Behavioral Marketing — What You Need to Know

By Madison Taylor
September 6, 2019
spotlight on a partially closed lap top

We’re marketers by profession, but we’re all consumers, too. And what’s the most annoying marketing experience you see as a consumer or a buyer for a business? For a lot of us, it’s marketing that has nothing to do with us.

Whether it’s an ad for a product that doesn’t apply to your business or an email about a subscription you already have, there are few things more irritating than having your day interrupted by irrelevant marketing messages.

It’s not entirely marketers’ faults. The issue is twofold: first of all, marketers have historically had a very hard time correctly figuring out who’s buying their products. Secondly, even when they can identify their market, they’ve had a lot of trouble placing their messaging in front of those people. That’s where behavioral marketing comes in.

What is Behavioral Marketing?

Behavioral marketing is a relatively new system of gathering data — browser behavior, search behavior, IP addresses, cookies, and more — to build a better picture of your user so you can create better-tailored marketing experiences.

The more data you gather, the better you’ll be able to customize your marketing messages. Your customers will visit more pages, linger on certain pages for longer, read certain blog posts, download certain whitepapers, and click on certain CTAs. The more you know about your users, the better the content you can deliver to them which leads to better conversions.

How Can You Use Behavioral Marketing?

The best way to use behavioral marketing is through marketing automation. Not only is there simply too much data for you to track by hand, as thousands of users generate tens of thousands of data points on a daily basis, but automation can act faster and more precisely than you ever could.

The more behavioral data you generate, the more useful it will be. As time goes on, you can start to see trends and patterns in the way people behave, then use those trends to predict future behavior.

Remember, customers don’t like advertising — or at least they think they don’t. What they really don’t like is obtrusive, annoying, irrelevant content that interrupts their online experience. There’s even a term for it: “banner blindness” refers to the fact that consumers don’t even notice advertising when it has nothing to do with their needs.

To combat banner blindness, you need to make your marketing much more personal — focused on the individual, not just the channel or the product. With enough behavioral data and the power of automation, you can do just that.

How to Segment Your Customers

To create effective behavioral marketing, you’ll need to divide your customers and audience into narrow, specific segments. The exact segments you create will depend on your goals and your customers, but there are a few segments that are common to most companies:

    • Geolocation: you can often obtain very specific location data, thanks to the accuracy of location tracking from cell towers, wifi networks, and the location data on people’s cell phones. That means you can identify attendees at relevant trade conferences and events, just by the fact that they were in the building.
    • Visit data: is this a new customer? Or have they visited your site before? You can use cookies to track customers visitation behavior, displaying introductory offers to newcomers and loyalty-based discounts to repeat customers.
    • Motivations: Two different customers might be coming from the same demographic or location, but be looking for very different things from your company. Based on the specific products they’re researching on your site, you can determine what exactly is important to them.
    • Transactional data: What customers buy can be a good predictor of what else they’ll want to buy. The most famous example dates all the way back to 2002, when Target was trying to find a way to market to women in their second trimester of pregnancy. By looking at what they were buying six months before they started buying diapers, Target was able to predict when women were pregnant and market accordingly. This applies to upsells and cross-sells, too. Customers that sign up for the basic version of your product and like it are much more likely to upgrade to the more expensive version than strangers are, so you’ll probably have more luck marketing the basic version first.
    • Engagement: Engagement means a lot of different things to a lot of different companies, so you’ll need to examine what kind of customer interaction is most important to your company. It might be shares, downloads, or time spent on site. But increased engagement is always a good sign — it means that customers are building a relationship with you, which makes them more likely to purchase.

Does Behavioral Marketing Work?

Absolutely! Hubspot has handily compiled some statistics to show how useful behavioral marketing can really be.

    • According to Marketo, open rates increased by 56.68 percent and CTRs increased by 147 percent when companies nurtured leads based on interest.
    • 72 percent of internet users expressed concern about how much information is being collected by the websites they visit. When they were reassured that the collected information was anonymous and not identifiable, those concerns were alleviated.
    • 86 percent of companies whose marketing generated high ROI said that personalization made up 21 percent or more of their budget.
    • When businesses adopt a partial personalization strategy, 78 percent of them experience revenue growth — when they take an advanced personalization strategy, that number goes up to 93 percent.

The takeaway is that behavioral marketing can be a huge opportunity for your company. You’ll be able to anticipate your customers’ needs better, make more informed decisions about your business strategy, and deliver much more relevant and useful content to your customers. That’s a win for everyone.