Behavioral targeting: when people show you who they are, believe them—and market to them accordingly
If someone places an order in your online store, it’s logical to follow up with them to encourage another purchase.
But when do you follow up? With what messaging? And on what channel?
Answering those questions, says Jon Palmer, lead product marketing manager at Klaviyo, requires achieving a holistic, 360-degree view of not only the customer in question, but all of your other customers, subscribers, and potential customers as well—and that means that simply knowing someone placed an order “is not enough,” he says.
As Palmer asks, “what SKU did they buy? When does the typical customer of that SKU go from purchase 1 to purchase 2? And based on this individual’s level of onsite activity and email engagement and average order size, when are they likely to purchase again?”
Ideally, Palmer adds, “you have AI feeding into it, too. So it’s not just historical data, but also what someone is likely to do in the future based on what they’ve done in the past. And other people like them, too.”
It’s a lot to consider—and it’s all part of how behavioral targeting works.
What is behavioral targeting?
Behavioral targeting is a form of personalized marketing in which the recent and historical activities of your subscribers, customers, or web browsers determine the kind of messaging you send them next.
Together, these behavioral data points leave a unique trail of breadcrumbs your brand can scoop up and use to sort people into different categories, or audience segments—making it easier for you to send timely, tailored marketing messages to your target audience.
Behavioral targeting means taking the entirety of customer behavior, and personalizing communication based on that.
Note that the key word there is “together,” Palmer says: “Behavioral targeting means taking the entirety of customer behavior, and personalizing communication based on that.”
What Palmer means by “entirety of customer behavior” is all touchpoints. The words or phrases someone types into your site search, the pages they view most frequently, where they spend the most time on your site and mobile app, what they click on in emails and texts, their in-store and online purchase behavior, activity in your loyalty or rewards program—“the whole thing,” he says.
Source: Klaviyo
Behavioral targeting vs. contextual targeting
Contextual targeting aligns advertising with the webpages on which those ads appear, which makes it less personalized than behavioral targeting. Applicable in the realm of paid retargeting ads, it focuses on the similarities between content and shows shoppers relevant ads on contextually similar sites within the Google Display Network.
The main difference between contextual and behavioral advertising, then, is that contextual advertising is less precise. Whereas contextual targeting creates an ad experience based on where “best-fit” potential customers are likely to browse, behavioral targeting is about crafting a personalized customer experience based on the actual user data you’ve collected—not assumptions you make based on where they’ve landed around the web.
4 key benefits of behavioral targeting for marketing teams
According to Accenture, while 64% of consumers wish companies would respond faster to meet their changing needs, 88% of executives believe their customers are changing faster than their business can keep up.
Strategic behavioral targeting is one solution to that challenge. Here are 4 ways it keeps you competitive at a time when shoppers’ needs are constantly shifting:
1. Behavioral targeting helps you make informed decisions
The beauty of behavioral targeting is that it’s based on facts, not assumptions. Because the bedrock of behavioral targeting is consumer data that goes beyond mere demographics, it removes the guesswork so that you can focus on building an experience around the actual actions and preferences of your customers—both historical and real-time.
There’s often a disconnect between what people say they’re going to do and what they actually do. With behavioral targeting, you’re actually mapping what the customer has done and has demonstrated interest in.
“There’s often a disconnect between what people say they’re going to do and what they actually do,” points out Lucina Kress Rowe, principal customer success manager at Klaviyo. With behavioral targeting, “you’re actually mapping what the customer has done and has demonstrated interest in, even if they’ve never told you about it.”
In other words, you don’t have to go searching in the dark to discover what an exceptional customer experience looks like. Whatever your marketing message may be, behavioral targeting uses observable, trackable data points to ensure it resonates with the customer who receives it—at any given stage of the customer lifecycle.
2. Behavioral targeting improves customer engagement
As Devin Bhatia, principal customer success manager at Klaviyo, points out, “the barrier to entry for starting a company is lower than ever before, and that means the battle for attention is greater than ever before.”
The barrier to entry for starting a company is lower than ever before, and that means the battle for attention is greater than ever before.
By sending relevant content to your subscribers, “you increase the chance that they’ll not only engage with it, but also actually enjoy it and look forward to hearing from your brand again,” Bhatia explains. “It becomes a different type of experience. It’s a lot more personal.”
It’s also a lot more worthy of attention, clicks, and conversions. While 71% of consumers expect personalization from the brands they interact with, even more (76%) get frustrated when they don’t get it, according to McKinsey & Company—and companies that excel at personalization in marketing generate 40% more revenue from related activities than average players.
Source: McKinsey & Company
“If you care about growing a business in the long term,” Palmer says, “behavioral targeting is definitely going to help with customer retention and optimizing for customer lifetime value (CLTV).”
If you care about growing a business in the long term, behavioral targeting is definitely going to help with customer retention.
3. Behavioral targeting boosts deliverability
Because inbox providers take user engagement into account when deciding whether to allow your emails into inboxes or filter them out as spam, “sending higher-quality, personalized emails, to people who actually want to receive these emails, creates a better customer experience and saves your deliverability,” Bhatia says.
Sending higher-quality, personalized emails, to people who actually want to receive these emails, creates a better customer experience and saves your deliverability.
“If you mess up your deliverability, you have a headache for a few months, maybe even half a year,” Bhatia adds. “So that becomes really important.”
4. Behavioral targeting makes your marketing spend more efficient—and effective
Achieving your return on investment (ROI) goals requires investing in the marketing strategies, channels, and campaigns that resonate with prospects and customers.
Source: Klaviyo marketing mix report
By narrowing your marketing scope so that you stop throwing everything at everyone and hoping something sticks, behavioral targeting ensures you’re not wasting money, time, or other valuable resources on efforts that just aren’t working. Instead, you’re making use of the channels that drive high conversion rates and give back the value you’ve put into them.
Follow your audience’s lead with Klaviyo
Every time someone interacts with your business, from opening an email to refilling a subscription from your ecommerce store, they leave you a clue about who they are in relation to your brand—what makes them click, what makes them bounce, and what makes them buy.
It’s much easier to make decisions backed by data than it is to guess and hope you’re right—and the actions of your audience can be one of the most powerful data sources for your brand.
But in order to get the most out of behavioral targeting, you need tech like Klaviyo, which powers smarter digital relationships by activating all your data in real time, connecting you with customers through a seamless user experience across multiple channels, and guiding your efforts with built-in AI and analytics.
With data collection, data storage, data transformation, marketing activation and orchestration, and customer insight analysis all under the same roof, Klaviyo “makes sure that as the data’s arriving, we’re also making it very purposeful for all the different ways it’s going to be used,” explains Nick Kobayashi, group product manager at Klaviyo.
Your site visitors, subscribers, and customers hold all the information you need to accomplish that. All you have to do is follow their lead.
Want to go beyond behavioral targeting basics? We cover everything you need to know about building and executing a smart, ethical, and effective behavioral targeting marketing strategy in this series. Check out:
Behavioral targeting FAQs
What are the pros and cons of behavioral targeting?
The pros of behavioral targeting include making more informed marketing decisions, improving customer engagement, boosting marketing metrics like clicks and conversions, and making marketing spend more efficient. The cons of behavioral targeting are mostly related to the ethical concerns it raises about personal data privacy, especially behavioral targeting based on third-party cookies and tracking pixels. Marketers can solve those problems by rooting their behavioral targeting efforts in zero- and first-party data, in which subscribers and customers explicitly consent to sharing their personal information with a brand.
What are the main types of behavioral targeting?
The main types of behavioral targeting include on-site behavioral targeting, in which brands display particular site ads and content based on the actions someone has taken or is currently taking on their website or in their marketing messages; and behavioral targeting in owned marketing efforts, in which brands deliver personalized email marketing campaigns, SMS marketing campaigns, and mobile push notifications based on observable consumer behavior.
What is online behavioral targeting?
Online behavioral targeting is a form of online advertising in which recent or historical browsing behavior, email and SMS engagement, purchase activity, and other behavioral patterns determine the kind of messaging you send your subscribers, customers, or web browsers next.