Behavioural Targeting: Meaning, How It Works And Benefits

By Indeed Editorial Team

Published 28 September 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Behavioural targeting is a marketing tool with which a company shows advertisements to those internet users who may search for a type of product that the company is selling. For this marketing tool to work efficiently, it relies on the web browsing behaviour of a user. Learning about this process can help you understand how it works and how companies employ it to increase the success rate of their ad campaigns. In this article, we describe what behavioural targeting is, outline some steps to examine how it works and share some benefits of this marketing process.

What Is Behavioural Targeting?

Behavioural targeting is a technique in advertising that helps companies to target customers effectively. This targeting relies significantly on the users' online behaviours, like what they buy, what websites they use to buy the products or what search queries they write to shop online. For instance, there is a user who plans to buy a shirt, which they saw on an e-commerce website. Now that the user has visited the website and the shirt's webpage, the company may show them ads on other websites as well. This helps the company to increase the likelihood of the user buying a product.

If a company chooses geo-targeting for users, it may specify exactly what visitors can see on which version of the company website. For instance, an e-commerce company's homepage shows a new offer on sunglasses when a user visits the page using the search term 'sunglasses'. If the user has arrived on the page via a social media website, then the company may show the user the widget of that social media website. A web user's browser, search keywords, ads they have clicked and buying history are some other components of their web usage data.

Related: Consumer Decision-Making Process: Definition And 5 Stages

How The Behavioural Marketing Method Works

Below are three steps to help you understand how this behavioural marketing tool works:

1. Gather data

Gathering data is the first step in the process where a company collects this data from multiple sources. These sources include customer relationship management (CRM) systems, websites, mobile applications and various other marketing automation methods. Here are the data types that a company may collect:

  • Frequently visited web pages: A company may monitor what pages a user is visiting once, repeatedly or routinely.

  • Website viewing time: When companies determine the time a user spends on a website, they are better able to recognise the user's interest in a specific product or service.

  • Clicked ads and links: When a company runs an online ad campaign, it can determine when a user clicks the ad or a link, helping advertisers to know what elements of the ad are appealing the most to visitors.

  • Web page element interaction: The way a visitor browses a website may tell a company about the elements that the visitor is interacting with the most, like images, videos or social media tickers.

  • Transaction progress: A company knows when a user places an item in their shopping cart, which helps the company to find out if the user has completed the checkout process, further allowing the company to target the user with more product ads.

  • Amount of time between visits: A company may also determine the duration between visits to its website, and if the company notices that these intervals are short, it may conclude that the user has a strong requirement for the company's product or service.

Related: The Difference Between Consumer Vs Customer (With FAQs)

2. Divide visitors into segments

Visitor segmentation is the second step in this process. A company may divide its customers into varied segments. These segments may be based on a browning behaviour or purchasing behaviour. For instance, there is an e-commerce website that sells different kinds of mobile covers and cases. The company may put users exploring cases for five-inch smartphones in one category and users checking out cases for six-inch phones in another category.

Related: Audience Segmentation: Definition And Comprehensive Guide

3. Apply the data

Application is the last step, where a company may develop targeted campaigns. These campaigns may be based on the segments they have prepared for its reference. This helps the company to prepare marketing campaigns that apply to the users they are targeting. With such strategic campaigns, a company personalises marketing for its customers and prospective buyers, along with increasing the likelihood of user engagement, which may finally lead to a conversion.

Related: Buying Signals: What They Are And Why They Are Important

Benefits Of Targeting Consumers Based On Their Behaviour

Here are some benefits of targeting consumers based on their behaviour:

  • Increased user engagement: With this targeting based on user behaviour, a company may focus on the habits of consumers. When consumers see ads that apply to their interests and browsing patterns, they are more likely to interact with those ads.

  • Higher click-through: Companies make strong efforts to create and share ads that align with the interests and purchasing behaviours of users. When users see such ads, the possibility of them clicking on these relatable ads increases.

  • Improved conversion rate: Advertisements that reach a behavioural target market usually appeal to most consumers who view them. Upon seeing such ads, a user may search for more information about the product or service or make a purchase.

  • Enhanced experience: When users come across personalised advertisements, they may find the browsing experience more satisfying. This enhanced browsing experience may ensure visitors or consumers find advertisements meaningful.

  • Higher sales: Companies that employ this behavioural marketing tool usually witness higher sales. With this tool, they may efficiently send product-related alerts to consumers or send notifications whenever a consumer is not taking action on their cart items, reminding them to make a purchase.

Related: A Comprehensive Guide To The Importance Of Marketing

Disadvantages Of The Behavioural Marketing Tool

Here are some disadvantages of the behavioural marketing tool:

Privacy

Behavioural marketing may often result in highly personalised advertisements, but this type of marketing may also be a subject of disapproval. There may be numerous people who disagree with its feature of collecting private data. There may be many people who also feel that they do not have firm control over how companies collect their data.

Exploitation of data

As the scale of collecting personal data is large, security advocates may often suggest that this may cause potential security risks. There may be external breaches or a private data trade on a major scale. If these violations occur, private data of people may get compromised, which may hamper the privacy of internet users and cause significant security concerns.

Related: How To Use Incognito Mode (And Other Internet Browsing Tips)

Behavioural Vs Contextual Targeting

In contextual targeting, a company shows ads that apply to the web page content that a user is viewing. If a visitor visits a blog that shares music lessons, then an advertisement for a musical instrument becomes an example of contextual targeting. In this type of targeting, a company may not possess any web user data, which makes the advertisement only relevant to the content of a web page. With the behavioural marketing tool, an organisation seeks user data to show them ads based on their specific actions. Below are reasons to employ the behavioural marketing tool over contextual targeting:

Retargeting

With behavioural marketing technology, an advertiser can show one advertisement to a consumer on different websites. For instance, if a consumer has explored some history books on a book-selling website, then the company may show them advertisements for those history books on other websites that they access. This is an advertising strategy to expose the user to a product or service multiple times. This constant reminder to a consumer may help a company increase the likelihood of a sale.

Personalised advertising

Personalising advertising means showing advertisements that are inspired by the user's activity on the internet. These ads usually match a consumer's browsing patterns and preferences. With personalised advertising, a company may possess higher conversion rates, along with offering users an enhanced online shopping experience.

Related: What Is Online Advertising? (With 9 Types And Advantages)

Consumer Data And Cookies

Cookies are data that are associated with how website visitors interact with websites. There is a lot of information that cookies can provide, like the pages that the user visited, the browsing duration or the user's location. A company may utilise cookies to ensure the marketing initiatives are effective.

Smartphones also store cached data that a company may utilise to monitor user behaviour. There are several applications on a smartphone that may collect data about a user's communications, purchases, search history, navigation records, locations and check-ins to collate the data for analysis.

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