Targeting consumers based on their preferences and behavior offers the promise of turning marketers into armchair psychologists. Get it right, can you can give people precisely what they want, precisely when they need it. And as devices and data proliferate, smart marketing segmentation and behavioral targeting are taking on many forms.
Here are 13 ways brands and marketers can use behavioral targeting and segmentation to build smarter, more cost-effective marketing campaigns, with examples and data to back it up.
There are different types of characteristics by which to segment your audience. This could include by platform (like your social media audience vs your email audience), demographics (like age, location, and gender), psychographics (like values and lifestyle), and more.
But as you start to gain traction with your marketing campaigns, you can then perform the best segmentation of all: behavioral segmentation.
Behavioral segmentation uses data from the ways your audience members engage with your business—whether that’s leads interacting with your marketing campaigns or customers interacting with your products—to identify the best ways to proceed with them in their journey.
This could be how they behave on search engines or on your website; how they engage with your ads, landing pages, and emails; how frequently they purchase, and the list goes on.
For example, you may identify particular times of the day, week, or month when sales slow down and offer discounts during that period. Or you might reward frequent or long-time customers to build customer loyalty.
As mentioned above, dividing your target audience into smaller segments allows you to identify the different paths your leads and customers take and provide the most relevant offers and messaging for those paths. Here are 13 ways to do that so you can better allocate your budget, obtain more customers, and improve retention.
Perhaps the most basic form of behavioral targeting is remarketing, which allows marketers to capitalize on consumers’ prior behavior on your site.
In fact, Natalie Lesyk, marketing manager at Ning.com, called remarketing “the core and the greatest instrument” of behavioral marketing. You can build a remarketing audience tailored to specific behaviors, and then use remarketing ads to show users exactly what they viewed on your site or related popular products that other buyers also purchased.
This is the strategy used by Simon Thalmann, digital marketing manager at Kellogg Community College. The college targets users who have visited specific pages of its website with specific ads related to what they viewed.
“So, for example, if a user visits our registration page, they may later see registration-related messaging in ads served on various websites, in apps or social networks that they visit,” he said.
Dell is another good example. In a case study, the brand said its website had plenty of visitors, but many were leaving without buying anything. As a result, it wanted to find out which products each visitor was interested in so it could cater appropriate messaging to these specific consumers and encourage the sale.
Dell analyzed visit history and created remarketing ads featuring the products the customers viewed, searched for or put in their carts.
Dell said the result was higher click-through rates, conversion rates and ROI, including online ads with a 70% higher CTR and triple the conversion rate.
And then there’s the case of travel site Orbitz, which reportedly catered its search results based on whether consumers were using Macs or PCs. The bad news for Mac users is that Orbitz served more expensive hotels to them – as a result of research that showed Mac users spend up to 30% more on travel and are 40% more likely to book higher rated hotels! (Presumably, since Macs cost more than PCs, their user base is more affluent.)
An Orbitz rep confirmed the experiment, saying it wasn’t displaying different prices for the same rooms, and users can still rank hotels by price to see lower cost options.
An experiment by the Wall Street Journal determined hotel rooms were about 11% costlier on the first page of results for Mac users, but it’s unclear whether the move drove revenue for Orbitz and if this segmentation strategy is still in practice.
Naturally, learning more about your consumers themselves, in addition to their online behavior helps marketers achieve the holy grail of right person/right device/right moment. Some call this combined study of people’s attitudes and interests with demographic data psychographics, and it can be amazingly effective.
“Online behavior, especially when combined with other parameters like geography, can produce laser-focused targeting, thus better advertising campaign and content marketing results,” according to Stella Mikraki, head of marketing at email marketing service provider Moosend.
At international gift basket delivery company GiftBasketsOverseas.com, for example, this means targeting customers who have previously sent gifts to a specific country.
“We target them with an email campaign to remind them that the major national holiday is coming soon and that they have exactly enough time to send greetings,” said Natasha Kvitka, digital marketing strategist.
Behavioral targeting can also help brands and marketers hone their customer profiles.
“Marketers can use behavioral targeting to create a pool of tailored audiences,” said Tom Caulton, digital marketing executive and SEO consultant at digital growth agency Dijitul. “Doing this allows you to create multiple campaigns with different personas in mind. From my experience, brands often succeed where others don’t when they give customers branded content they believe is just for them.”
Kristie Forsman, director of digital marketing at real estate brokerage franchise network Berkshire Hathaway HomeServices, agrees. She says combining behavioral targeting with interest and demographic targeting to create audiences can help brands design the most effective creative for each audience.
For example, new homeowners are not likely to be interested in selling the homes they just purchased. Armed with that knowledge, a real estate firm can exclude these homeowners when looking for targets for a campaign promoting home sales.
“This will help increase the relevancy of your ads, which will result in higher click-through rates and engagements,” she added.
For more help in this area, check out these non-annoying, non-generic customer engagement strategies.
In another case study, online travel agency Zuji said it, like Dell above, had plenty of visitors who did not convert, and its display ads were not as effective as it wanted them to be. That’s why Zuji decided to try out dynamic content optimization and remarketing to encourage consumers to return with personalized recommendations based on previous searches.
Zuji actually bid higher on those ads in order to show content to consumers who were more likely to make purchases. As a result of this budget allocation, Zuji saw online bookings go up 14%, and ROI was up 100X.
Behavioral targeting can also help brands find entirely new customers. For example, you can target consumers who have openly declared themselves fans of competitors.
But it’s not just, say, Burger King appealing to fans of McDonald’s or Pepsi to Coke’s. Marketers can also introduce alternative brands by targeting consumers who purchase products related to yours, said Jacqueline Ryan, manager of integrated marketing at organic candy company YumEarth.
For example, a brand that sells milk can target people who love cookies, she added.
Think about cohorts when determining your targeting strategy. People who are into fitness might also be into healthy food.
Some of Facebook’s many, many targeting options
When low-cost airline AirAsia wanted to restore consumer confidence after a 2014 crash, it turned to Facebook.
AirAsia used short videos, but it split its audience into segments and targeted each with custom video creative. These segments included:
The airline used Facebook’s reach and frequency tool to control the number of times consumers saw the ads over a four-week period. AirAsia also used its own customer data along with Facebook’s Custom Audiences tool to target frequent fliers and consumers who had searched for particular cities but did not buy tickets and to deliver custom ads. This alone yielded a 30X return on ad spend.
AirAsia also used Facebook’s Lookalike Audiences tool to find people similar to existing customers and to deliver ads that promoted its values as well as its destinations. This resulted in a 58X return on ad spend.
On the other side of the coin, segmentation means brands can avoid wasting money on personas who have expressed opinions indicating they will never buy their products.
“You are not going to want to target vegans with a product that tests on animals,” YumEarth’s Ryan said.
Forsman agreed behavioral targeting gives brands the opportunity to not only find new customers, but to omit people who may not benefit from their offering. Why waste money on people that won’t convert?
On-site behavior can also inform promotions.
According to Dimira Teneva, content manager of e-commerce analytics platform Metrilo, brands can use information like the products or categories consumers like, browse and shop from to create custom offers for individuals and segments with similar behavior.
“What products people looked at while browsing a store and what they ended up buying is a goldmine of info for bundle offers and category arrangement,” Teneva said. “It tells the sellers what products are similar in the customer’s mind, what goes well together, what serves them the same purpose and so on.”
Examining the customer journey to a given website can also help marketers find new advertising opportunities.
“Where is your web traffic coming from? If there’s a certain social media platform that regularly drives traffic to a certain page, maybe you should consider advertising there, or maybe create a custom landing page optimized to greet visitors from that site,” Thalmann said.
“Do visitors from some sites convert or purchase more than visitors from another site? Do they spend more time on your site than others? All of these insights can help marketers optimize their user experiences to help them achieve their goals.”
Similarly, Thalmann said looking into how consumers leave your website can also be valuable.
“How much time do users spend on your website or landing pages? Do they visit just one page and leave, or do they visit many? What does their page path indicate they may be looking for on your site? Were they able to find it?” he asked.
“Even small changes to your website – changing the size or color of a purchase button, moving a contact form higher to make it more visible, etc. – can have a big impact on how users behave on your site and whether or not they convert in the way you want them to…It doesn’t matter how high your click-through rate is or how low your cost-per-click is if users can’t navigate the page on the other end of the click well enough to actually make a purchase.”
Doreen Brown, head of digital at digital marketing agency Digital Visibility Group agreed that analyzing dwell time allows brands to see whether users are finding what they need or if they are bouncing off and going elsewhere.
“If there is a gap in what is being described on your site, you can use behavioral targeting to develop a content strategy, providing both search engines and users the information they require,” she added.
That means tapping into Google Analytics to look at page views, average time on page and bounce rate. Brown said the pages with a bounce rate over 50% should be reviewed.
“By doing this, users are able to find more of the information they need,” which naturally reduces the chance of them going elsewhere, she added.
Brands should also consider when exactly traffic is highest and time their messaging accordingly to maximize visibility, Thalmann said.
“Analyze the visiting/buying time of your customers and you’ll get the pattern of their online activity during the day,” Kvitka added. “Chances are high that the open rate of your email campaigns sent in that timeframe will be higher, too, and social media updates will experience more engagement.”
In another example, lifecycle engagement platform Appboy recently partnered with location data company PlaceIQ to increase mobile engagement for youth-focused retail brand Urban Outfitters by using real-world behavior to support smarter delivery of in-app messages.
Appboy and PlaceIQ said they were able to help Urban Outfitters better contextualize its marketing messaging and, as a result, Urban Outfitters boosted conversions by 75% and increased related revenue by 146%.
“Location-aware insights have become a great enabler of decisions across media, marketing and business functions, as well as a core component in driving benefits like significant visitation lift and purchases at brick and mortar locations,” said Duncan McCall, CEO of PlaceIQ, in a statement. “Insights from location data can also be a powerful driver for online retail sales as well. By using location data for audience insights, Urban Outfitters was able to craft and deliver a resonant campaign that resulted in tangible sales results.”
In a release, the platforms said the rise of mobile has made it easier to deliver campaigns to customers based on in-app and web preferences, allowing marketers to better understand and engage users. And by partnering with Appboy and PlaceIQ, Urban Outfitters was able to develop a full-scale campaign that included:
According to Andrew Rauch, senior director of global digital marketing at Urban Outfitters, in a statement. “Effectively communicating with users through this location-specific marketing led to a 146% increase in campaign revenue.”
Lisa Smith is a freelance writer who has covered the digital marketing industry for more than a decade.
See other posts by Lisa Smith
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