While eCommerce owners and marketers are constantly looking for ways in 360 degree angle to connect with their customers in this competitive market, how do we miss this way out called behavioral marketing? An game-changer to the ROI.
Yes, it is said that 77% of marketing ROI comes from segmented, targeted, and triggered campaigns.
As in demographics and psychographics have their place in segmentation approach, this behavioral segmentation is the real game-changer. Makes 60% of the brands in understanding what truly drives your customers. If you’re an eCommerce store owner or marketer looking to enhance customer engagement and boost your conversions, behavioral segmentation is one of the most powerful tools you can adopt.
Let’s dive into what behavioral segmentation is, how it works, and how you can use it to elevate your marketing efforts.
What is behavioral segmentation?
Simply put, behavioral segmentation is the practice of dividing your customer base into segments based on their behavior, specifically how they interact with your brand, website, and products. It goes beyond the surface-level insights like age, gender, or location and looks at what actions customers are taking—or not taking.
Behavioral segmentation can reveal patterns like:
- How frequently a customer purchases from you
- What products they are most interested in
- Their loyalty to your brand
- Whether they prefer discounts or exclusive offers
- How long they spend on your website before purchasing
These behaviors give you actionable insights that can help you deliver more personalized marketing messages, leading to better engagement and higher conversions.
But why behavioral segmentation matter in eCommerce?
When the world evolves, so do the customers and their shopping expectations; the modern consumer expects a personalized shopping experience. Sending the same message to everyone is like throwing spaghetti at the wall—some of it might stick, but most won’t. With behavioral segmentation, you can write your marketing to each customer’s unique journey, making them feel understood and valued.
Well, behavioral segmentation also works at every stage of the customer journey, right from awareness, search, research, purchase, and experience.
Source: Vendasta
Here’s why it’s critical for your eCommerce business:
1. Improved customer experience
Running an email marketing campaign and you writing a message to your customers based on their purchase behavior makes them feel like you ‘get’ them. By understanding their needs, preferences, and behaviors, you can better recommend the product or service manually or via an auto recommendation widget in your email marketing tool and smoother the customer journey.
Ultimately, a more satisfying shopping experience.
2. Higher conversion rates
The more personalized your communication, the higher your chances of converting leads into customers. Behavioral segmentation allows you to send targeted messages at the right time—such as when a customer is most likely to buy.
3. Increased retention and loyalty
Keeping track of customer behavior helps you predict when a customer is at risk of churning and take proactive steps to retain them. This can be via personalized loyalty programs, like exclusive offers, and tailored re-engagement campaigns can keep your customers returning for more.
According to a survey by Epislon and GBH Insights, 80% of respondents are more likely to do business with brands that offer personalization.
4. Optimized marketing spend
Though you have a marketing budget, rather than shooting in the dark and spending it, you can use it for two successful email campaigns. That makes sense, right?
Yes, sending targeted campaigns to specific segments means you’re spending your marketing budget more effectively. You’re not wasting resources on customers who aren’t ready to buy or those who don’t engage with certain types of content.
The different types of behavioral segmentation you should know
Behavioral segmentation can be divided into several categories. Let’s explore these and how they apply to your eCommerce business.
1. Purchase Behavior of your customers
This type of segmentation is nothing but grouping the customers based on their purchasing habits. Some customers buy frequently, while others only make occasional purchases, seasonal purchases, or have never completed a purchase.
How do you use it to your advantage?
- Frequent Buyers: They are your loyal customers and an asset to your business. Rewarding your loyal customers with exclusive offers or early access to new products can encourage them to feel valued and come for more.
For example, you could send them a “Thank You” email with a special discount, or you could engage them in tier gamification, award them with tiers, and give them exclusive access or a discount based on their tier.
- First-time Buyers: Though you have loyal customers, it doesn’t mean first-time buyers are trespassers. Being in the eCommerce industry, you must turn this first-time buyer into a loyal customer and build your asset in this competitive market.
Welcome all your new customers with a personalized email that includes a discount or free shipping for their next purchase. This nurtures the relationship and encourages repeat business.
- Lapsed Buyers: These are customers who haven’t made a purchase in a while. Win them back with a re-engagement campaign offering a limited-time discount or showcasing new products they might like based on previous purchases.
2. Benefits sought customers
Every customer is unique, and so are your products. Customers seek different benefits from the same products. Some may value quality over price, while others are looking for the best deal. Segmenting customers based on the benefits they seek allows you to customize your messaging accordingly.
How do you use it to your advantage?
- Price-sensitive Shoppers: These type of customers exclusively look out for best deals they can rely on, hence send these customers discount-focused messages or notify them about sales and promotions. Well, phrases like “limited-time offer” or “exclusive discount” can appeal to this group.
- Quality-driven Shoppers: These customers always choose quality over the deals. They always emphasize the premium materials or craftsmanship of your products. Highlight how your brand offers lasting value and justify the higher price point.
3. Loyal customers of your business
Segmenting the customers by loyalty can reveal who your brand champions are and who needs a little nudge to stay engaged. You can reward loyal customers with perks, while less-engaged customers can be re-targeted with win-back strategies.
How do you use it to your advantage?
- Loyal Customers: Pull them into gamification, brands like Starbuck, Spehora, and Lego have done this in mind blowing. All you have to do is to, create a VIP segment for your most loyal customers, offering them special discounts, early access to sales, or even a loyalty program where they earn points for every purchase.
- New Customers: On the other hand, you have to encourage your new customers to become repeat buyers by offering incentives for their next purchase, such as free shipping or a discount code.
4. Based on your customer’s engagement level
How frequently do customers interact with your brand? I’m pretty sure you must have analyzed and kept track of this factor. This segmentation focuses on their level of engagement, whether that’s through your website, emails, or social media.
How do you use it to your advantage?
- Highly Engaged Customers: Send these customers personalized content that acknowledges their engagement. Consider sending them exclusive offers or invites to beta test new products as a token of gratitude or love to make them feel special with your brand.
- Low Engagement Customers: Usually, you have to re-engage with less active customers by sending them reminder emails or personalized offers that reflect their browsing history or abandoned carts to prevent them from churning out.
5. Based on your customer journey stage
Segmenting customers based on where they are in the buying process is a great way to provide relevant and timely messaging.
You must analyze and know, if they are just browsing, have added items to their cart, or have they made a purchase.
How do you use it to your advantage?
- Browsers: We all must have been just browsers to most of the brands, even to our favorite brands. Well, leaving them just like ‘browsers’ doesn’t give any value to your business; you always have to look out for conversion.
Sending targeted messages that highlight the benefits of the products they viewed recently or offer a discount to encourage them to take the next step can bring in conversions.
- Cart Abandoners: Oops! These kinds of customers, you have to take a closer look into to make them push down the funnel of purchase. A gentle nudge with a reminder email about their abandoned cart, possibly with a discount or free shipping offer, can bring them back to complete the purchase.
However, it isn’t advisable to provide discounts or offers right off the bat. Sending a reminder email followed by a text after a certain time interval should work, or as a last option, you can send them discounts for the current purchase or the next purchase.
- Recent Purchasers: Send a thank you note email to them for their purchase and suggest complementary products to encourage additional purchases. Personalization at this stage can significantly increase your average order value (AOV).
These are the types of behavioral segmentation; however, you have to know how to implement that effectively in your existing eCommerce strategy without collapsing, which is a skill. Scroll down to learn more about it.
How to Implement Behavioral Segmentation in Your eCommerce Strategy
You must be wondering how you put it into practice? Here are actionable steps to get started and to follow:
1. Collect the Right Data
Data is the key to all your marketing efforts. Yes, right before you can segment customers based on behavior, you need to collect data. This includes tracking their actions on your website, purchase history, email engagement, and more. Tools like Google Analytics, CRM systems, and email marketing platforms like TargetBay, Omnisend, Klaviyo, and Active Campaign can help you gather and analyze this data.
2. Define Your Segments
As a next step process, once you’ve collected enough data, it’s time to define your segments. Look for patterns in customer behavior; there must be patterns that your customers fall into.
For example, you might notice that a certain group of customers only buys during sales, while another group consistently buys new releases. Create segments based on these patterns.
3. Personalize Your Marketing Campaigns
With your segments in place, you can now tailor your marketing messages to each group. Personalization doesn’t just mean adding the customer’s name to the email—it means crafting messages that speak to their specific behaviors and needs.
For example:
– If a customer consistently buys during sales, send them early-bird notifications about upcoming promotions.
– If they’ve abandoned a cart, follow up with a reminder email that includes a discount code to incentivize them to complete the purchase.
4. Test and Optimize
Behavioral segmentation is not a one-and-done process. Continuously test your campaigns to see what works and what doesn’t because every strategy doesn’t work for everyone. Use A/B testing to compare different messages, offers, and timings for each segment. Over time, you’ll refine your approach and see even better results.
5. Monitor and Adjust Segments
As your customer base evolves, so will their behaviors. Regularly review your segments to ensure they’re still relevant. Customers may move from one segment to another, and your marketing strategy should adapt accordingly.
Final Thoughts
Undoubtedly, behavioral segmentation is a powerful tool that allows every eCommerce store owner and marketer like you to better understand and engage with their customers. By segmenting based on actions rather than assumptions, you can create more personalized, relevant experiences that lead to higher conversions, increased customer loyalty, and optimized marketing spend.
Incorporating behavioral segmentation into your strategy might seem overwhelming at first, but the payoff is worth the effort. Start small—collect data, define a few key segments, and personalize your messaging. As you see success, you can refine and expand your segmentation strategy.
Remember, your customers aren’t just numbers—they’re people with unique behaviors, preferences, and needs. Understanding and acting on those behaviors is the key to growing your eCommerce business in today’s competitive market.
