The complete guide to behavioral targeting

Savvy marketers know that it's ineffective to deliver the same marketing content to everyone. It's more powerful to use different approaches for different audiences, such as campaigns specifically designed to recover lapsed customers, engage with regular customers and make the most of high-value customers.

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.

 

How behavioral targeting benefits customers

1. Mimic the in-store personal experience

In physical stores, sales clerks get to know what customers are looking for and suggest the most relevant products at the right time. Behavioral marketing mimics this experience online.

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, 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 data in real time. This 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:

Collect ecommerce data for behavioral targeting

eCommerce website

Aim to collect shoppers’ behavioral data even when they haven’t identified themselves in this session. Cookies let you identify the shopper on their current device. Once they have clicked on an email link or logged into their customer account, the collected behavior can be tied back to their history. Identifying more shoppers is a key step to increasing revenue from behavioral marketing.

Collect mobile and app ecommerce data for behavioral targeting

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.

Collect email ecommerce data for behavioral targeting

Email channels

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.

Collect mobile and app ecommerce data for behavioral targeting

In-store data

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.

 

Customer segmentation

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.

Content targeting

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 social media advertising and Google AdWords.

Examples of behavioral targeting

We’ve seen that behavioral targeting opens up fantastic opportunities for marketers. Now let’s look at the many ways segmentation can be used to drive results in practice. Here are some key audience groups 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 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.

Exclusive offers for frequent browsers
 

2. Frequent shoppers

The history of these visitors indicates that they are probably going to make a repeat purchase. Keep them updated with the latest product recommendations, personalized based on their preferences. Don’t be tempted to reach out with discounts, as this will diminish the value of an order that was likely to take place anyway.

Retarget customers who are likely to make a purchase
 

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. Bargain hunters

Historic purchase data can also be used to identify customers who may be tempted by lower priced items. Encourage engagement with sale items or products that have dropped in price.

6. Replenishment

Replenishment emails target customers who have purchased products that will need to be topped up. Send a timely reminder to shoppers that it’s time to refill their stock. This works especially well for cosmetics, health supplements and consumables. Customers will be more likely to make a repeat purchase, and will also appreciate the timely reminder.

7. Back in stock

Customers' browse data can be used to trigger an automatic email once the browsed product has been restocked. Shoppers will be satisfied that they didn’t miss out on their desired product, and won’t be tempted to turn to a competitor to meet their needs. While the browsed product should be the main focus of the email, you can also include relevant product recommendations to encourage engagement if the recipient has lost interest in the out-of-stock item.

Send back in stock emails to re-engage customers
 

8. Price drop

Leverage browsing data to send automatic price drop alerts. These messages inform shoppers of discounts to their favorite products outside of a formal sale. This provides extra encouragement for price-conscious shoppers and increases loyalty to your brand.

9. Customer preferences

Brand affinity

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.

Product preferences

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

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 a solution 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 slower than you would like if your technical team has to pull back-end data from your eCommerce platform.

To make segmentation easier, you can adopt a real-time personalization platform like Fresh Relevance. Our Segment Builder 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 helps you deliver relevant marketing messages to customers based on their behavior:

Contact our team to get started with behavioral targeting today.