Savvy marketers know that it's ineffective to deliver the same marketing content to everyone. After all, each consumer has their own favorite color, required size and frequently purchased brand. The marketing campaigns that resonate most with consumers use different approaches for different audiences. That's where behavioral targeting comes in.
With the right technology in place, marketers can use behavioral targeting to enhance the customer experience and deliver results. In this guide, you'll discover what behavioral targeting is, what to look out for in a behavioral targeting solution, and how to get started.
What is behavioral targeting?
Behavioral targeting allows marketers to effectively deliver relevant marketing messages to customers based on their behavior. Data from across channels is coordinated to segment customers according to their interests and stage in the customer lifecycle or buying funnel. These segments can be used to deliver highly relevant content to shoppers at the moment they are most likely to convert.
Behavioral marketing is one element of a successful eCommerce personalization strategy. It can be used to boost ROI from bulk and triggered emails, across your website, and in social media advertising.
Note that behavioral targeting is distinct from contextual targeting, which displays content based on relevance to the web page currently being viewed - such as placing an ad for tableware on a recipe site. It is also much more effective than demographic targeting: rather than grouping shoppers together in broad categories (such as age or gender), actual behavior is used to establish a shopper's interests and stage in the purchase journey.
Benefits of behavioral targeting
Consumers have the whole internet at their fingertips. That’s a lot of choice, and a lot of marketing content! Marketers can stand out by delivering messaging that addresses customers’ individual needs and desires. It doesn’t cut it to call customers by their first name in emails: one in three consumers don’t care. Here are six benefits of behavioral targeting for customers and marketers.
How behavioral targeting benefits customers
1. Mimic the in-store personal experience
In brick and mortar stores, sales clerks convert customers overwhelmed with choice by pointing them in the direction of the most popular items and help out shoppers who have balked at a hefty price tag by showing them the latest discounted items. To translate this level of personalization over to eCommerce, marketers can use the wealth of behavioral data available at their fingertips.
2. Reduce the cognitive load on the customer
By showing customers what they want, when they want it, you reduce the mental effort needed to make a decision.
3. Help shoppers discover new products they should like
When you get to know a shoppers' preferences and lifecycle stage, you can help them find the latest products that meet their needs.
How behavioral targeting helps marketers
1. More cost-effective marketing
Retaining existing customers is more cost-effective than attracting new ones. Of course, this doesn't mean you shouldn't put any effort into tempting new shoppers. But by getting to know your existing customer base through behavioral data, you can identify your most profitable segments and adopt the most effective strategies to keep them coming back for more.
2. Increased click throughs
By serving up the most valuable content to customers at the moment when they need it, you will increase the ROI from digital marketing efforts. Retailers don't have to waste resources on generic marketing communications that miss the mark.
3. Earn customers’ loyalty
By providing consumers with content that truly matches their interests and lifecycle stage, you create longer relationships and turn new customers into loyal returners.
How behavioral targeting works
Types of data collected
Effective behavioral targeting requires collecting and coordinating large amounts of behavioral data in real time. This behavioral data includes products browsed, carted products, content viewed, search keywords and visitor frequency, as well as transactional data such as average order value and purchase history.
How data is tracked
Behavioral data can be pulled from the main channels where customers interact with your brand:
Aim to collect data from individual users' web browsing behavior even when they haven't identified themselves in this session. Cookies give you ability to personalize the customer experience for online users based on the visitor's current session, allowing you to pick up information and preferences as they browse web pages or take other actions, all without needing the visitor's identity. Once they have clicked on an email link or, in the case of registered users, logged into their customer account, the collected behavioral data can be tied back to their history. Identifying more users is a key step to increasing revenue from behavioral marketing.
It's worth noting that even without permanent cookies, you can use personification based on contextual data and AI techniques to personify the experience of visitors who have not yet been identified.
Mobile & app
If feasable, marketers should access in-app data and correlate it with desktop and mobile browsing behavior to build a holistic view of customers.
Data from your email marketing system is crucial to providing a personalized experience, since email addresses act as consumers' digital I.D. For true cross-channel personalization, data should flow from your ecommerce system to your ESP and vice versa. Email data can be used to build a complete picture of customer preferences, while website behavior allows you to send more targeted email communications.
Collect information about products clicked, the types of emails opened, and the time of day the subscriber opens your emails.
If you have a system to collect customer data from your offline stores, you can join this up with online data to meet your ultimate goal: a holistic view of the customer. This might include their store preference, or the types of items customers buy offline versus online.
This data can be used to segment customers into lists based on their behavior. These might include new visitors, lapsed shoppers, disengaged customers, high-spenders, and a range of other segments.
Advanced personalization solutions will also allow you to track customers' real-time preferences for factors like color, brand and style, allowing for more sophisticated behavioral segments.
Once segments are set up, they can be used to target shoppers with the most relevant website content, and select which triggered emails customers should receive. Lists can be exported to your ESP for use in bulk emails, and used to retarget customers on other channels such as tailored advertising campaigns on social media and Google AdWords.
Examples of behavioral targeting
We've seen that behavioral targeting opens up fantastic opportunities for marketers in multiple ways. Now let's look at the many ways segmentation can be used to drive results in practice. Here are some key targeted audiences you should be tracking, and the content that is likely to deliver the best results.
1. Frequent browsers (who haven’t made a purchase)
These highly engaged potential customers can be identified by the number of pages viewed, and frequency of visits over a given time period. Turn these browsers into buyers by showing them personalized offers based on the products and categories they are most interested in.
2. Loyal customers
It can cost five times more to attract a new customer than it does to retain an existing one. So keeping the customers who shop frequently with you happy should be top of your priority list.
Create a segment of frequent buyers and reward them for their loyalty with exclusive perks. Our research shows that almost 1 in 3 consumers (29%) want retailers they shop with regularly to offer early access to sales or limited editions, so this could be a good place to start for your loyal customer segment.
Glasses Direct treats their loyal customers to an exclusive early access 30% discount sale.
3. Lapsed customers
These are customers who have shopped with you a certain number of times but haven't done so in a while. Win back lapsed shoppers by reminding them what they like most about your brand, based on their past behavior. Let them know they are a valued customer by telling them about new products they might be interested in.
4. High spenders
Data from past orders can identify customers who tend to spend more than average. Nudge these customers towards a conversion with recommendations for your higher margin products from their favorite categories.
5. Shoppers who browsed a product that has dropped in price
Sometimes, potential customers won't quite get as far as completing a purchase because they were deterred by the price of a product. Segment this audience and send triggered price drop alerts when items they've browsed have been discounted. This provides extra encouragement for price-conscious shoppers and increases loyalty to your brand. With 1 in 4 consumers stating they want retailers to send them price drop alerts and sales lifts for price drop emails averaging 3%, this is a segment worth targeting.
Country Attire adds tempting recommendations to their price drop emails, encouraging customers to not only fill their basket with the featured product, but also shop for other items that have dropped in price.
6. Customers who need a refill
Target customers who bought products that need to be replenished, such as cosmetics, health supplements and consumable goods.
Send this segment timely emails reminding them to refill their stock, encouraging them to make a repeat purchase. Boost the efficacy of these emails by including personalized product recommendations in case the shopper is interested in alternatives to the original item. Almost 1 in 4 consumers aged 16-34 (24%) want retailers to send replenishment reminders, making this a worthwhile segment to target.
Viovet reminds customers who purchased a particular product that it’s time to re-purchase and recommends their own-brand product as a cost effective alternative.
7. Customers who browsed an out-of-stock product
When a customer encounters an out-of-stock product, this can harm your reputation and send shoppers to your competitors.
1 in 4 consumers want retailers to send them back-in-stock alerts, so try turning an out-of-stock product into a positive interaction by triggering an automatic back-in-stock email once the browsed product has been restocked.
In this example, Toolstop includes big bold product imagery to remind customers of the item they were interested in, along with a product review.
8. Customer preferences
Online retailers can get more out of marketing by targeting customers based on brand preferences. For example, if data shows that a group of customers is very loyal to a particular smartphone brand, they are likely to engage with information about new products from that brand.
Marketers increasingly have access to granular data about customers' preferences, including color, style, and product category. This opens up the possibility to send targeted content based on the types of products they are most likely to be interested in. For example, you might send customers updates about new releases or display products in the colorway they might be interested in.
New products and excess stock
Armed with comprehensive data about your customers' preferences - including product categories, brands, and styles - you can use segmentation to meet your changing business objectives. When promoting new products or selling excess stock, you can target content to shoppers who are most likely to engage.
How to choose a behavioral targeting solution
There are many behavioral targeting companies out there, but it's worth looking for certain criteria to make sure you select a tool that helps you maximize ROI. Here are three things to look out for when comparing behavioral targeting companies.
Unified customer data
To build a holistic view of individual shoppers, you need to be able to join up the data collected via various channels. A personalization platform that sits between your ecommerce platform and ESP will help you collect data about shoppers across channels and devices.
High identification rate
Choose behavioral targeting technology that allows you to identify as many customers as possible, no matter which device and channel they are on. The more shoppers you are able to recognize, the better you can follow up with targeted content.
Real time dynamic content
It’s no use building a picture of your customers if you can’t provide them with timely, engaging offers. Web and email content should update in real time depending on the individual customer’s most recent behavior, current offers, and other factors such as weather and geo-location.
Getting started with behavioral targeting
Behavioral targeting allows marketers to take control of customer data to drive revenue and improve customer experience.
But accessing behavioral and transactional data for marketing campaigns can be a slow process if your technical team has to pull backend data from your eCommerce platform. To make segmentation easier, you can adopt a real-time personalization platform like Fresh Relevance.
Our behavioral targeting technology allows marketers to quickly access and implement real-time customer data without relying on other teams. You can also combine segments with marketing rules to engage customers with specific content based on your business objectives.
Find out how Fresh Relevance's behavioral targeting technology helps you deliver relevant marketing messages to customers based on their behavior: