How Analytics Reveals Consumer Behavior

Google’s HEART framework is a well-known methodology for evaluating customer experience.¹ The framework proposes five categories of user experience and behavior—Happiness, Engagement, Adoption, Retention and Task Success—as the basis for gathering measurable data about how customers are experiencing a given product.

The HEART framework is an example of Google’s particular interest in “user-centered metrics.”² More broadly, it’s one of the better-known examples of the increasing importance of analytics in understanding consumer behavior.

In today’s world, businesses rely on data-driven insights to better understand what their customers are doing and what they want. In 2024, Starbucks launched its “Back to Starbucks” campaign.³ Media coverage focused on the campaign’s customer-facing elements, such as a commitment to a four-minute wait time and the return of writing customers’ names on cups by hand. But the initiative was built on the company’s “data ecosystem,” described by Forbes magazine as “a community of embedded analysts and decision scientists who work closely with functional leaders to drive business impact.”⁴

From customer segmentation to purchase behavior data, consumer behavior analytics delivers the information and insights business leaders need to build effective marketing strategies.

This post outlines the core principles of consumer analytics, customer behavior segmentation and other important elements of the study of consumer behavior.

The Fundamentals of Customer Analytics

Customer analytics, or customer behavior analysis, is the study of customer behavior, particularly regarding purchasing decisions and actions.⁵

Companies and organizations typically use customer behavior analytics to develop customer insights and turn them into a competitive market advantage. This entails going beyond basic metrics, such as age or average spend per user, to develop a comprehensive picture of customer behavior. This often includes tracking customers’ journeys across multiple channels and identifying friction and drop-off points (losing customers to an overly complex checkout process, for example).

Consumer analytics and marketing strategy are intertwined, with analytics used to develop strategies and test them through further research and analytics.

Driving Strategy with Customer Behavior Segmentation

Segmentation—dividing your customer base into smaller, focused target groups based on common traits or shared demographics—is often the first step when planning customer behavior analysis.⁶

There are several types of segmentation, many of which can be combined to produce a more detailed snapshot of a section of your customer base. For example, geographic segmentation would group customers by shared location (e.g., the West Coast or Eastern Seaboard). Behavioral segmentation identifies behavioral patterns from purchase behavior data (for example, customers who bought a particular discounted product or shopped on Black Friday).

Marketers can use segmentation to develop targeted campaigns for specific customer segments, aiming to improve overall engagement and conversion rates by making campaigns more relevant.

Leveraging Predictive Analytics for Customer Behavior

Customer behavior analysis is not purely focused on what customers do or have done in the past. Predictive analytics of customer behavior uses statistics and algorithms to forecast future behavior based on extensive analysis of past behavior data.

Weather forecasting is a type of predictive analytics. In the field of consumer behavior, rather than past rainfall or temperature data, marketers might gather sales and pricing information, looking to see how purchasing behavior is affected by fluctuations in product prices. Or they might analyze shopping habits in the back-to-school period versus around Christmas or Thanksgiving. This sort of analysis yields insights that can guide inventory management or promotional planning.

Aligning Consumer Analytics and Marketing Strategy

Ultimately, customer behavior analysis tells marketers how and why their customers are likely to behave under certain conditions. By using techniques such as segmentation and customer profiling, marketers can develop a picture of their customer base. They can then develop campaigns for the segments they have identified, test their reception and refine them based on feedback and further analysis.⁶

This process is further refined and accelerated by the development of AI and machine learning tools that can respond quickly to evolving customer preferences. For example, the Amazon recommendation system is an extremely advanced marketing tool that delivers customized product recommendations to individual users based on purchasing and browsing history.⁷

The proliferation of new tools and techniques, coupled with the ongoing importance of data analysis in driving business decisions, contributes to a growing demand for professionals skilled at translating complex data into strategic action.

Master Consumer Behavior Analytics With William & Mary Mason

Customer analytics drives strategic business growth by providing organizations with the data and tools required to decode consumer behavior and develop actionable marketing strategies to better engage or retain customers.

The Online Master of Science in Business Analytics (MSBA) from William & Mary’s Raymond A. Mason School of Business offers a comprehensive curriculum in the latest data science, analytics, and artificial intelligence techniques and concepts. The 100% online format allows busy professionals to study at their own pace while maintaining career momentum and family commitments. The entire program can be completed in 16 to 18 months, with students in the accelerated program earning the Foundations in Business Analytics Certificate within five months, at no additional time or cost.

The William & Mary MSBA blends technical expertise with strategic acumen to power exceptional careers in business analytics. Students also benefit from the standards and reputation of a “Public Ivy,” the second-oldest institution of higher learning in the United States. Our centuries-long commitment to education is reflected in our outstanding faculty. And, in a recent survey, 78% of MSBA alumni reported they received or expected a promotion within six months of graduation.⁸

Visit our website for a detailed course description and admissions requirements. Or contact us directly with any questions. To discuss how William & Mary can advance your career in business analytics, schedule a call with an admissions outreach advisor today.