The definitive guide to Behavioural Segmentation

September 16, 2021
By Poonam Reid

What is it, how do we use it and most importantly how can it help with your marketing acquisition strategy? When it comes to selling and offering services no customer is the same, because of this it is key to identify trends that currently exist with your target audience and customers.

The definitive guide to Behavioural Segmentation

What is behavioural segmentation?

Behavioural segmentation is only a slice of the Market Segmentation pie, within behaviour we explore groups, audiences, and both prospects and customers by a person’s actions and behaviour. Other slices include psychographic and demographic segmentation which analyses who makes up your customers whilst behavioural segmentation drills down to what your customers are doing.

Behaviour of customers with regard to your products and services can be grouped into the following:

  • How products and services are used
  • Customers attitudes towards your offerings
  • Awareness and knowledge
  • How customers convert into buyers

Categories of behavioural segmentation

Below I have listed the different areas of behavioural segmentation. Depending on the products and services your company offer some areas will be more relevant for you to take a deeper dive into when analysing your customers.

  1. Purchasing behaviour – Allows you to gain insight into customers transaction history showing you how and why they convert as well being able to delve deeper into which areas of the buyers’ journey perform well, this in turn will enable you to track trends and better focus marketing spend.
  2. Usage behaviour – Analyses the frequency of customer interaction with your products. You are able to see how often customers use it and which features they use more. Data gathered from this can be effectively used to update your company’s marketing strategy.
  3. Customer Journey stage – Where in their journey are they? You may be doing this already as part of your wider marketing strategy but this is a great one to reveal customer pain points within the following stages (Awareness, consideration, purchase, retention, advocacy) where you may need more focus.
  4. Customer Satisfaction and Customer loyalty – How happy are your customers and which are the most loyal? You may be measuring this through surveys, but real-time behavioural data is far more accurate. As a business you want to also know who is most loyal and provides the highest customer lifetime value. Once identified you can gain insights into their needs, retaining them with special offers and rewards.
  5. Interests – What products and services in particular keep your customers interested, is it that amazing product user interface or the helpful customer service team that keep customers coming back for more? Subscription service providers are great examples keeping their customers interested, for example Netflix track users watch lists and suggest similar films and shows to keep their subscribers coming back for more.

So why segment based on customer behaviour?

  • Better personal experiences – Hopefully the days of sending out the same messaging to your entire database have gone. By knowing and better understanding your customers you can connect to each customer on a personal level and send relevant offers and services, increasing both engagement and retention.

  • Amplified customer engagement – Filtering customers based on interested and uninterested will help you target your products and services towards customers who want it the most.

  • Increased targeting accuracy – This is a great to take advantage of customer behaviours, by knowing insights such as for example loyal customers enjoy VIP offers and rewards you direct your messaging and invest budget where you know it will have the best ROI.

  • Trackable – Constantly improve results by tracking engagement.

  • Growth in brand loyalty – We all know customers who feel loved will advocate your brand, and as customer loyalty increases customer lifetime value, so will your overall business revenue.

  • Cost – effectiveness – Stop wasting budget on cold leads, and invest in those customers that most valuable.

    Written by Poonam Reid - Digital Marketing Specialist, CRMT Digital

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