Demographics:
Used to help companies decide on a target audience for a particular product, demographics looks at things such as age, gender and social class to decide how and where to advertise and who to aim their product(s) at. An example of this is if a girl band (e.g. The Saturdays) were releasing an new album, it would be aimed at younger girls (10- 18) and would be advertised in a girly type of magazine or a weekly gossip magazine (e.g. OK!)
Psychographics:
This looks deeper into the consumer as an individual to help give the creator of a particular product a better understanding of the people buying their product(s) thus helping increase sales and profit. Some examples of what psychographics looks at are the activities the person partakes in, their views and behaviour and their interests and opinions.