We present photometric analysis and follow-up spectroscopy for a population of extremely red stellar objects extracted from the point-source catalogue of the Isaac Newton Telescope (INT) Photometric Hα Survey (IPHAS) of the northern Galactic plane. The vast majority of these objects have no previous identification. Analysis of optical, near- and mid-infrared photometry reveals that they are mostly highly reddened asymptotic giant branch stars, with significant levels of circumstellar material. We show that the distribution of these objects traces galactic extinction, their highly reddened colours being a product of both interstellar and circumstellar reddening. This is the first time that such a large sample of evolved low-mass stars has been detected in the visual and allows optical counterparts to be associated with sources from recent infrared surveys. Follow-up spectroscopy on some of the most interesting objects in the sample has found significant numbers of S-type stars which can be clearly separated from oxygen-rich objects in the IPHAS colour-colour diagram. We show that this is due to the positions of different molecular bands relative to the narrow-band Hα filter used for IPHAS observations. The IPHAS (r' - Hα) colour offers a valuable diagnostic for identifying S-type stars. A selection method for identifying S-type stars in the Galactic plane is briefly discussed and we estimate that over a thousand new objects of this type may be discovered, potentially doubling the number of known objects in this short but important evolutionary phase.