Definition
These are the income thresholds that divide all households in a specific area into five equal groups (quintiles), each representing 20% of the households. For example, the 20th percentile income, 40th percentile, 60th percentile, and 80th percentile.
Why It Matters
Provides a clear understanding of income distribution and inequality within a population, rather than just averages. It shows the income ranges for different segments of the economic spectrum, from the lowest-earning 20% to the highest-earning 20%.
Specific Relevance for Professionals:
Marketers
Essential for stratified market segmentation. It allows marketers to understand the income range of the top 20% of earners, the middle 20-40%, etc., tailoring product lines, pricing, and messaging for specific economic tiers of consumers.
Researchers
Fundamental for studying income inequality, wealth distribution, and economic mobility. It enables detailed analysis of the disparities between different income strata and the impact of economic changes on various segments of society.
Consultants
Crucial for advising clients on market entry strategies for products targeting specific income brackets (e.g., budget-friendly, mass-market, or luxury). It helps assess the size and characteristics of different economic tiers within a target region.
Public Policy Workers
Vital for analyzing income inequality, designing progressive tax policies, and developing targeted social assistance programs. It helps identify the income characteristics of different segments of the population for policy intervention aimed at economic equity.
