Behavioral Segmentation: Definition, Types, Real-Life Examples
Behavioral segmentation is a type of customer segmentation. It divides customers based on their behavior towards a product or service. It means that the approach looks at how customers interact with a company and its products. It includes how frequently they make purchases, the benefits they look for, and their usage patterns.
Behavioral segmentation is an essential tool for marketing specialists. It provides insights into the factors influencing customer behavior and purchasing decisions. It allows companies to see patterns in customer behavior. Thus, create more effective marketing strategies that speak directly to the needs and preferences of their audience. Companies can use behavioral segmentation to improve customer engagement and loyalty, increase sales, and boost profitability.
This article will explore the different types of behavioral segmentation. We will check out some real-life examples of how companies have successfully implemented this approach. We will also cover the best practices for implementing the approach in your marketing strategy.
Types of Behavioral Segmentation
The importance of behavioral segmentation lies in its ability to help companies create marketing campaigns suitable for their audience. Companies can use several behavioral segmentation types to understand their customers better and create marketing campaigns. Here let’s look at three critical types of behavioral segmentation.
- The benefit sought. This type of segmentation looks at the specific benefits or solutions customers seek from a product or service. For example, a health food company might segment its customers based on their desire for weight loss, increased energy, or better digestion. The company can create targeted marketing messages and product offerings that meet those needs by understanding the different benefits customers seek.
- Occasion-based. Occasion-based segmentation looks at the specific occasions or events that prompt customers to purchase. For example, a gift retailer might segment its customers based on occasions such as weddings, birthdays, or holidays. By understanding the specific events that drive customer purchases, the company can create targeted marketing campaigns and promotions more likely to result in a sale.
- User status. User status segmentation divides customers based on their relationship with the product or service. For example, a subscription-based service might segment customers based on several factors. It includes whether they are new subscribers, long-time customers, or at risk of canceling their subscription. By understanding the different user statuses, the company can create targeted marketing messages and offers that cater to each group’s specific needs and preferences.
Real-Life Examples of Behavioral Segmentation
Real-life examples can provide insights into how companies use behavioral segmentation to improve their marketing strategies and drive business growth. Here are three examples of companies that have successfully implemented behavioral segmentation.
- Benefit sought. A health food company called Quest Nutrition wanted to increase sales of its protein bars and better understand the benefits that customers were seeking. They conducted market research and found that customers mainly bought protein bars for weight loss and meal replacement. The company then created targeted marketing campaigns and product offerings to cater to these benefits. They introduced a line of low-carb protein bars marketed specifically for weight loss and a line for meal replacement. This campaign resulted in an increase in sales and improved customer satisfaction.
- Occasion-based. A gift retailer called Etsy segmented its customers based on the specific occasions or events that drove their purchases. For example, they found that customers often purchased gifts for weddings, baby showers, and birthdays. The company then created targeted marketing campaigns for each occasion and promoted specific products that would be appropriate for each event. It resulted in increased sales and improved customer engagement.
- User status. A subscription-based service called Birchbox segmented its customers based on their user status. They found that new subscribers were most interested in learning about new products and experimenting with different brands. However, long-time customers were more interested in customization and personalization. Birchbox then created targeted marketing campaigns and product offerings for each group. For example, they introduced a personalized box option for long-time customers and a “discovery box” option for new subscribers. It resulted in increased customer satisfaction and reduced churn.
Best Practices for Implementing Behavioral Segmentation
To effectively implement behavioral segmentation, companies should follow these best practices.
- Conducting market research. Companies should conduct market research quite frequently. It will help better to understand customers’ needs, preferences, and behaviors. In addition, it will help them identify the most effective segmentation types and create targeted marketing campaigns that resonate with their audience.
- Using customer data effectively. Companies should use customer data to identify such things as patterns and trends in customer behavior. It includes data on customer demographics, purchase history, and online behavior. By using this data effectively, companies can create more targeted marketing messages and offers, which are more likely to drive engagement and sales.
- Creating targeted marketing campaigns. Companies should create targeted marketing campaigns tailored to specific segments of their users. It includes creating messaging and offers catering to the specific benefits, occasions, or user statuses most relevant to each group. By creating targeted campaigns, companies can improve customer engagement and drive sales.
In conclusion, behavioral segmentation is essential for companies looking for ways to understand their customers better and create more effective marketing strategies. One of the ways is to segment their audience based on behavior. This way, companies can create targeted campaigns that resonate with their audience and drive engagement and sales.
This article explored the different types of behavioral segmentation, real-life examples of its implementation, and best practices for its performance. In today’s highly competitive market, understanding your customer’s behavior is crucial for any marketing specialist. This valuable insight can enable you to create tailored campaigns that effectively connect with your target audience.