Johannesburg, 02 September 2014
I would like to thank you for publishing an interesting article entitled ‘Changing consumers mean changes in LSMs’ on 1 September.
The gist of the article was that Lifestyle Standards Measures (LSMs) and Target Group Index’s (TGI’s) Socio Economic Levels (SELs), due to their demographic nature, have limited use. I think most people would agree with this, and the debate should be turned toward psychographic segmentation.
However, there were some inaccuracies in relation to TGI’s SELs that I would like to rectify. The article states: “Similarly, Hollis says that SELs are only effective in Europe and America because their populations are largely homogenous. ‘That is not the case in South Africa. SELs also measure the top end of the market and neglect the middle class,’ she says.”
I would like to clarify that TGI’s SELs are not only effective in Europe and American as a social classification system. SELs have been successfully implemented by marketers in Asia, South America, and Africa. Countries that use TGI SEL’s include Chile, Colombia, Argentina, Peru, Puerto Rico, Brazil, Ecuador, Russia, India, China, and of course South Africa.
We disagree that SELs only work for homogenous populations. Europe and America are not highly homogenous populations, if they were no segmentation would be required.
SEL’s don’t neglect the ‘middle class’. The variables used to create the SELs were chosen for their discriminatory power across the entire market. TGI best practice dictates that SEL’s are used in tandem with psychographic data such as life values, hobbies, interests, and category specific attitudes to add depth and discrimination to any target.
CEO and founder of Ask Afrika
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