Behavioral segmentation: A powerful tool for SaaS success

Have you ever played an online game? What if you're running a game, and everyone keeps quitting early? Frustrating, right?  

Wouldn't it be better if you understood why they were leaving?

That's what behavioral segmentation is like for SaaS companies.  

Instead of players, it's customers using your software. By figuring out how they interact with it, you can improve the game (or software) for everyone!

This story isn't just about understanding customers, though. It's about using that knowledge to win! 

So, what can you do with this newfound knowledge? Everything! 

Here's a comprehensive blog on behavioral segmentation in SaaS, including how Usermaven can help in this process:

What is behavioral segmentation?

Behavioral segmentation is a marketing strategy that divides customers into groups based on their actions and interactions with a business. This can include things like:

• Purchasing habits (how often they buy, what they typically buy, how much they spend).
• Brand interactions (how they engage with your website or social media, whether they attend events).
• User behavior (how they use your product or service).

By understanding how different customer groups behave, businesses can target their marketing messages and offerings to be more relevant and appealing. This can lead to increased sales, customer satisfaction, and brand loyalty.

Why is behavioral segmentation key for SaaS?

Traditional segmentation methods often rely on demographics like age, location, or income. While this information can be useful for initial targeting, it doesn't tell the whole story.  

If you are trying to understand your customers by looking at their age or device type. It might give you a general idea, but it wouldn't tell you their favorite hobbies, what annoys them, or the kind of movies they like. That's the limitation of traditional segmentation methods based on demographics.

For this reason, behavioral segmentation goes beyond basic attributes and dives into how people actually interact with your product.

Behavioral segmentation shines in:

1. Discovering the "why" behind user behavior

Let's say you run a project management SaaS platform. Behavioral segmentation allows you to see how different user groups interact with your features. 

You might discover that some teams heavily utilize task assignment tools while others primarily focus on communication features. 

This actionable insight lets you understand why users choose your product and what parts they value most.

2. Speaking the right language to each user

The worst-case scenario you could imagine would be bombarding new users with advanced tutorials or sending discount offers to highly engaged customers.

Behavioral segmentation helps you avoid such misfires. You can create targeted communication that resonates with each user segment. 

New users might receive a series of onboarding messages that guide them through the platform's basics. 

Disengaged users, on the other hand, could get win-back campaigns highlighting features they haven't explored yet.

3. Making your SaaS feel like a custom fit

Isn’t it amazing if your users felt your SaaS platform was built just for them? 

Behavioral segmentation allows you to personalize the user experience. 

For instance, a design software platform could recommend relevant templates or tutorials based on a user's design style and most used features. 

This tailored approach fosters a sense of connection and keeps users engaged.

4. Building what your users actually want

Stop guessing what features your users need! 

Behavioral segmentation reveals which functionalities resonate with different user segments. 

This allows you to prioritize development efforts and ensure your product roadmap aligns with your users' values. 

Usermaven improved its AI insights by providing a tool named Maven AI. Based on people’s interests and likings, now it can provide more precise and insightful data regarding analytics of your website and product. 

5. Saving customers before they say goodbye

Behavioral data can be a lifesaver when it comes to customer churn. 

By identifying users who exhibit signs of disengagement, like infrequent logins or lack of feature usage, you can take proactive steps to improve their experience. 

Targeted support interventions or exclusive offers might be just what they need to rediscover the value your SaaS provides.

Strategies of behavioral segmentation

There's no one-size-fits-all approach to behavioral segmentation. However, here are some common strategies to consider:

1. User engagement

Categorize users based on login frequency, feature usage (e.g., active users of a specific tool), or completion of key tasks (e.g., completing a project in a project management platform).

Identify your "power users" who are highly engaged and reward them with exclusive features or loyalty programs. Re-engage less active users with personalized outreach campaigns that address their specific needs and usage patterns.

2. User Journey

Divide users based on their progress through the product's functionalities. Track where users drop off and identify roadblocks that hinder their journey.

Analyze user Journeys to pinpoint drop-off points. For example, you might segment users who haven't completed a crucial onboarding step, such as setting up their profile, and provide them with targeted in-app guidance or helpful walkthroughs.

3. Goal completion

Group users based on their success in achieving specific goals within the product. This could involve completing projects, generating reports (e.g., in a financial SaaS platform), or collaborating effectively with team members.

By understanding goal-oriented behavior, you can identify users struggling to achieve their desired outcomes. And offer them relevant support, such as targeted tutorials or personalized recommendations, to help them overcome roadblocks and achieve success.

Related: Conversion Goals in Usermaven  

4. Feature Adoption 

Categorize users based on their adoption of specific features. This helps you understand which functionalities resonate most with different user groups and identify areas for improvement.

Analyze Feature Adoption rates to see which features are underutilized. You can then target users who haven't adopted a particular feature with in-app tutorials or highlight the benefits of these functionalities through targeted messaging and showcasing success stories relevant to their usage patterns.

Putting behavioral segmentation into action

Now that you understand the power of behavioral segmentation, here's how to put it into action:

1. Identify your goals

Define what you want to achieve with segmentation. Do you want to improve onboarding, increase feature adoption, or reduce churn?

2. Data collection

Leverage product analytics tools to capture user behavior data. Track user actions, feature usage, and engagement metrics.

3. Segmentation criteria

Choose the segmentation strategy that best aligns with your goals. Consider a combination of user engagement, feature adoption, and goal completion for a well-rounded view.

4. Actionable insights

Analyze the data to identify user segments with distinct behavioral patterns.

5. Targeted communication

Develop communication strategies specific to each user segment. Craft email campaigns, in-app messages, and support resources tailored to their needs and behaviors.

6. Personalization

Personalize the user experience within your product based on user segments.

Advanced techniques of behavioral segmentation

As you gain experience with behavioral segmentation, you can explore advanced techniques:

1. Cohort Analysis

Group users based on shared characteristics, such as signup date or acquisition channel. Analyze their behavior over time to identify trends and measure the effectiveness of marketing campaigns.

Related: Cohort Analysis: How to measure user retention? 

2. Predictive analytics

Leverage machine learning to predict user behavior and identify at-risk customers. This allows for proactive interventions to prevent churn.

Understanding user behavior with Usermaven for SaaS

Usermaven empowers you to unlock the secrets of user behavior through powerful behavioral segmentation. Imagine understanding your users on an individual level, anticipating their needs, and delivering experiences that resonate deeply. This is the power that Usermaven puts at your fingertips.

1. Effortless access to user segments

Accessing your user segments in Usermaven is a breeze. Simply navigate to the "Contacts Hub" on your dashboard and select "Segments" from the left-hand panel. There, you'll find a central location for all your segmentation needs, allowing you to organize and analyze your data with ease.

2. Flexible segment creation tailored to your needs

Usermaven offers two intuitive methods for crafting user segments. You can leverage filters within the "Contacts Hub" to target specific user groups based on various criteria.  

For instance, filter by user type (e.g., all visitors, users, or companies) and apply additional filters to narrow down your audience further. Once you've defined your ideal user group, simply hit "Save as a Segment" to preserve it for future use.

Alternatively, you can create segments directly from the "Segments" section itself. Click the "+" button and unleash the power of Usermaven's segmentation engine.  

Here, you can construct intricate segments using a combination of "AND" and "OR" filters. This allows you to target highly specific user groups, such as administrators on the Pro plan who haven't completed a particular action.

3. Advanced filtering options for deep user insights

Usermaven goes beyond basic filtering by offering a suite of advanced options to truly understand your user base.  

Refine your segments with the "Refine" option (available for events), enabling you to target users based on event frequency within a specific timeframe. Imagine identifying users who haven't logged in for 30 days or those who haven't completed a key action multiple times in the last week.

4. URL filtering 

Usermaven's URL filtering clarifies user behavior across your website. You can target users based on the specific web pages they've visited, allowing you to engage them at precisely the right moment. For example, you can identify users who visited your pricing page but didn't convert.  

After that you can reach out with a personalized message addressing their potential concerns and follow them towards a subscription.  

Here's an example of how you might use Usermaven for behavioral segmentation:

You want to understand how users interact with a new onboarding tutorial. Usermaven can help you segment users who have completed the tutorial compared to those who haven't. 

Analyzing their behavior can help you identify areas for improvement in the onboarding process.

The bottom line

Behavioral segmentation enables you to understand user behavior more precisely and genuinely. It can lead you to improve your product based on segmentated data of user’s behaviors and experiences.

Keep checking and improving segments to keep them effective.

Usermaven's segmentation provides valuable insights for smart decisions and better user experiences, driving business success.

FAQs

1. How often should I update my behavioral segments?

User behavior can change over time. It's important to revisit and update your segments regularly to ensure they continue to reflect your user base accurately.

2. Can behavioral segmentation be used for marketing outside the SaaS platform?

Absolutely! Insights from behavioral segmentation can inform your broader marketing strategy. For example, you can tailor email campaigns or social media content based on user segments.

3.  What other segmentation methods can be used alongside behavioral segmentation?

Behavioral Segmentation is powerful, but it can be even more effective when combined with other methods. Consider incorporating demographics, firmographics (company-based data), or psychographics (user attitudes and values) for a more well-rounded understanding of your customer base.