In this course, we are going to talk about demographic reports. Determining the location of your new practice is very important, and demographic reports and demographic discussions have a significant role in the success of a start up. I’m Sheila Hayes a New Business Advisor at Williams Group. Let’s get started.
I will begin by giving you background into the reports. I will walk through parts of an actual report. I will discuss the attractiveness of the area. Lastly, I will talk about how you use can the information.
As you begin your search for the location of your new practice, you will want to learn as much information as you can about the area or areas of interest. One tool that will assist you in your research and knowledge about an area is a Demographic Report. The Demographic Report provided to you will give you so much valuable insight into the attractiveness of a given geography.
What is demographics? Demographics is the study of people. It’s that simple! The study of people, and you are in the business to serve people – your patients! It’s simple, it's simply defined, but it’s very important.
The demographic reports are the statistical study of people and their characteristics as well as information on the demographic trending—the insight into the changes and shifts of a given population. The report includes an aerial map, thematic map and various reports highlighting demographic trends, segmentation data, and consumer expenditures. The report uses current and future looking data.
We then pull information from this lengthy report and create a snapshot summary report. The snapshot summary report summarizes these main areas for you – Estimated Population Growth, Household Income, Target Demographic, Unemployment Rate, and Consumer Spending – and then benchmarks them against United States averages.
Now that you have some understanding of the background of demographic reports, let’s take a look at actual reports, using an address in Lincoln, NE, the city where Williams Group home office is located.
Let’s begin by looking at full Demographic Report. Here you will see our address of interest, represented by the pinpoint or star, showing the area around a 1, 3, and 5-mile radius.
You are now viewing a Thematic map of the household incomes with the color-coded legend representing the household income. You will see additional income data a bit further into the report.
The top section of page 2 of the big report shows the total population of this area in 1, 3, and 5 mile radius.
It's important to understand the age population of your demographic or location.
The largest age population represented in this area is age 5-14, with 16.4% of the population within one mile of this location of that age group.
The target market for an optometry practice is females between the ages of 25-54, and all of those segments are represented well in this report. This is a demographic of young families!
I will also point out that the second largest age group represented is the 55-64 year old demographic– with 14.6% of the population within 1 mile. Bifocal contact lenses, dry eye management, perhaps more medical visits? Does this align with your new practice plan? This is definitely a secondary, or sub target market in this area.
This section of the report provides data on the average household income as well as breaking down the percentage of households that are within each of the incremental categories. This area is one of high household earners, with incomes over $150,000 being the largest segment represented.
This section gives insight into the shifts and trends of the population. How much or little is an area growing? We have historical data and we see future predicted data. The report utilizes Census Data.
Now let’s take a look at the Snapshot Report.
As I mentioned earlier, the snapshot report is an overview of the main areas, with benchmarks against US averages.
For our practice on Hidcote Drive in Lincoln, NE, we see very high growth and estimated population growth. Look at the crazy high growth 16.6% growth within one mile!
We see the high household incomes. When benchmarked against US average, those numbers are impressively high.
As we view the target market section, the average ages are almost in alignment with our primary target market. The numbers, in fact, skew a bit low with all of those 5-14 year olds that we saw represented in the full report.
At the time of the report, the United States unemployment rate was 6.7%, and the average in Lincoln, NE was far below.
The last section shows the consumer spending on healthcare, which was also above the national average, which is not surprising with the high incomes of this area.
These reports will help you gain knowledge of the demographic and psychographics about your area. This information will be useful as you write your Business Plan. Additionally, you will use this knowledge as you establish your marketing plan and purchase your initial frame inventory, as the data allows you to answer the question, “Who is my patient and what type of patient should I be targeting?”
After you have reviewed this information, I look forward to reviewing and having the conversation with you about your own demographic area.