While demographic, geographic, and psychographic segmentation are commonly known and used in the marketing world, now is the time to give behavioural segmentation the credit it deserves as an effective way to customise your marketing efforts and campaigns.
Behavioural segmentation is a modern approach to segmentation that yields the results you've been looking for through other segmentation techniques. Let's dive into this beginner's guide to behavioural segmentation to discover what it is and how you can use it to increase your sales.
What is Behavioural Segmentation?
Behavioural segmentation consists of separating individuals with like-minded behaviors into their groups. Once separated, you can target these groups based on the shared actions and behaviours they exude.
Behavioural segmentation focuses on various customer interests and behaviours, such as the type of content and products consumed, how often these products are consumed, the amount of money spent on products, etc. To effectively utilise this method, you must stop looking at who customers are — their age, gender, marital status, etc. — and start looking at what they do.
The more you understand your customers’ actions and behaviours, the more you'll be able to target them appropriately and optimise your marketing campaigns with personalised messaging.
The Benefits of Behavioural Segmentation
Behavioural segmentation is an extremely effective marketing strategy, and it yields a variety of benefits. By sending the right message to the right people at the right time, you'll:
Streamline your marketing efforts and allocate your resources appropriately, saving yourself the time and money spent on guessing.
Provide opportunities to adjust segmentation strategies to increase productivity and sales.
Build relationships with your customers through personalised content and messaging.
Increase consumer engagement with your brand and products.
How to Use Behavioural Segmentation
Effectively utilising behavioural segmentation begins with acquiring customer behavior data and trends and then analysing and segmenting them accordingly. This first step is vital. A recent survey found that companies who use customer analytics extensively report that they're outperforming their competitors on key performance indicators (KPIs), including ROI (return on investment).
By analysing this data, you'll start to identify your customers' interests, needs, and capabilities and group them with like-minded buyers.
There are multiple ways to segment data and group your customers. Here are the top five ways to segment by customer behaviour. These segmentations can be used individually or combined to bring variety to your marketing campaigns:
1.) Customer Acquisition
Segmenting by customer acquisition focuses on the moment a consumer makes the switch from interested party to active customer (when they made their first purchase). You'll want to look at data regarding when someone gets to know your brand, their initial engagement with your company, and their first purchase of your services or products.
2.) Customer purchasing and spending habits
Segmenting by customer purchasing and spending habits looks at what customers are buying, when they're buying it, how often, and for what purposes. For example, if you own an online clothing store, you can look into who is purchasing sundresses and create a segmented group for everyone who engaged in that purchasing habit. Then, you can create a vibrant summer dress campaign with a discount code for all the dresses on your website to be sent to that specific group who is likely to capitalise on the sale.
3.) Customer journey
Segmenting by customer journey has to do with what “stage” of the buyer’s journey a customer is in. For example, are they a first-time buyer, an occasional user, or a loyal customer? To segment even further, you can look into how long consumers have been interacting with your brand — days, weeks, months, or years — and group them accordingly.
With this information, you can create marketing campaigns that speak specifically to the customer journey a group is in. If, for example, you have a large group of loyal customers who've been engaging with your brand for years, you could send them information about your customer loyalty program since it appeals most to them.
4.) Customer engagement and usage
Segmenting by customer engagement and usage dives into how customers are interacting with your brand via your website, including how often they engage (how many hours per day, days per week, etc.). With this information, you can help your least engaged customers become your most engaged by offering discounts and promotions to encourage increased engagement with your brand, products, and services.
5.) Customer interests
Segmenting by customer interests is an aspect of behavioural segmentation where you collect data on what customers are interested in by analysing their purchasing habits. With this data, you can then suggest similar items, increase product usage, cross-sell and up-sell, and personalise content. From one confirmed interest (from a purchase), you can infer further interests which will increase further engagement.
Start Using Behavioural Segmentation Today
The sooner you start collecting user data and analysing the behaviours, interests, and actions of your customer base, the sooner you can capitalise on the benefits of behavioural segmentation and create personalised marketing campaigns to increase your sales.