Behavioral Segmentation

Behavioral Segmentation

Behavior of people is important from the perspective of both companies and people.

Humans interpret other humans based on their behavior and determine our fondness or friendliness upon it.
Similar tactics are adopted by companies to decide upon their target audience based on their behavior. Once the behavior is identified then it becomes easy to target the user. While sponsoring a product on Facebook, brands or companies sort out their audience based on their behavior.

WHAT IS BEHAVIORAL SEGMENTATION? DEFINITION
Behavioral Segmentation (BS) is in marketing the approach or process of dividing the total market into smaller homogeneous groups or even individual persons based on the (buying) behavior of customers or prospective customers.
Companies can apply BS both online and offline. For example, Amazon uses BS to recommend products and music apps analyze users' behavior to recommended other songs. Customized Google ads visible on the videos we watch is also a form of BS. Artificial intelligence distinguishes target audiences based on their behavior like watching a particular video or a channel we subscribe to or a website we visit. AI takes time to learn the behavior of a person and then starts showing results based on person behavior.
Today it has become easy for a business to collect user data and track user behavior. Due to digital tools like apps and websites companies can track the activities of customers like the source that drove a customer to the website, the product he or she added into the cart and past experiences.

CATEGORIES OF BEHAVIORAL SEGMENTATION
A customer can be segmented based on follower behaviors among others:

Usage and Consumption of a product/service
Purchasing behavior
Timing or Occasion
Customer Loyalty
Status
Benefits sought
Buyer journey stage

SOME MARKETING STRATEGIES USED IN BEHAVIOR SEGMENTATION
Here are the typical processes and methods that are being used in BS:

Tracking activities over various websites and apps
Analyzing this data in order to understand the customer behavior, like what his specific needs are
Retargeting
Location-based
Price by device
Complimentary products
Product suggestions or recommendation

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Shyam Paliwal
Student (MBA), India

Examples of How Human Behaviour is Tracked and Used

Behavioural segmentation can generate considerable benefits for the companies using it. It is a powerful tool and is a significant step companies should consider if they are looking to introduce and implement personalization in the future.

HOW BEHAVIORAL SEGMENTATION WORKS TECHNICALLY
Trackers are installed – which we as a visitor never see – on websites that track the visitor's activity or behaviour over websites and each tracker creates an ID for the visitors associated with us, with browser, account and that ID follows visitors around the web and that ID links behaviour to the individual's records and adds info one by one.

Behaviour that is captured includes activities like how often users visit a website, their engagement, bouncing back, the time they spent on the product's page and many others. These are analysed through behavioural segmentation, can lead to more conversions, and greater customer loyalty.

EXAMPLES OF BEHAVIORAL SEGMENTATION BY COMPANIES
Facebook — Facebook collects data by observing your behaviour on their platform and even on other websites. For example if we like certain bands, restaurants and celebrities' pages. Facebook draws an inference, the stuff we like over Facebook, it is an indication that we have an interest in it.
Furthermore, our posts content not only the textual content but also the videos we post or we share with our friends over Facebook which also says a lot about us. So there are many ways through which Facebook learns about individual behaviour. The websites we visit, the games we play, the apps we install can all be tracked as a part of this broader landscape. As a result Facebook has a really good idea, whether someone is looking for a new computer or for a cell phone this all comes through browsing behaviour.

Netflix — Netflix monitors our activity on its website and app, these activities data is getting collected in their system. Based on this behaviour data what we have watched or added on our watch list or rated, and commented on Netflix suggested to us the similar one. Using this personalization, each user receives a unique experience. Netflix is aware of the content that matters to each user and presents recommendations based on user behaviour. The majority of its customers are impressed and most of Netflix views coming from recommendations.

Amazon — Product recommendations while purchasing like when we purchase mobile, Amazon suggest us to purchase mobile covers, Screen guard or extra warranty, how many are remaining are not random. These suggestions for customers are based on previous purchase behaviour, buyer journeys or the data that visitor has provided to Amazon every time while using the site.

Nike — Nike uses a multiplatform approach and bringing behavioural segmentation to the next level. It's Run Club app collects data based on runner's achievements and recommends running shoes for runners based on this information collected. Another approach is 'Reserved For You' feature, which 'reserves' a product in the customer's size and presents them with an invitation to buy.