During the celebration of our nation’s independence, I started thinking about where it all started – Philadelphia. This historical city was the first capitol of the United States and the location for the signing of the Declaration of Independence in 1776 and the Constitution in 1787. What do we know about the people who live there today? How are they different from other Americans?
The population in the Philadelphia Core Based Statistical Area (CBSA) is 5,984,638, according to Esri. The median income in 2011 was $58,051 (compared to $50,227 nationally). Just 8.1% of the population identifies themselves as Hispanic, compared to 16.6% nationally. The population is 20.8% black, compared to 12.6% nationally.
I thought I’d compare the purchasing habits of a few items for the people who live in Philadelphia compared to the rest of the nation. The items I chose are beer and ale purchases at home, travel, and water sports. While these items aren’t uniquely American, they certainly are very popular – especially during our summer months.
In the Philadelphia CBSA, the average household spends $168.39 annually on beer and ale at home. This is slightly higher than the national average of $152.41. Of course, every neighborhood in Philadelphia is different – having different spending patterns, interests, and spending flexibility.
Average Beer and Ale Spending per HH by Zip Code
The zip code that spends the most on beer and ale at home in the Philadelphia area is 19035. The average per household in that zip code is $330.87. Not surprisingly, this is a very wealthy neighborhood. The median income in 2011 was $200,000. This group simply has more disposable income so they are able to spend more. The University of Pennsylvania is located in the 19104 zip code. It’s nice to know that they don’t spend too much and are less than both the national and Philadelphia average…their average annual spend per household is $102.75.
To better understand who spends the most on beer, we can use Tapestry Segmentation to classify consumers. Esri, a geographic information systems company which also does data analysis, developed the Tapestry Segmentation system that classifies US residential neighborhoods into 65 unique market segments based on socioeconomic and demographic characteristics. The tapestry group that spends the most is Top Rung. Residents of Top Rung neighborhoods are mature, married, highly educated, and wealthy. They spend, on average, $225 or more per year on beer at home. Residents of Laptops and Lattes also spend quite a bit. In 81% of the neighborhoods where that segment is dominant households spend $200 or more per year on beer and ale.
Travel is often a big part of American’s summer plans. How much people travel varies immensely depending on financial resources and interests. The average American household spends $1,877.61 per year on travel. In Philadelphia, the average household spends $2,212.52 per year on travel. Although the median income in Philadelphia is just slightly higher than the median income for the US, Philadelphians spend 20% more on travel. Clearly there are other factors involved. Where do these consumers live?
Average Travel Spend per HH by Zip Code
The zip code where households spend the most, on average, on travel is 19035. They spend $6,272.16, on average, per year. This is the same zip code that spends the most on beer. The dominant tapestry segment in that zip code is Top Rung. The zip code that spends the least on travel is 19133. Residents spend $666.30 per year on beer on average. The median income in this zip code is $14,766, so they are likely just not able to spend on travel due to their low income.
The tapestry segments that spend the most on travel, on average, are Top Rung, Connoisseurs, and Suburban Splendor. Residents of these segments spend, on average, $2,742.80 or more per year, which is 1.5 times the average American. Each of these tapestry segments have a median income of over $120,000 per year, so they all have significant means to travel.
One of the most popular activities during the summer is swimming. Obviously this is a great way to try to cool off from the oppressive heat – which is being felt all around the country this week. About 14.8% of Americans participate in swimming. Philadelphians participate a little more. They have an index of 107, meaning they are 7% more likely than the average American to participate in swimming. Although it can be quite cold in Philadelphia in the winter, residents find a way – or wait until the summer to cool off. Where do the swimming enthusiasts in Philadelphia live?
Likelihood of Swimming by Zip Code
The zip code in the Philadelphia CBSA with the highest swimming index is 18950. This is the zip code for Pt. Pleasant, NJ, which is a beach town (so that makes sense). The index in this zip code is 151 meaning a resident here is 1.51 times more likely than the average American to swim. It is clear from the map, the people who are likely to swim the most live near the center of Philadelphia (except for those who live right in the center). People who live more on the outskirts of the CBSA are more likely to be swimmers.
The most avid swimmers by tapestry segment is Laptops and Lattes. Neighborhoods where this segment is dominant have an index of 150 or higher meaning they are 1.5 times more likely to participate in swimming than the average American. Laptops and Lattes is primarily made up of affluent, educated, singles, many of which live with a roommate. There are several tapestry segments consisting of people who are not likely to swim. The tapestry segments City Commons, City Strivers, Family Foundations, Las Casas, Metro City Edge, Modest Income Homes, and Newest Residents have an index of 50 or less. This means residents in these neighborhoods are ½ as likely (or even less) to swim. Many of these segments are part of the Urbanization Principal Urban Centers II. This Urbanization group represents the aspiring populations of the country’s largest cities.
Why Does this Matter?
Understanding the interests of a local area can help businesses make decisions regarding product distribution, marketing, and more. Knowing that there are specific neighborhoods where people buy beer, travel products, and swim informs company strategies to target their audiences. It can even help businesses decide where to have a sale – or not to. In this example, the zip code 19035 is very affluent and already buys much more than average. They are going to buy anyways so sales may not be necessary, but having available product there is key.