Why behavioural targeting is better than previous purchase targeting

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With many products and services once you have purchased one particular product you won’t need it again. For example if I buy a big TV I am not going to buy it again and if I holiday in the Sahara desert one year it is unlikely I will want to go there next year (unlike those of us which get our 7 days sun in Spain).

Also, if I buy from a particular product category – say a book – does this mean I am only going to buy books from a company? Clearly not as next time I might come back and buy a CD. But targeting around this purchase would mean you would be focussing on books.

And this is the main problem with targeting around past purchase – you are essentially trying to shorten the odds on what is most appropriate, and in effect you are having an educated guess. A prime example of this strategy can be seen in the Amazon emails which are considered the standard bearer  in targeting. However after buying a huge monitor cable from Amazon they followed up with a few emails around other monitor cables and accessories – aspirational stuff!

But why make an educated guess when you can target based upon what customers are actually searching for?

We have recently launched a targeted email programme for a travel organisation which takes a feed from their analytics tool of what holidays visitors have been searching for on their site. We then target these visitors with emails containing the best selling holidays that meet their search criteria for the next few weeks while they make their decision.

This increases the relevance in several ways:

  • Timing – this is crucial in travel as it is an infrequent purchase which people will spend several weeks thinking about before booking. Therefore you can increase the frequency of messages during this time as it is relevant and front of mind
  • You can also get a more accurate understanding of what interests someone by looking at what they actually search on, even if they make an enquiry about a particular product. In this example a holiday can be an adventure holiday but also perhaps a family holiday. So which one is it, as this impacts on how you tailor your messages? By looking at what the user actually searches for we can see which it is.

Initial results show these targeted emails achieve open rates of 55%, click rates of 25% and an increase to enquiry of 63.5% compared to sending generic emails. Pretty impressive stuff!

Of course there are other segmentation strategies that might be applicable and past-purchase activity is still useful, particularly for cross-selling and in industries where repeat purchase is important. But you will be hard pressed to find a method of targeting that gets results better than this.

About Craig Loynes

Marketing Manager at Emailcenter, the UK's largest independent ESP. Connect with +Craig Loynes on Google+ or follow on for more email marketing insights.

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