Behavioral analysis is the study of consumer learning and behavior.
From understanding the customer journey to evaluating why consumers may or may not be buying your brand’s products or services, analytics platforms and digital data can identify both opportunities and problem areas, arming marketers with a wealth of highly relevant user information.
Conducting a behavioral analysis involves a number of steps. Here, we detail some key parts of the process.
A step-by-step guide to behavioral analysis
1. Identify priority audience segments.
Start by identifying which segments of your audience are most valuable to your brand. Traditional segmentation techniques relied on characteristics like gender, location or income, making the assumption that these groups have common wants and needs and will therefore respond to the same messaging. But this approach lacks context.
Behavioral data takes into account people’s perceptions and decision-making methods, their motivations and priorities, as well as learned habits which are controlled unconsciously.
Gaining this depth of knowledge will enable you to segment your audience, reaching the right customers with the right products and services at the right time and in some cases, in real-time.
2. Clarify the current and desired customer behavior in these segments.
By studying the actual behavioural data of your existing and potential customers, your brand can begin to segment based on these nuances. Some customers might only use your product or service in a particular context, for example. Take a commuter who buys a specific brand of coffee every week day because the cafe is en route between the station and the office.
This purchase may be habitual, requiring little conscious engagement, and may also occur largely due to convenience.
- How much are they really considering the offering, the brand, the quality of the product and the price they pay?
- If this is the case, how likely is this segment to be receptive to buying more products from that brand (in the coffee example, think cross-selling with pastries, or up-selling to a larger size coffee)?
- How can that company influence them to shop with them at weekends too, or to actively endorse their offering among their peer group?
Segmenting audiences according to their level of engagement with your brand – how much they need or want your product and what triggers them to make a purchase, for example – will enable you not only to identify the most valuable audiences, but understand how, where and when is best to reach them.
3. Use first, second and third party data to create your personas.
There are three key sources of data: first, second and third party. Each of these play a valuable role in developing telling customer insights that can be used to develop behavioral data-driven personas.
- First party data collection is data gathered and owned by the brand. This includes subscription data, behavioral or social data, for example.
- Second party data is effectively first party data direct from an external source. This entails the sharing of high quality data between partners.
- Third party data collection is externally-sourced data from a specialist analytics company or industry experts.
Combining one or more of these sources can give you invaluable information that goes far beyond demographics. It might detail what consumers know about your product, how they feel about the wider economy, and their key challenges in life.
This can give rise to important insights that enable you to develop truly comprehensive and useful personas.
For example, one insight might be that many women in their thirties worry about not spending enough time with their children due to the demands of work, yet have a hefty mortgage to pay.
This truth will shape the resulting persona – outlining their values, motivations and priorities in life.
Such insights can underpin a marketing campaign to ensure your messaging really speaks to the target audience in question, demonstrating your understanding.
4. Take the time to truly understand the customer journey.
Today’s customer journey spans multiple devices, channels and touchpoints – both online and offline – making it a challenge for brands to track.
Behavioral analysis can help you better understand exactly how and why a purchase is made, putting those clicks, interactions, downloads and sales into context.
Combining data detailing how many times a customer has interacted with your brand via which channels, with information about what they have bought and how regularly, can reveal powerful insights into their purchase journey.
This will help you to understand how, where and when to interact with them, as well as enabling you to identify any opportunities to better serve their needs. It will also allow you to identify any pain points that need to be addressed.
5. Apply your behavioral analysis to a campaign.
Once your brand has carried out this level of behavioral analysis, it can apply this knowledge to better shape a campaign.
A good example is Kraft, which last year wanted to remove the artificial colors and preservatives from its popular macaroni and cheese product. It knew that its audience was very averse to change, so it conducted behavioral data analysis to gain a deeper understanding of its customers.
After analyzing consumers’ product knowledge and finding out how they felt about the change, Kraft quietly rolled out the updated product to give consumers time to adapt. It then waited several months before running adverts communicating the improved ingredients.
Behavioral analysis enabled Kraft to pitch the change in the right way, promoting the merits of the new recipe without upsetting loyal customers.
It pays to know your audience.
Understanding not just how old your target consumer is, where they live or how much they earn, but what keeps them awake at night, what they value, and what role brands play in their lives forms the bedrock of any successful and creative marketing campaign, whether social media, email or print for instance.
By segmenting your target audience based on behavioral analysis, you can deliver the right messaging to the right person at the right time.
The proof is in the response.
Volkswagen China is one brand that proved the value of behavioral analysis in their attempt to understand their consumers’ aspirations and identify future customers amongst their web users.
The car manufacturer’s research method analyzed their digital marketing strategy across recent online behavioral data and customer behavior via data sets in social, website and mobile, as well as historic responses to email campaigns. It used this information to segment its customer list into consumers who were ready to be contacted by sales, those who needed further nurturing, and those who simply wanted brand information.
Volkswagen then delivered the right messaging at the optimum time in the customer buying cycle.
As a result, its prospect and lead conversion rate increased by over 50%, in addition to achieving an increase in ROI and improved media efficiency.
Understand what’s working, and why.
But delivering the work is only the first important piece when it comes to understanding consumer behavior and shopping behaviors. To ensure you know what’s working and why (and equally what isn’t), it’s important to continually evaluate your approach.
People change, the world changes, and trends come and go, but there’s no substitute for knowing what really makes your customers tick.