base, broke U.S. Census Bureau data into Zip Codes and analyzed each for social rank, mobility, ethnicity, family life cycle, and housing. The Census data are supplemented with market-research surveys and other statistics from suppliers such as A.C. Nielsen Co. and information from 1,600 municipal and regional agencies. The current version of PRIZM segments America not only by Zip Codes but by block tracts and Zip-plus-four as well. The most expensive model, including mapping software, costs more than $100,000 a year to license. But reports go for as little as $99.

VIBE APPEAL. Marketers in a broad range of industries are ponying up. Premier Bank in Baton Rouge, La., merges PRIZM with its internal data base to find neighborhoods with lots of households that match the traits of its best customers. Ad agency Ammirati & Puris Inc. combined PRIZM with other research to create MasterCard's "Smart Money" ads.

Time Inc. Ventures used it to get its new urban-culture magazine VIBE over a hump. Advertisers were convinced VIBE was just for inner-city kids. PRIZM showed it also appealed to white-collar "Young Influentials" and middle-aged "Money & Brains." The result: ad buys from vodka and consumer-electronics marketers.

Ultimately, that's where the consumer-research wars will be won: sales. In these tough times, figures Claritas, what marketer wouldn't be piqued by the notion that those blas "Young Literati" buy lots of Cheerios?

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