Understanding Behavioral Targeting for Business Growth

Ready to take your business to the next level? It’s time to get strategic with behavioral targeting. Instead of using a one-size-fits-all approach, it lets you connect with your audience based on their specific interests and browsing habits.

In this article, we’ll dive into behavioral targeting, covering everything you need to know, including ethical implementation and segmentation techniques. By the end, you’ll see how this strategy can play a key role in boosting your business metrics and driving growth. Keep reading to find out more.

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What Is Behavioral Targeting?

Behavioral targeting is when companies track what you do online and then use that information to decide what kind of ads (or emails) to display to you. Usually, such tracking occurs in two directions: interactions, including searches, website visits, content interactions, etc., and purchases.

There are a few types of behavioral targeting that companies use:

• Onsite behavioral targeting, which is when ads are placed on a particular website. They allow brands to discover the interests of their users and offer them the best solutions.
• Retargeting, which involves serving ads to a user based on their past interactions with a particular website or online retailer. For example, if a customer looks at a pair of sneakers on one website, they may start seeing sneaker ads following them around the web. Retargeting places cookies on their browser so that companies can remember them.
• Geotargeting, this uses the customer’s location to deliver targeted ads. For instance, if you search “pizza joint” on your phone, the restaurants nearest to your location will begin displaying ads in an attempt to attract your business.
• Network behavioral targeting, here ads are placed on various networks. They allow brands to discover the interests of their users across multiple sites and offer them the best solutions.
• Demographic targeting, this targets ads based on characteristics such as age, gender, and income.

Contextual vs. Behavioral Targeting

Some marketers may confuse behavioral with contextual targeting. These are two distinct marketing strategies. While both strategies aim to deliver personalized ads to consumers, they differ in their approach.

• Contextual targeting involves displaying ads based on the content of the website on which the ad appears. For example, placing an ad for cookware on a recipe site or an ad for running shoes on a fitness forum. It is not behavioral targeting because the ad will show up regardless of a user’s actions on the page.
• Behavioral targeting involves segmenting customers based on web browsing behavior, including things like pages visited, searches performed, links clicked, and products purchased.

Benefits of Behavioral Targeting

According to Accenture, 64% of consumers want a faster response to their changing needs, while 88% of executives admit they can’t keep pace with customers. One solution is strategic behavioral targeting. Here are 4 key benefits:

More Relevant Ads

Targeting allows advertisers to deliver more relevant ads which means less annoying, off-base promotions, and more offers for products and services users are inclined to actually want or need.

Improved Targeting Across Devices

Users are followed across all their devices to ensure continuity in targeting. So if you research a vacation destination on your computer, ads can later follow you on your smartphone,reminding you about flight deals to that location.

Better Attribution Analytics

Detailed analytics around behavioral patterns and responses to targeted ads allows marketers to channel budgets into the campaigns, messages, devices, and customer segments driving the highest ROI. This optimization ensures maximum efficiency.

Higher Conversion Rates

With relevance comes higher ad engagement, brand interest, and intent to purchase products or services. This boosts click-through rates and reduces waste, resulting in higher conversion rates for advertisers.

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How Behavioral Targeting Works

Behavioral targeting relies on turning user data breadcrumbs into actionable insights for customizing ad content and delivering it on the fly. It operates through three main steps:

1. Data Collection. The first vital component is gathering extensive data on user interests and habits through tracking activities across websites and devices. As people search and interact with the web, for instance, reading content or shopping online – monitoring technology like cookies or browser fingerprinting allows companies to compile detailed profiles on users.Common elements that get documented are search queries, pages and articles, viewed articles, products purchased, ads clicked, device data such as locations, demographic info, etc.
2. Analytics & Segmentation. Next, sophisticated analytics comb through the raw behavioral data to derive patterns, categories, and insights about groups of users. Analytics helps segment audiences into groups with common attributes like new parents, adventure travelers, sports fans, small business owners, etc.Advertisers then identify the topical interests, purchasing needs, income levels, life stages, and intent signals of each target segment. These become the basis for shaping highly customized ad campaigns.
3. Personalized Ad Delivery. Finally, when users visit websites, marketers instantly scan their browser cookies and data profiles to determine which segments they belong to.Websites display ads in real-time to reflect the inferred interests and intent tied to the browser/device at that moment based on past behavioral patterns. So two people reading the same article may see completely different ads in their sidebars or feeds based on their behavioral targeting profile.

Ethical Behavioral Targeting

Behavioral targeting might sound like a demonic practice and it does raise some understandable ethical concerns about consumer privacy and manipulation. However, there are a few solutions that allow companies to continue leveraging user data to deliver relevance, without resorting to objectionable practices.

Firstly, transparency is key – users should always know when and how their data gets collected and shared, and how it is used by companies or third parties. In this instance, only using “first party cookies” enables personalization while restricting the spread of data to unknown entities.

Additionally, providing consumers with accessible ways to control or delete their behavioral data allows greater autonomy over how profiles get utilized. Alongside cybersecurity investments to keep sensitive information safe from exposure, these measures counterbalance digitally-invasive revenue motives.

Finally, as behavioral intelligence relies on the timing of engagements, brands have to ensure it ultimately serves each individual’s best interests like saving time, money, and frustration.

10 Ways to Do Audience Segmentation

By segmenting your audience, you can create more effective marketing strategy that resonate better with your audience. Keep in mind that these are just a few examples of audience segmentation. You can also combine multiple segmentation strategies to create more defined and targeted campaigns .

1. Here are 10 ways to segment your audience:
   Demographic segmentation, this is all about classifying your audience according to age, gender, income, education, ethnicity, religion, job title, and industry. You can do this using tools like Facebook Ads Manager, Google Ads, and LinkedIn Ads.
2. Psychographic segmentation, this divides your audience according to their personality traits, values, interests, and lifestyles. For instance, a clothing brand might segment its audience based on their fashion preferences, hobbies, and social media activity. Tools such as Facebook Audience Insights, Google Analytics, and SurveyMonkey can be used for this matter.
3. Geographic segmentation, which lets you categorize your audience according to their location, like country, region, city, or even zip code. For instance, a travel company might segment its audience based on their travel destination preferences. Facebook Ads Manager, Google Ads, and Mailchimp provide options for geographic segmentation.
4. Behavioral segmentation, this allows you to segment user info based on behavior, such as purchase history, website activity, and response to marketing campaigns. An eCommerce company may segment its audience based on the frequency of their purchases, average order value, and cart abandonment rate. Tools that offer behavioral segmentation include Google Analytics, HubSpot, and Kissmetrics.
5. Occasion-based segmentation, revolves around dividing your audience based on occasions or events , such as holidays, birthdays, or anniversaries. For instance, a gift shop may segment its audience based on the occasion they are buying a gift for. It can be done with Mailchimp, Campaign Monitor, or Constant Contact.
6. Benefit-based segmentation, which sorts groups based on the benefits users seek from your product or service. For example, a skincare brand may segment its audience based on their skin type, concerns, and desired benefits. Some of the tools that offer such segmentation include Google Analytics, HubSpot, and Kissmetrics.
7. Value-based segmentation involves dividing up your audience based on their values, such as environmentalism, social responsibility, and sustainability. For example, a clothing brand may segment its audience based on their ethical and sustainable fashion preferences. Tools that offer value-based segmentation include Facebook Ads Manager, Google Ads, and Mailchimp.
8. Usage-based segmentation, this is when the audience is classified on the usage of your product or service, such as heavy users, light users, and non-users. For example, a software company may segment its audience based on their usage frequency, feature usage, and satisfaction level.
9. Channel-based segmentation, lets you separate your audience based on the channels they use to interact with your brand, such as email, social media, or mobile apps. For example, a marketing agency may segment its audience based on their preferred communication channels. Some of the tools that offer channel-based segmentation include Mailchimp, Campaign Monitor, and Constant Contact.
10. Customer journey-based segmentation, here you can split users up based on the stages in the customer journey, such as awareness, consideration, purchase, and loyalty. For example, an e-commerce company may segment its audience based on their stage in the sales funnel 1. Some of the tools that offer customer journey-based segmentation include Google Analytics, HubSpot, and Kissmetrics.

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Wrap Up

Behavioral targeting offers immense potential to connect with customers and prospects in a highly relevant, timely, and personalized manner. By ethically collecting and leveraging data to understand its audience and their segments, they can customize their messaging to align with the inferred interests and user intent, brands can drive greater engagement and conversions supporting business growth objectives.