Share on facebook
Share on linkedin
Share on twitter
Share on facebook
Share on linkedin
Share on twitter

6 Key Parameters to Help You With Behavioral Segmentation

In the world of online retail, knowing who your customers are is only half the battle. Equally as important as knowing their demographic information is understanding how they behave as customers, so you can tailor your marketing offering to their specific needs. 

 

What Is Behavioral Segmentation?

Behavioral segmentation is not the same as market segmentation. While market segmentation encompasses behavioral segmentation, it also includes your customers’ demographic, psychographic and geographic information. Behavioral segmentation, however, focuses specifically on patterns of behavior customers exhibit as they interact with brands and make purchasing decisions.

By leveraging artificial intelligence (AI) to study past behaviors, you can predict customers’ future actions with a high degree of accuracy.

Once you have identified your relevant behavioral methods, you can segment your customers accordingly. Then it is possible to tailor your e-tail marketing to address each segment’s needs.

 

Why Is Behavioral Segmentation Important?

Behavioral segmentation gives you a more intimate knowledge of your customers. Dividing your overall customer base into more effective segments allows you to market to them with a greater degree of personalization, meeting their needs more accurately and creating more compelling content. This means you are allocating your resources more efficiently, ensuring a higher ROI.

Dividing your audience up into segments also allows you to identify your most valuable customers – for example, those higher spenders and/or the most loyal – and prioritize them. And it lets you see how your audience grows over time, so you can adapt your business to meet their changing needs.

 

What Are the Key Behavioral Segmentation Parameters?

1. Purchasing behavior

Purchasing behavior segmentation analyzes how customers act throughout the decision-making process, giving your business real insight into their mindset. How involved are they in the purchasing process? What barriers to purchase stand in their way? And which behaviors are most indicative of purchase-making?

For example, there is a huge difference in customer behavior between someone choosing a new brand of car and someone buying their regular brand of instant coffee. The former is a major purchasing decision with huge differences between the brands – the customer’s choice will make a major difference to their day-to-day life. Whereas the latter is a habitual purchasing decision, born of personal taste rather than detailed market analysis.

2. Usage

How – and how often – your customers use your product or service is a strong predictor of customer loyalty or churn. Segmenting your clients into heavy, medium and light users will help you prioritize marketing to the heavy users while upselling to the others.

3. Benefits-driven

While customers in a certain segment might all buy the same product, they might do so for very different reasons. And you would not know by only analyzing their demographic profiles.

For example, women in their mid-30s might buy the same model of running shoe, some for running, and some only to wear as a comfortable, everyday sneaker. While marketing the same running benefits to all would appear to the joggers among your customers, you would miss out on those just looking for a comfortable sneaker.

4. Buyer journey stage

Knowing which stage your customer is at in the buying journey is crucial to sending them relevant marketing messages in order to increase conversions. It will also let you see if there are any stages where customers are not progressing – perhaps lots of them are putting items in their online shopping basket but not completing checkout, for example. In which case, a coupon could help.

5. Occasion

Occasion- or timing-based behavioral segments can refer to universal occasions like the Black Friday sales and national holidays like Christmas, as well as personal occasions like birthdays, anniversaries, weddings and holidays. As well as major occasions, you can segment your customers based on when they are most receptive to offers, for example if they buy most of their kids’ toys or search family trips during their morning commute ahead of school holidays.

6. User status

Are you marketing to a first-time buyer? A prospective customer? Maybe you are messaging a loyal customer, or one who has defected to a competitor brand? Segmenting customers by user status will help you decide what marketing content is appropriate to send, and how to do so (via email, SMS, in-app notification etc.).

 

Behavioral segmentation is another way to gain a more granular view of your customers. By understanding their motivations, habits and impulses when it comes to making a purchase, you will be better placed to serve their complex needs. 

Want to learn more about effective segmentation strategies and tools you can use to optimize and automate your customer engagement? Contact us today!

WE ARE HERE TO HELP

Let us know the marketing challenges that you’re facing, and how you want to improve your marketing strategy.

YOU MIGHT ALSO LIKE

The Ins and Outs of Owned Marketing

What is the key to marketing success? Understanding your customers, and building and maintaining relationships with them by meeting their needs and wants. One type of marketing that can help you do this efficiently is owned marketing – but what is it and what are its specific benefits and best practices?    What Is Owned Marketing? Owned marketing is a set of customer-focused strategies and tactics that are implemented through your own brand channels, also known as your owned media. These owned channels include your website, app, blog, social media pages, email, SMS, forums and any other media that you own and have complete control over. Owned marketing follows a pull marketing strategy. This means it is used to get your messages out to the market and to increase demand for products or services. In other words, it helps pull people towards your brand. It can also help you establish your brand and voice.   How Is It Different From Paid Marketing and Earned Marketing? Owned marketing is a term often used in conjunction with the concepts of paid marketing and earned marketing, but what is the difference? Paid Marketing           Paid marketing includes any marketing

Proactive Ad Fraud Prevention With Artificial Intelligence

As marketers grapple with the problem of ad fraud and its mounting losses, artificial intelligence (AI) is proving to be an effective weapon that can reverse the tide. Marketers in Asia Pacific continue to throw money at advertising, as ad spending is expected to increase 10.7 percent to US$210.43 billion in 2018, according to eMarketer. However, the ever-growing problem of ad fraud is skewing their reporting and standing in their way of showing better returns. Even mobile marketers who expected more safety with app installs, faced 30 percent more fraud during the first quarter of 2018 compared to the same period last year, according to AppsFlyer’s “The State of Mobile Fraud: Q1 2018” study. Mobile app marketers were exposed to US$700-US$800 million in ad fraud losses worldwide. What makes ad fraud such a challenging problem today?   More Sophisticated Ad Fraud Methods Today In the early days of ad fraud, the methods adopted by fraudsters were relatively simple. They used bots focused on driving large volumes of traffic to websites, bought cheap traffic through auto redirects or employed people to install apps in click farms. Once a click was made or an app was installed, their job was done. However,

COVID Has “Accelerated Digital Transformation From Years to Months”

12 brand leaders discuss the challenges of digital transformation at a virtual roundtable hosted by Campaign and Appier.   How should marketers invest in digital solutions that allow them to engage with their customers both in the short- and long-term? That was one question raised at Digital Transformation in Marketing: Boosting customer engagement with data and AI, a roundtable that looked at the various digital transformation challenges brands are facing in 2020. Hosted by Campaign in partnership with Appier, the session brought together marketing leaders from 13 brands: Citi, Aon, Fuji Xerox, Fairprice Group, Pizza Hut, Yum! Restaurants International, Love, Bonito, Naiise, The Wall Street Journal, Singapore Sports Hub, PropertyGuru Group, MoneySmart and Zespri International. Michelle Wong, SVP, Enterprise Solutions at Appier, kicked off the roundtable with a short presentation about the challenges facing marketers today. One of the major challenges in 2020 is the consumers shift to digital. This is accompanied by a willingness to try new apps and channels, increasing the number of potential touch points for marketers. According to findings by Appier, consumers in SEA are, compared to their North Asian counterparts, more likely to shop outside their home countries, with a staggering 85% willing to try