How to Use Data-Driven Behavior Segmentation to Personalize eCommerce Marketing

If that old adage “it’s nothing personal, it’s just business” defines your online store, congrats, you’ve officially declared yourself out of the running. 

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Now more than ever, eCommerce businesses need to step up their personalization efforts. And the most effective way to leverage personalization? 

Drumroll, please…Using data-driven behavior segmentation to give your marketing strategies that much-needed personal touch. 

We’ve compiled a few of the most impactful, data-backed segmentation strategies for you to use. 

Why Invest in Data-Driven Segmentation 

The fight for your shoppers’ attention just got tougher.  

Online shoppers are flooded by incoming promotional messaging from your competitors. Plus, they are even more careful about spending due to ongoing economic turmoil and inflation. 

If you want to make it easier for them to choose your products out of thousands of other online retailers, then personalization is no longer merely an option but a necessity. But not just any segmentation, data-driven advanced segmentation. 

Data segmentation, or precision targeting, enables you to create specific subgroups based on the behavior of your audience and provide each potential and existing customer with relevant, highly personalized recommendations, ads, and general content. Essentially, you divide (based on data) and conquer.

The beauty of data-backed segmentation lies in its simplicity: you employ the most trusted data source available — your audience. 

Of course, if you can invest in third-party data from reputable, trusted sources, by all means, enrich your own data sources. The more, the merrier. 

However, your audience, including your social media followers, website visitors, actual buyers, and subscribers, are the most valuable data sources for behavior segmentation. 

So, where to start? We’ve gathered five practical examples of data-backed behavior segmentation strategies you can use for your own eCommerce business to foster marketing personalization. 

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5 Data-Backed Segmentation Strategies to Try

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1. Analyze Purchase History

Even when you cater to a niche demographic, crafting highly personalized eCommerce marketing content is crucial to boost repeat purchases and appeal to more people who belong to the same subsegment. 

Analyzing your purchasing history can be incredibly powerful in revealing personalization strategies. You can do this in four key steps. 

Step #1: Gather Your Data

The number of behavioral data points will vary depending on your business model and the parameters you track. 

For example, in addition to your typical demographic, geographic, and psychographic data, you can use behavioral information such as:

• Average purchase value
• Discount/coupon usage
• In-app or online store purchases

Gathering this type of data enables you to pinpoint customers that only buy your products when they receive a newsletter with personalized discount offers. This will allow you to build more strategies where you target them with personalized content across a range of channels.

Step #2: Analyze Your Data

We cannot overstate the importance of data analytics in marketing, as this particular step in the process will help you create your ideal customer profiles and learn about your audience over time.

The key here is to avoid human error and bias during the analytics process, which is why automation is best. Not to mention that automation will save you time and effort.

When handling large volumes of data, it’s best to rely on machine learning and AI-driven software to help you spot the most relevant behavioral and purchase patterns — either by looking into the analytics of your marketing tools and platforms or by investing in a separate tool, such as Analytics Buddy (for Shopify) or Polymer. 

This will enable you to automatically track and detect frequent vs. occasional vs. one-off buyers, high and low spenders, seasonal buyers, etc. 

Step #4: Infuse Your eCommerce Marketing with This Data 

Next, you will want to use your data to boost performance for current and future marketing campaigns. 

From personalized email campaigns and social advertising to special offers, you can leverage this data to drive more repeat purchases and grow your revenue with personalized eCommerce marketing. 

Step #5: Rinse and Repeat

Even the finest personalization efforts need monitoring, since your customers will evolve. 

You will want to repeat steps 1–4 on a regular basis to see how their behavior changes and then adapt your marketing campaigns accordingly.  

And don’t be afraid to really drill down to each shopper. Remember, the purchase history of a single individual can speak volumes about the potential purchases you can inspire from the people who share similarities with that buyer. 

Cross-reference some of their data points, such as purchase power, location, marital status, gender, and education, and you’ll be able to craft eCommerce marketing campaigns that target more people with a higher likelihood of buying from you.

2. Group by Customer Satisfaction

Does your customer journey include occasional satisfaction surveys? If not, it should! 

Collecting first-hand data on customer experience is the most effective way to track and measure satisfaction — and, of course, use their input to provide more personalized service on your eCommerce store.

When you use journey mapping tools, introduce surveys at the appropriate stages to compile reviews and feedback so you can refine your personalized campaigns even further.

Surveys are easy to automate, and the data you obtain can be invaluable in retargeting your buyers at the right time and place, maximizing your chances for repeat purchases.

Let’s not forget another important detail with using satisfaction for segmentation:

The more satisfied customers you have, the more likely they’ll recommend you to their friends and family. 

Simply put, your data-driven behavior segmentation efforts can also fuel your word-of-mouth marketing and drive long-term growth.

Outside of specific surveys, you also want to track essential customer metrics. Here are just a few customer satisfaction metrics you will want to keep an eye on:

 

1. NPS (Net Promoter Score). This is primarily used to measure growth, discover loyalty, and improve the possibility for customers to recommend your brand. Depending on your customer journey, you can craft NPS questions to pop up at different stages and automate the process for easier data-gathering. Just remember: KISS, or “keep it simple, silly” — customers are more likely to feel frustrated if you ask them to devote too much time to any survey, even when they’re thrilled.
2. CSAT (Customer Satisfaction Score). This metric helps you understand how satisfied customers are with your overall service. You can use it to see how they feel about specific products and the shopping experience itself, payment options, or anything that you are looking to improve at a specific stage of your business development. 
3. CES (Customer Effort Score). The level of effort your customers invest when interacting with your business is a crucial metric to measure. Since your goal is to minimize effort, keep tracking this metric as a way to increase satisfaction, and, of course, boost your NPS and CSAT over time.
4. CRR (Customer Retention Rate). How often do your customers come back to your store? Do they only come back for the discounts, or do they buy items when they’re not on sale? These behavioral patterns can help you tailor your retargeting efforts. If shoppers are much more likely to buy during the holiday season and they actively seek out items on sale, you can boost your chances of retention if you send them each a personalized email offer with Christmas sale items.
5. CCR (Customer Churn Rate). Losing customers is a normal part of the process, but if your churn rate is too high, there might be cause for concern. Look for behavioral patterns and common customer data points that tend to churn. If you can improve their particular experiences, you might be able to leverage some smart eCommerce marketing campaigns to regain their interest. 
6. AOVs (Average Order Values). Although this metric falls under your customers’ purchase history, AOV also gives you a sneak peek into how happy your customers are with your brand. Typically, customers that spend more in your store are more satisfied with your business. 

Be sure to combine these metrics with other eCommerce KPIs to make sense of all this data. Over time, you’ll be able to cross-reference more data points and create even-more granular target groups, which will, in turn, help you personalize your campaigns more than ever.

3. Use Product Browsing History to Boost Offsite Marketing

In addition to your existing customers, you can learn a lot from people who visit your store for some “e-window shopping,” if you will. We know that the more time they spend perusing your store, the more data you’ll have to improve your eCommerce marketing campaigns.

For one, your visitors’ (and buyers’) browsing history can help you understand their preferences. You’ll also gain invaluable insights into the preferences of that particular target group, which will make your retargeting campaigns far more effective for a more significant number of people.

However, it’s by combining browsing history data with offsite marketing that can really lead to more compelling results. 

Let’s take video advertising campaigns, for instance. Advertisers can create more targeted subgroups and deliver more personalized video content by analyzing customers’ browsing history and identifying their interests. 

For instance, if a customer clicks on a video ad showcasing summer shoes, advertisers can use this information to deliver more relevant ads during a sale, which could further pique the customer’s interest.

4. Consider Returning Visitors Separately

This opportunity is one you shouldn’t miss. Why? Returning visitors have a much higher chance of converting into buyers and ultimately offer the best ROAS. 

And with the right personalization strategy, you’ll be able to inspire returning traffic to not only make a purchase, but come back for more — AKA, boosting retention.

Focusing on this segment can help you set up personalized retargeting campaigns that: 

• Provide “on-sale” information specifically related to the items potential customers already liked or that fall into the product categories related to what they’ve looked for or purchased before
• Surprise store browsers with special, personalized offers containing products they love
• Feature a potential customer’s favorite products on your homepage or within ad content

Leveraging returning visitors’ data to boost PPC campaigns can be particularly helpful. You can do this either manually or by investing in a PPC management tool designed specifically for online stores. 

5. Use Cart Abandonment Data

Sometimes, online shoppers are in a hurry, and sometimes they just change their minds. At the very least, people who abandon their carts on your store are goldmines of data you can use to your advantage.

Here are a few ways to infuse your marketing personalization with cart abandonment data:

• Send automated emails to remind shoppers of the items they’ve left behind. If there’s an ongoing sale, let them know how much time they have before those are sold out, or they go back to their full price — both options can work to incentivize a purchase.
• Set up retargeting ads across multiple touchpoints. For instance, using eCommerce social media retargeting by placing customers’ desired products in the ad spotlight is an effective way to entice them to wrap up their purchases.

• Personalize the checkout process by pre-filling their shipping/payment data whenever safe and possible. Making the entire experience seamless and simple will reduce cart abandonment, not just for that customer, but for everyone who comes to your website.
• Offer free shipping or a discount on those particular items. What better way to make it worth their while than to go back to their cart?

Last, but not least, use this data to tweak your entire shopping experience. Remember, if customers leave without finishing their purchases, there might be something you could improve beyond crafting a more personal experience for your shoppers.

Final Thoughts 

In 2023 and beyond, personalizing your marketing campaigns with behavior segmentation is a must. 

With the right data and tools to automate various parts of the process, you can rest assured that the return on your investment will be far greater than the time and budget you put into crafting such campaigns. 

Any favorite personalization efforts that have helped skyrocket your sales and customer loyalty? We’d love to learn about them in the comments!

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Tags: Behavior DataDriven eCommerce Marketing Personalize Segmentation