• by Steve Smith , Staff Writer @popeyesm, November 9, 2007

When offline audience research company Experian recently acquired online traffic analytics service Hitwise, there was an obvious marriage waiting to happen between offline data and online tracking. Experian's renowned MOSAIC segmentation system categorizes psychographic and demographic groups, while Hitwise follows audiences as they course in and out of hundreds of thousands of Web sites. As Hitwise president Chris Maher tells us this week, the two products now combine in Hitwise Lifestyle, which promises companies deeper intelligence about how their and their competitor's customer target markets behave online.

Behavioral Insider: Explain the Hitwise method for gathering online traffic data, which is different from the panel-based approaches.  

Chris Maher: We analyze a sample of 25 million Internet users globally. In the U.S.,  that sample is ten million people. We do it predominantly through relationships with ISPs and supplement it with opt-in panels. We analyze their online behavior every day. That allows us to report on their interaction with upwards of a million Web sites. We organize and categorizes those Web sites across 170 or so industry categories. It is a different methodology. We can report not only monthly but also weekly and daily.

Behavioral Insider: How does the MOSAIC segmentation get layered onto that?

Maher: We are taking their offline MOSAIC data and mapping that across our online sample to create lifestyle or socioeconomic, behavioral and demographic information for online. It classifies U.S. households to provide insights into their behaviors and culture at a household level.

The way they do this is through building these MOSAIC clusters. They have 60 segments and then those roll up into 12 groups with neat names like ‘young cosmopolitans...' based on over 300 demographic variables on things like age, ethnicity, household size, education levels, etc. The granularity of lifestyle or psychographic traits and behavioral traits around households is very detailed. One of the variables is the zip+4 address, which we have for the majority of our online samples. So we have a number of data points that we can append the MOASAIC sample to online behavior.    

Behavioral Insider: If it is zip+4 then, you are able to map MOSAIC against region, but not person.

Maher: The way we do it is at the household level, so it is not down to an individual level. So we don't capture personally identifiable information. That is the way that MOSAIC does it offline.

Behavioral Insider: How does the MOSAIC data work in tandem with the kind of site research Hitwise already does?  

Maher: We are able to provide a breakdown or map that segmentation system with the 60 segments roiled up into the 12 groups onto our online users behaviors. So you can search our database and identify, say, where the young cosmopolitans spend their time online. They are young, white collar urban professionals who tend to be very tech-savvy and digitally driven, and like to do exotic vacations. If that is a target audience for you, you can find out through using our Lifestyle MOSAIC tool where that population spends time online. But you can also compare your own audience or customers to a competitor and then identify where there are overlaps and gaps.

Behavioral Insider: What are some practical applications of that sort of analysis?

Maher: If I am a retailer and I want to understand what sort of segments or groups are spending time visiting my competitor, I can do a comparison where there is overlap and where I am competing but also where they are getting a greater share of a group that I think may be attractive to me. It is also interesting for identifying trends and early adopter sorts of thing. So if you take that young cosmopolitan group that tends to be that under- 35, tech-savvy, single, Internet-savvy, and digitally driven demographic, we have noticed over time that they tend to be the early adopters and the ones that are really spotting trends early on in the business cycle. And so that's another way our customers are leveraging this type of information. And it is all about digging deeper into the lifestyle or the background of their customers to understand more about their behavior online, as well as understanding their behavior offline.

Behavioral Insider: Give me some examples of tracking behavior offline and online. Can the offline research approach the real-time dynamics of online?

Maher: I think this offline data is updated on an annual basis. But the important thing there is that those offline profiles, for instance a young cosmopolitan, has a lot of info about their lifestyle. Where we take it to another level with the MOASIC system is, you can break down aspects of these groups so you can search on specific details.

It is one thing to say where the young cosmopolitan is spending time online, but let's take that to a deeper level and let's look at things like how those people make their living, where they live, what are their lives like and how they view the world. What is their media consumption? What segments within the system have a graduate degree or higher? We may want to know if they are using online banking sites, how frequently they make online purchases? There is political affiliation stuff. That is where out clients have driven us -- to really get what we call behavioral segmentation, to learn more and more about the details of the background of the online and offline behavior of your customers - or, more importantly, of your competitor's customers.