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Behavioral Segmentation Defined + 6 Examples of It in Action
   

Behavioral Segmentation Defined + 6 Examples of It in Action

There is no one size fits all marketing strategy, so every marketer practices some form of audience segmentation.

Sophisticated companies segment by age, income, and location to hone in on their ideal customers. But If you really want to identify your highest value prospects, you need to practice behavioral segmentation as well.

When done right, behavioral segmentation is the best way to get hyper-personal with your marketing.

To understand the power of behavioral knowledge, consider a different context, such as job interviews. Specifically, why do companies check references before making a hire? It’s because they need to find out about the candidate’s behavior. Knowledge of someone’s actual behavior will always trump what they say in an interview, or where they went to school.

The same idea holds in marketing. What a user does in practice reveals valuable information that you can use to craft a compelling and targeted marketing campaign.

What is behavioral segmentation?

Behavioral segmentation is the process of analyzing user behavior and using what you learn from those actions to create personalized marketing experiences. While other forms of marketing segmentation are related to facts about who a customer is, behavioral segmentation is related to what a customer does.

Behavioral segmentation is so powerful because its use cases are unbounded. You can measure just about any behavior you think might be relevant, and then use that information to inform your marketing strategy.

For example, if you track on-site behavior and learn that certain users have all downloaded the same whitepaper, you can send them follow-up emails that include links to related content they might find interesting. That would provide them a more targeted experience than could be achieved without behavioral segmentation.

Another good way to think about behavioral segmentation is in terms of the questions it helps you answer, such as:

  • What is the person doing on-site?
  • What actions has the visitor taken in the past?
  • Is this first-time visitor?
  • Is this a repeat visitor?
  • What’s their time on-site?
  • Did they hit certain pages on the site?
  • Did they visit certain URLs?
  • Are there certain kinds of events that have triggered throughout their purchase history?
  • Is this person a customer?

If you can learn the answers to all those questions, your marketing efforts will be much more informed and effective.

How does behavioral segmentation relate to marketing segmentation?

Behavioral segmentation is used in conjunction with other forms of marketing segmentation to form a robust behavioral marketing strategy. The most common ways to segment are by using:

  • Demographic data (like name, email, location)
  • Firmographic data (like company size and industry type)
  • Contextual data (like if they’re on a tablet or using Safari).

Behavioral segmentation does not supersede other ways of segmentation. It works in conjunction with them. The more data you have, the more personalized you can be. And that’s a very good thing — especially given that increasing personalization across multiple channels can increase overall consumer spending up to 500%.

6 examples of behavioral segmentation in action

Behavioral segmentation comes in many forms, but we’ll limit ourselves to six examples, each of which shows how useful it can be to sort your customers into distinct buckets based on their behavior.

Customer lifecycle stage

It’s important to understand where a user is in terms of customer lifecycle stage. At Proof, we consider things like:

  • Are they a first-time visitor to our site?
  • Are they a repeat visitor?
  • Have they registered for a demo yet?
  • Are they on a trial?
  • Have they converted their trial 14 days later into a paid account?

The answers to those questions (and more) help determine how to best approach a visitor from a marketing perspective. You are not going to show the same retargeting ads to someone who has visited your site once as you would to someone who has visited multiple times, for instance.

When you know what stage someone is in you can send marketing messages that feel more like helpful nudges than annoying ads. The below example of an email from Shopify is a perfect example.

Shopify behavioral segmentation

Shopify email encouraging users to connect a card

Shopify could not have sent such a personalized and timely message did they not vigilantly track lifecycle stage. In this case, they are emailing someone who has signed up for their services but hasn’t connected their bank account yet.

This email is relevant to the user that hasn’t connected their bank account – it’s pretty worthless to every other segment. Segmentation is the key to making sure this is timely.

Purchase behavior

If you were to track just one metric that could help you better target your marketing and sales efforts, it would be purchase behavior. There’s just no better way of determining what someone likes. There’s a reason Amazon’s algorithm puts so much emphasis on what you’ve bought in the past as a way to recommend you future products. It just plain works.

Amazon behavior based recommendation

Amazon’s recommended product section

Timing

Everyone makes different buying decisions based on the time of year. For example, some prime times to spend messaging to a customer align with major life events including birthdays, holidays, weddings, births, and retirement. If you can monitor user behavior and determine a good time to reach out with an offer (especially if it relates to your product), you’ll have a leg up on the competition.

You can get creative here as well. Check out how Lyft crafted an email with a discount offer on weekday rides. This could have easily been generated because they realized a user had taken a Lyft to work, and they wanted to encourage and reinforce this behavior in an effort to cement Lyft as their ride of choice over Uber.

Clicks and engagement

Engagement metrics like clicks and engagement help determine where you should focus your marketing efforts.

Imagine you track a user who comes to your site, stays for over ten minutes, downloads your podcast, and views your FAQ page. That behavioral pattern indicates someone in the “consideration” stage — and as a keen growth marketer, you can use that knowledge to target your outreach accordingly. Maybe they’d be a good candidate to join one of your more in-depth webinars or workshops. This email from Baremetrics provides an example of what outreach of that nature could look like.

behavioral segmentation

You can also assign a higher lead score to that person and feel good about spending considerable resources trying to convert them into a customer.

The same logic holds true for people who show low engagement. Don’t waste your time chasing low-quality leads whose engagement metrics show they are not that interested in your services.

Interests

Clicks and engagement also provide tons of great insight into what people are interested in. And once you know a visitor’s interests, you can craft targeted and relevant messaging.

The blog posts someone reads, the videos they watch, and the pages they visit all tell you quite a bit about how you can best engage them moving forward.

Buzzfeed’s emails are highly curated based on what their users are interested in. This one aims to get people back on their platform using the oldest trick in the internet book — cat content.

Buzzfeed behavioral segmentation

Loyalty

According to the 80/20 rule, 80% of profits will come from your top 20% of customers. Those top 20% are your loyal customers. They make repeat purchases, they engage with your brand online, and they are the most likely to segment in order to tell their friends about your product. Given their power, it only makes sense to take the time to figure out who they are and to treat them right.

One simple, yet effective way to show some customer gratitude is by personalizing your home page for customers like we do at Proof. It’s a great, low-lift way to make your users feel appreciated.

Proof examples of behavioral segmentation

Another solid way to keep your loyal users engaged is through a simple thank you email.

You can identify your power users and send them highly curated thank you emails, such as this one from David’s Tea.

Davids Tea behavioral segmentation

Everyone loves to feel valued and to feel like an individual, not just as a faceless user who contributes to the bottom line.

Summing up

As the old saying goes, “Actions speak louder than words.”

Users won’t always tell you who they are or what they want, so it’s important to monitor what they do. By practicing behavioral segmentation, you vastly improve your ability to reach the right target customer with the right message at the right time.