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Geodemography

Table 1.

	China	U.S.
Largest Census Geographies	China total	U.S. total
	Province	State
	City	County
	County	Place (city)
		Census Tract
Smallest Census Geographies with complete data	Township	Block Group
Smallest Geographies – very limited data	1km grid*	Census Block

Note: 1km grid data is not reported by the China Census. It is an estimate produced by China Data Center, University of Michigan, U.S.

In the past, Census data was distributed in printed books and reports. The geographic boundaries were available as paper maps only. Fortunately, with the emergence of computers, electronic data formats, and Geographic Information Systems (GIS), census data and associated geographic boundaries became available in electronic format. The U.S. delivers Census data and boundaries in GIS formats, however, the Chinese government has never released any official GIS boundary files for the Chinese Census data.

The U.S. Census Bureau makes much of the U.S. Census data publicly available, and data for standard U.S. census geographies can be accessed at www.census.gov. Chinese 2000 census data (at province, county and township levels) is available for purchase through China Data Center of the University of Michigan at http://chinadatacenter.org/.

APPLICATIONS AND USES OF GEODEMOGRAPHICS
Information about people (demographics) and where they are located, is very important in many areas of research:

• Academic Research – Social, Demographic, Economic, etc.
• Government – Where should scarce resources be allocated?
• Environmental – What are the environmental impacts of population. What are the human and economic costs from natural disasters?
• Urban Planning – What are the needs of the community for housing, transportation, and other services?
• Business – Where are my best customers? What are their characteristics?

All of these endeavors need information about the population. For the purpose of this article, we will emphasize business applications.

BUSINESS APPLICATIONS OF GEODEMOGRAPHICS
To achieve their goals of increased sales, profit, and market share, businesses can make use of geographically-organized demographic information to improve decision-making:

• Site Location Analysis – Where should I open my next store? Which stores should be closed?
• Understand my Customers – Where do they live? How far will they travel to my store? What types of neighborhoods do they live in?
• Target Marketing – How can I communicate with my customers? Where should I advertise?
• Consumer Potential – How much potential exists in a trade area or market for my product?
• How can I find more customers? - Where do concentrations of people similar to my customers live?

Census data on age, income, household size, type of housing, race and ethnicity can be used to help understand patterns of purchasing behavior.

BUSINESS CENSUS DATA
Another type of information needed by businesses is data about other businesses. Not only can censuses collect information about people, they can be used to collect information about other things – including businesses. Economic censuses collect data about established businesses, their industry classification, size, etc. This data can be summarized (aggregated) to geographic levels, similar to those reported for the population censuses.

Business Census data can provide valuable insight into:

• Level of competition – How many competitors exist in a trade area?
• Availability of business services – For example, convenient access to an office supply store or access to shipping and transportation services.
• Consumer potential from persons employed in an area. – Often referred to as “daytime” population, people sometimes shop where they work, rather than where they live. Persons employed in a store’s trade area can be an important source of customers.

EXAMPLES - CHINESE AND U.S. SITE LOCATION ANALYSES USING DEMOGRAPHIC DATA –


Figure 1. The 2000 Population by Townships of Jiangxi Province, China

Figure 1 Displays Jiangxi Province, with townships represented by point symbols. The size of the symbol indicates the relative size of the population in the township, as shown in the legend. This map can help identify areas with larger concentrations of people – and greater numbers of potential customers.


Figure 2. Potential new site in XuZhou, China

Figure 2 shows a closer view of a potential site for a new business location. Buffers have been drawn around the location (one-half, one, and two km radii). Townships are shown with varying sizes, representing the 2000 population. Demographics can be summarized to the total trade area (radius), allowing for more objective comparisons among multiple sites.

EXAMPLE: SITE LOCATION ANALYSIS – UNITED STATES


Figure 3. One mile radius around New Store Location. U.S. 2000 Census Block Groups by Number of Households with Children.

Figure 3 displays the number of households with children in each neighborhood within the trade area. The darker areas have larger numbers of households with children.

To summarize the overall potential for the new site, Table 2 shows a report displaying demographic characteristics for persons residing within the radius, based on the underlying detailed Census data.

Table 2. Automated Report for radius trade area using Allocate Marketing Information System


Note that the data are reported in total for the radius, and charts, tables and text descriptions have been automatically generated by the marketing information system (DemographicsNow, which is discussed later in this article).

This type of information is used extensively by businesses in the U.S. in deciding where to place new business locations. With the availability of the upcoming Allocate China Marketing Information System, such analyses will be easy to perform for China, as well.

CONSUMER PROFILING
A powerful use of geodemographic analysis is to link a customer’s address to the census geography where that customer lives (geocoding). Once the census geography of the customer is known, the demographic characteristics of that census geography are attached to the customer. The assumption is made that people tend to live in areas with other people similar to themselves. This process provides a way to “estimate” the demographic characteristics of the customer.

From this process, measures and conclusions about customers can be calculated. For instance: