1) Demographic - This is a set of characteristics like gender, age, marital status, geographic location, socio-economic status, etc. It provides enough information to create a mental picture of the typical member of the hypothetical group. For example, a marketer might speak of the "single, female, middle-class, age 18 to 24, college educated demographic."
2) Behavioral - This type of profiling is more concerned with what the customer is actually doing. It cares only about customer activity. This is infinitely more important than demographical information.
The first is pretty typical and any crm can store information like age, address, and even supply custom fields for information like socio-economic status (perhaps in the form of a "score" or comparative rating). When it comes to behavioral data, some web tagging system makes this achievable.
What are customers doing? When's the last time they've engaged with my website? How long have they gone without purchasing? How long have they gone without clicking on a link? Will they visit again? Will they buy again? These are the questions answered by collecting and analyzing behavioral data.
Simply put - customer behavior is a much stronger predictor of your future relationship with a customer than demographic information will ever be.
Granted, demographic profiling is useful if your business relies on selling advertising. But even then, the behavioral profile trumps it because if the customer stops visiting your site or interacting with you, you're not going to have eyeballs to serve ads to, no matter how personalized or customized to the visitor's demographic profile the ads may be.
Customer modeling is probably a better word for the latter profile because it is action-oriented. Models aren't about "set-in-stone" characteristics like "my customer is a female between the age of 18 and 24." Models are about actions over time like, "If a customer does not make a purchase in the next 30 days, they are unlikely to come back and make any further purchases." That's a model.
Modeling seeks to look at customers who are engaging in a certain behavior and tries to find a commonality in them.
The real power comes in combining both demographic and behavioral data to produce an even crystal clearer picture of the customer. Just remember that if you must choose, always go with behavior. If you've got finite dollars and one company offers to analyze and compile the demographics of your customer base versus another analyzing behavioral trends and actions, go with the latter.
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