Customer Knowledge

Customer Insight

© 2012 Grant Thornton UK LLP. All rights reserved.

About Customer Insight

• Customer Insight is a research and intelligence service, designed to help users achieve a better understanding of citizens, customers and communities. With this online system you will have access to a geodemographic classification - the Output Area Classification - covering the whole of the country, together with local data estimates and a range of other resources.

• Linked to our interactive toolkit, you will be able to create a range of graphical outputs that bring OAC to life, telling a story of local customers and communities.

• Customer Insight will not only help in meeting your customer insight needs, but will also provide a resource for analysing the make-up of citizens and communities across Britain.


Geodemographics

• Geodemographics is widely defined as the ‘analysis of people by where they live’. The term has come into common use to describe the classification of small areas and the use of geography to help draw general conclusions about the characteristics and behaviours of the people who live in them.

• The underlying premise is that similar people live in similar places, do similar things and have similar lifestyles - in other words, that ‘birds of a feather flock together’.

• Geodemographics is often referred to as neighbourhood classification and the process involved is also called segmentation.


The Output Area Classification

• The Output Area Classification is the only geodemographic tool accredited as a National Statistic. OAC distils key results from the Census for the whole of the UK at output area (OA) level. There are over 223,000 output areas across the UK.

• One frequently asked question is whether OAC is a poorer analysis tool because it is based on output areas as opposed to postcode or household. However, research shows that output area level tools are more robust because they need to be refreshed less often than those at lower spatial levels. In effect, small changes in population will not alter in the short or medium term how an area should be classified because the average characteristics of residents will remain the same at the aggregate level .


The OAC classificationSuper groups Groups Sub groups

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7 Constrained city dwellers

7a Challenged Diversity

7b Constrained Flat Dwellers

7c White Communities

7d Ageing City Dwellers

8 Hard-pressed living 8a Industrous Communities8b Challenged Terraced Workers8c Hard Pressed Ageing Workers

8d Migration and Churn

5 Urbanites 5a Urban Professionals and Families

5b Ageing Urban Living

6 Suburbanites 6a Suburban Achievers

6b Semi-Detached Suburbia

3 Ethnicity central 3a Ethnic Family Life3b Endeavouring Ethnic Mix

3c Ethnic Dynamics3d Aspirational Techies

4 Multicultural metropolitans

4a Rented Family Living

4b Challenged Asian Terraces4c Asian Traits

1 Rural Residents 1a Farming Communities

1b Rural Tenants

1c Ageing Rural Dwellers

2 Cosmopolitans 2a Students Around Campus

2b Inner City Students2c Comfortable Cosmopolitan

2d Aspiring and Affluent

Three Tiers:• 8 Supergroups

• 26 Groups

• 76 Subgroups

Pen portraits:• demographic structure• household composition• housing• socio-economic characteristics• employment patterns


Visualising OAC

• Customer Knowledge brings the Output Area Classification (OAC) to life, allowing a quick and easy analysis of the make-up of local communities

• Bar charts show the proportion of the population within the different OAC groups. They also provide a ‘DNA’ profile of individual places

• Maps display the OAC classification – Supergroups, Groups, Subgroups – of individual Census Output Areas.

• The profiling application provides a graphical presentation of the make-up of an area, in terms of key groups, and identifies statistical nearest neighbours.


Local data estimates

The ONS is coding its sample surveys, using the OAC classification. The Expenditure and Food Survey is already available, providing income estimates and many categories of household expenditure. Other surveys which have also been OAC coded include the British Household Panel Survey and the British Population Survey.

Customer Knowledge includes a range of Local Data Estimates - at an Output Area level - created by modelling the findings of these household surveys using OAC.


Local data estimates - examples

• Expenditure and Food Survey– Total household income– Household income from different sources– Household income from benefits– Household expenditure on pensions, life insurance, savings, investment– Household expenditure on food, transport and communications, cultural

activities, fuel

• British Population Survey– Household income– Internet access– Demographics– Qualifications– Economic activity– Home tenure


Applications

Shaping local strategies - Information on customers, citizens and communities can be used to inform decisions and

to input into policy or scrutiny reviewsAllocating resources

- Resources can be prioritised to areas of greatest need, such as targeting at neighbourhood level, or to identify vulnerable or underserved groups.

Managing performance - Understanding customers’ needs and experiences can help you understand where

services are performing well or badly as well as what you might want to do about it.Marketing services more effectively

- Understanding different groups of customers makes it possible to market services more effectively, such as being able to encourage take-up of services.

Changing behaviours - Social marketing techniques that employ a deep understanding of the customer to

provide information, products and services can be used to change people’s behaviour.Improving service design

- Knowing what customers want and need from a service can help identify areas of weakness and feed into the design of services that meet their needs and preferences.

Source: Local Government Improvement and Development Agency


Benefits of OAC

• Freely available (no annual licence fees for the classification) • National Statistics accredited • Classifies every Census Output Area across GB (over 218,000,

with an average size of 120 households) into 8 Supergroups, 26 Groups, and 76 Subgroups

• Open source – the data and methods used are completely transparent

• Office for National Statistics surveys are now being coded to OAC, which expands the possible data that can be modelled at Census Output Area level.

• OAC is a common language for understanding citizens, customers and communities


FAQs

• OAC is based on the 2001 Census. Doesn’t this mean it is already out of date?– Output area level classifications are more robust, because they need to be

refreshed less frequently than those at lower spatial levels. • Why is OAC only available at an Output Area level?

– Research shows that output area level tools are more robust because they need to be refreshed less often than those at lower spatial levels. In effect, small changes in population will not alter in the short or medium term how an area should be classified.

• How does OAC compare to other commercial classification systems?– Comparative research shows that there is little to choose between the

different classifications, in terms of their descriptive and predictive qualities. • What national data sets are becoming available based on OAC?

– A number of ONS surveys have now been tagged with the OAC classification. Other surveys which have been tagged, enabling the generation of local datasets, include the British Population Survey.


Training

• We offer training courses, designed to help you get the most of Customer Knowledge.

• Introduction to OAC– This course provides an introduction to OAC, showing how it can help you

to better understand your citizens, customers and communities. We demonstrate how to profile your area using the visualisation tools contained in Customer Knowledge and present case studies and practical examples of how to get the most out of the system.

• Analysing Survey Data using OAC– This course demonstrates techniques for matching your own customer or

survey data to OAC and how to produce your own local data estimates.


Resources and support

We offer a range of help and support, designed to ensure you get the most out of Customer Knowledge

• OAC online– OAC is available online, covering the whole of Great Britain, linked to toolkits for

analysing and visualising the classification• Group descriptions

– We provide full descriptions of the 8 Supergroups, 26 Groups and 76 Sub Groups• Access to technical papers

– We provide links to technical papers from ONS and other sources• User guides

– User guides show you how to analyse OAC using the various toolkits• OAC coder

– We provide access to an OAC Coder, allowing you to identify the classification for any postcode

• Local Data estimates– As part of the Customer Knowledge service, we provide access to a wide range of Local

Data Estimates, modelled on ONS and other major household surveys.• Advice and support

– Our staff are always on hand to provide help and support

Technology

Customer Knowledge