Behavioral Marketing: What Is It & How Is It Beneficial? [+ Examples]

Imagine being able to anticipate your customers‘ needs and desires before they even realize it themselves. What if you could craft perfectly timed, relevant marketing messages that truly resonate with each individual consumer? That‘s the power of behavioral marketing.

What is Behavioral Marketing?

At its core, behavioral marketing is a strategy that uses data on how consumers act online to better target them with personalized experiences. Rather than relying on broad demographic data, behavioral marketers dig into the nitty gritty of each customer‘s online journey—the searches they conduct, the websites they visit, the links they click, the purchases they make, and more.

By collecting and analyzing this treasure trove of behavioral data, marketers can paint a rich picture of each consumer‘s interests, intent, and place in the buying journey. These valuable insights can then be used to shape everything from the ads a person sees to the emails they receive to the special offers they‘re presented with.

The Psychology of Behavioral Marketing

So why is behavioral marketing so effective? It all comes down to psychology. Extensive research has shown that people respond positively to experiences that are tailored to their unique needs and characteristics. We‘re naturally drawn to information that seems relevant to us and tune out messaging that comes across as generic or disconnected from our goals.

Consider these eye-opening statistics:

• 91% of consumers say they are more likely to shop with brands that provide offers and recommendations that are relevant to them. (Accenture)
• 80% of frequent shoppers only shop with brands that personalize the experience. (SmarterHQ)
• 72% of consumers say they only engage with personalized messaging. (SmarterHQ)

By tapping into behavioral data to understand each customer on an individual level, brands can provide the hyper-relevant, targeted experiences that modern consumers crave.

Behavioral Marketing in Action: 3 Real-World Examples

What does behavioral marketing look like in practice? Let‘s explore three brands that are using this strategy to drive impressive results.

1. Target‘s Pregnancy Prediction Score

Back in 2012, the retail giant Target made headlines when a man complained that his teenage daughter was receiving coupons for baby items. It turned out that Target‘s predictive analytics algorithm had correctly deduced that the girl was pregnant based on her purchase history of unscented lotion, supplements, and cotton balls.

Target had discovered that these specific items, when bought together, were a strong indication that a consumer was in the early stages of pregnancy. The company used this insight to create a "pregnancy prediction score" and send expectant mothers personalized offers for baby products.

While this particular case study raised some eyebrows from a privacy perspective, it‘s a powerful example of how behavioral data can unveil insights a consumer hasn‘t explicitly shared with a brand.

2. Spotify‘s Discover Weekly Playlists

Every Monday, music streaming service Spotify delivers a custom playlist to each user called Discover Weekly. The playlist contains 30 songs that are specifically chosen based on that listener‘s music preferences and listening history.

To curate these personalized playlists, Spotify analyzes a wealth of behavioral data, including:

• Every song the user has listened to on the platform
• Songs the user has "liked" or added to their personal playlists
• Listening preferences of other users with similar music tastes

Spotify then runs this data through complex AI algorithms to identify new songs and artists that the listener is likely to enjoy. The result is a highly curated playlist that keeps users engaged and excited to discover new music week after week.

3. Amazon‘s Personalized Product Recommendations

Amazon is the king of personalized ecommerce, and much of that is due to the company‘s sophisticated use of behavioral data. As soon as you land on Amazon‘s website, you‘re greeted with product recommendations tailored to your specific shopping history and browsing behavior.

Amazon‘s recommendation engine looks at data points like:

• Items you‘ve purchased in the past
• Items you‘ve viewed but haven‘t purchased
• Items you‘ve rated or reviewed
• Items that customers with similar purchase histories have bought

These insights are then used to surface relevant product suggestions in real-time as you shop. You might see sections like "Customers who bought this item also bought" or "Recommended for you" based on your unique data profile.

And these personalized recommendations are incredibly effective. Research has found that product recommendations account for as much as 35% of Amazon‘s total revenue.

3 Behavioral Marketing Strategies to Try

Ready to start putting behavioral insights into action in your own marketing? Here are three strategies to get started with.

1. Behavioral Segmentation

While behavioral marketing enables 1:1 personalization, it‘s not always feasible to deliver completely individualized messaging to every single consumer. That‘s where behavioral segmentation comes in.

With this approach, marketers group consumers into buckets based on shared behaviors, such as:

• Frequent website visitors
• One-time purchasers
• Newsletter subscribers
• Loyalty program members
• Cart abandoners

By segmenting the audience into these behavioral cohorts, marketers can craft targeted messaging that resonates with each group‘s unique characteristics and needs.

For example, The North Face might send a special email offer to customers who have previously purchased ski gear to let them know about an upcoming sale on winter apparel. The messaging could highlight the customer‘s passion for hitting the slopes and position the sale as the perfect opportunity to gear up for their next ski trip.

2. Retargeting

Have you ever looked at a pair of shoes online, only to see an ad for those exact shoes follow you around the internet for days afterward? That‘s retargeting (also known as remarketing) in action.

Retargeting allows you to display advertisements to users who have previously interacted with your brand online. The goal is to stay top-of-mind and entice consumers to come back to your site to complete an action, like making a purchase.

Here are a few common retargeting triggers:

• Visiting a specific product page
• Adding an item to a cart without purchasing
• Viewing a blog post or other content asset
• Lingering on a webpage for a certain period of time

When developing your retargeting strategy, it‘s important to strike the right balance of helpful and relevant without coming across as creepy or invasive. Retargeting is most effective when the consumer is already considering a purchase and just needs an extra nudge to convert.

3. Triggered Email Campaigns

Email is one of the most effective channels for delivering personalized, behavior-based messaging. In fact, marketers have noted a 760% increase in email revenue from segmented campaigns. (Campaign Monitor)

One powerful email marketing tactic is setting up automated campaigns that are triggered to send based on a consumer‘s specific behavior. For example:

• Abandoned cart emails: Automatically send a reminder to consumers who add items to their online shopping cart but don‘t complete the purchase. Include a special discount code to sweeten the deal.

• Post-purchase follow-ups: After a customer makes a purchase, send a personalized thank you email with information on how to get the most out of their new product. You can also include related product recommendations to encourage future purchases.

• Re-engagement emails: If a customer hasn‘t interacted with your brand in a while, send a "We miss you!" email with an exclusive offer or incentive to come back.

The key to successful triggered email campaigns is timing and relevance. You want to reach the customer at the exact moment when they‘re most likely to engage with your brand and deliver content that speaks directly to their needs and interests.

The Future of Behavioral Marketing

As powerful as behavioral marketing is today, it‘s only going to become more sophisticated in the years ahead. Advances in artificial intelligence, machine learning, and predictive analytics will enable brands to analyze massive amounts of behavioral data in real-time to anticipate customer needs and deliver perfectly timed, hyper-personalized experiences.

We‘re also likely to see a greater emphasis on omnichannel personalization that seamlessly connects insights and interactions across touchpoints. A customer might start researching a product on their phone, visit a physical store to see it in person, and then receive a personalized email offer to complete the purchase online. Brands that can stitch together these cross-channel behavioral insights will be well-positioned to provide the cohesive experiences that customers increasingly expect.

At the same time, the growing focus on consumer privacy will require behavioral marketers to be transparent about their data practices and give customers greater control over how their information is collected and used. Building trust will be critical as consumers become more selective about which brands they‘re willing to share their data with.

Mastering Behavioral Marketing

In today‘s competitive landscape, generic, one-size-fits-all marketing simply won‘t cut it. Consumers expect brands to understand and cater to their unique needs and preferences at every interaction. By harnessing the power of behavioral data, marketers can deliver the personalized experiences that drive engagement, conversions, and long-term loyalty.

Of course, behavioral marketing is not without its challenges. Analyzing and acting on vast amounts of data requires the right technology, processes, and skill sets. There are also important privacy considerations to navigate and pitfalls to avoid, like coming across as creepy or invasive.

But for brands that get it right, the rewards of behavioral marketing are substantial. When you can anticipate what your customers want before they even know they want it, you‘re well on your way to building the meaningful, lasting relationships that drive business growth.

The key is to start small, experiment, and iterate as you go. Begin by identifying a few key behavioral segments or triggers to focus on and build out targeted experiences around those insights. As you see results, gradually expand your efforts and invest in more advanced techniques and technologies.

With the right approach, behavioral marketing can be a game changer for businesses of all sizes and industries. So what are you waiting for? The future of marketing is personal—and the time to start is now.