Traditional advertising has benefits, but for many businesses to stand out in the crowded world of digital marketing, your message must be relevant above all else. Sending targeted and carefully crafted messages based on consumer demographics and interests is no longer enough. You need consumers to connect with your product in a way that leads to purchases. Effective marketing uses behavioral targeting to analyze how an audience interacts with their business.
With today’s robust tracking and analytics capabilities, sending a message and hoping the right person sees it is a thing of the past. Instead, businesses tailor the most effective messages based on behavioral data to create highly personalized and timely online connections. With 91% of consumers more encouraged to purchase when a brand personalizes communications, behavioral targeting in advertising is a powerful marketing tool.
Online behavioral targeting uses people’s behavior to gain insight into which advertising forms will best connect with them. The technique involves gathering behavioral data from interactions with your website or ad campaigns and using this information to create messages highly relevant to a specific user’s interests and habits.
Behavioral targeting in advertising accomplishes several goals, but its primary purpose is to deliver advertising messages to the audience segment that demonstrates the highest level of interest. Identifying this group involves compiling information about their online behavior, like purchase histories, frequent searches and websites they visit to create a complete profile. The more data points you have, the better you understand what motivates your audience — and what they avoid.
With the data you gather from people’s online behavior, you can create audience segments based on any criteria, from how often people interact with your brand to whether they take advantage of special offers, or simply “add to cart” and then log out. Segmenting your audience based on similarities in their behavior lets you tailor your advertising and communications to each segment along their customer journey, ensuring messages correspond with the actions they take.
Behavioral marketing benefits businesses and consumers — personalized advertising is more effective in driving purchases, and consumers avoid seeing content that’s irrelevant to them. Some of the many benefits of behavioral marketing include:
Viewers also benefit from behavioral targeting in the following ways:
Consumers enjoy a more pleasant shopping experience when they engage with personalized ads, and advertisers benefit from increased website activity and sales, which is excellent for your bottom line and reputation.
Behavioral targeting is like building a puzzle. By compiling together behavioral data, such as a user’s web browsing behavior, a person’s actions within your app, or even their responses to other marketing initiatives such as email campaigns. Together, these data points form the basis of your targeted advertising campaign. The process often involves four steps:
The first step in behavioral targeting advertising is data collection. Advertisers gather information about users’ online behavior and interests through various means, such as website visits, clicks, search queries, social media interactions, and more. This data includes user demographics, browsing history, purchase behavior, and even location data. This information can be collected from a variety of sources including cookies, tracking pixels, universal identifiers and other technologies which help in capturing and storing this information.
Once data is collected, it’s used to create user profiles. Advertisers analyze this data to segment users into specific groups based on their interests and behaviors. These segments may include categories like “sports enthusiasts,” “frequent travelers,” “tech-savvy individuals,” and so on. The more granular the segmentation, the more precise the targeting can be. User profiles can be continuously updated as new data is collected.
With user profiles in place, advertisers can now target their ads more effectively. When an individual visits a website or app that supports behavioral targeting, the ad exchange platform checks the user’s profile and matches it with the most relevant ads. Advertisers bid in real-time for ad placement based on the user’s profile, and the winning ad is then displayed to the user. This all happens in the blink of an eye, thanks to programmatic advertising technology.
Advertisers don’t stop at merely displaying relevant ads; they also aim to optimize their campaigns for better results. Through continuous monitoring and analysis of user interactions, they can refine their targeting strategies. This may involve A/B testing different ad creatives, adjusting the frequency of ad display, or fine-tuning the targeting parameters. Advertisers seek to ensure that the right ads are shown to the right users at the right time.
While these four steps sound simple, you need access to a robust method of gathering data and an effective way of implementing the above process for it to succeed. Many behavioral advertisers use a customer data management platform (DMP), leveraging their state-of-the-art data collection and analytics capabilities.
A target behavior is any action that could give you more information about how to communicate effectively with your audience. Some examples of target behaviors include the following:
So, if a consumer visits the same web page periodically to read comparisons between different types of face cream, then visits a manufacturer’s website, you can learn several things aside from their evident desire to buy a new face cream and target your advertising to reflect the user’s preferences.
Another example of targeted advertising would be a consumer who adds a product to their cart but leaves the purchase incomplete. There could be several reasons for this incomplete step, including getting distracted. However, you know the consumers are almost sure they want the product, and you could send them information about the latest deals or reminders to complete their purchase.
Nearly every company has data on their customers. Some collect it proactively, while others end up gathering information unintentionally. Either way, data is only useful if you know the right way to use it to attain any desired results. For example, advertisers want to ensure they implement the information correctly to avoid creating ineffective ad content.
Customer data management platforms are purpose-built for marketing. They collect and unify first-party customer data from multiple sources to build a cohesive view of each customer. With this data and the right platform, organizations can drive growth and revenue, activating known and unknown first-party customer data and informing personalization for the greatest impact.
What makes a DMP beneficial for companies looking to use behavioral targeting? The right DMP will know what kind of data a company needs from users to achieve a specific outcome, drawing from sources of both online and offline data to drive optimal advertising potential.
Computer browsers are one of the most prominent sources of behavior information for targeted ads. However, DMPs tend to go a step further than focusing only on web data. Consumers are people with a variety of interests and preferences — in both professional and leisure realms of life — some of which can’t be determined by only looking at online habits. That’s why the best customer data management platforms, or DMPs take a look at offline information and other data a consumer’s device gathers on a regular basis.
A few other categories DMPs can access to find information on a consumer’s regular habits and histories include:
Gathering these data points to create content that represents the consumer and highlights their interests can be a challenge. Fortunately, with the help of quality data enrichment solutions, the process becomes much more achievable.
While the data categories above define some information DMPs can collect, the specific behaviors that reveal this information aren’t necessarily evident from the data types themselves. To create valuable material, DMPs must monitor a range of web activities and record the relevant information for advertisers to use to their advantage.
Companies that specialize in behavioral marketing by implementing the full potential of DMPs must pay constant attention to their audiences. As users perform specific actions online, such as completing a web search, DMPs record that information to continue the conversation with the consumer through ads.
Behavioral targeting is why, for example, someone may browse through different products on an online storefront without finalizing a purchase. Then, in the following days or weeks, this consumer will begin seeing ads for that particular website all over their feeds as they navigate the web, a reminder of their expressed interest.
Which actions set these kinds of processes in motion? A few of the behaviors DMPs focus on include:
The highly advanced technologies that enable data management and behavior-tracking changed the way companies advertise online unlike any other innovation. Now, consumers can enjoy a richer browsing experience full of ads that speak directly to their interests, while online retailers and service providers reap the benefits of a more efficient, sophisticated means of understanding their audiences.
If your company has engaged in ineffective campaigns, it may be time for you to leap into the data-centered world of behavioral targeting — and we know just the place for you to start.
Increasing your conversion rates has never been easier, thanks to the innovation of behavioral targeting. When you publish content to reach users on a personalized level after they have demonstrated specific interest, you can improve the cost-effectiveness of your advertising, saving both energy and resources.
Lotame is here to help you navigate the unfamiliar territories of data-centered marketing approaches. Our Spherical Platform allows you to accelerate customer data and drive revenue with actionable customer intelligence, tapping into built-in analytics to support personalization and inform your strategic planning.
Ready to try it out and start presenting personalized ads to your audiences? Contact us to learn more about our data enrichment solutions, or request a demo for your behavioral targeting today!