Behavioral targeting vs. contextual targeting
Behavioral targeting is all about collecting data and using it to create a more personalized experience for your audience. These targeted ads are proven to be twice as successful as non-targeted ads.
Contextual targeting is a less personalized approach. It's about displaying ads based on the content of a given page, but not individual demographics. For example, with contextual targeting, a visitor to a makeup company’s site would likely see ads for skincare products. While contextual targeting can be effective, the downside to this approach is that the ad may get lost in the similar content of the page.
Luckily, behavioral and contextual targeting aren't mutually exclusive. You can use behavioral targeting to personalize and improve contextual targeting ads. For example, if a user previously visited a specific makeup company's website, you can show ads for that business on the fashion or skincare site they’re visiting.
Types of Behavioral Segmentation
One of the most critical components of effective marketing is a process called Marketing Segmentation. This process goes beyond the usual consumer data, such as age, sex, and location, to microscale consumer groups based on their member's actions and needs to ensure that their problems are solved efficiently. The desired result is to ultimately increase sales volumes while providing consumers with satisfying shopping experiences. Behavioral segmentation consists of various subcategories of segmentation that include, but are not limited to, the following:
Rather than focusing a business's resources and time on an entire market, demographic segmentation places the organization's focus on the precise demographic most likely to make purchases. This technique centers around demographic variables such as gender, age, education, income, and similar consumer traits that provide businesses with important information about their customer base and how their needs can be more effectively met.
Psychographic segmentation uses the goal of identifying consumer motivation to divide customers into groups centered around consumer personality traits and why they make the decisions they make about the things they choose to purchase. It is used to determine a given marketing campaign's effectiveness and to develop customer service and products that best meet consumer needs.
Geographic segmentation is used by businesses to divide their customer base by geographic locations, such as by city, state, or region, or it can divide a market into different types of areas, such as rural or urban markets. Geographic segmentation helps large companies with national or international markets by focusing on the consumer needs of consumers based in specific locations. It also works for small businesses that have limited budgets.
Occasion-based segmentation is effective for product development and business growth strategies and represents specific occasions that prompt consumers to interact with certain products. For instance, a bar might utilize occasion-based segmentation to promote a particular type of holiday beverage.
Loyalty programs are used as a type of behavioral segmentation that issues rewards and similar incentives to create meaningful consumer interactions that can achieve long-lasting relationships between businesses and the consumers who return to them regularly. Airline frequent flyer programs are prime examples of loyalty programs.
AIDA modeling is a cognitive marketing model that creates consumer awareness of a product and generates interest. This behavioral segmentation helps consumers form emotional connections to products by making a desire for them. The primary goal of AIDS is to prompt consumers to take action and purchase a company's products.
Is Behavioral Targeting Ethical?
Such methods as keyword searches, consumer databases, knowledge of consumer loyalty, and specific information about website visitors allow companies to streamline consumer buying experiences, resulting in more focused purchasing opportunities for every customer. They prevent consumers from digging through mountains of irrelevant products to find what they are looking for and help make shopping experiences more accessible and pleasant.
These things also aid businesses by enhancing consumer conversion rates, lowering marketing costs, and by helping those businesses learn more about their customers to target them over time and provide them with the appropriate messages at ideal times.