Retargeting

Retargeting (sometimes used interchangeably with remarketing, though there are subtle distinctions) is a digital advertising technique that focuses on re-engaging users who have previously interacted with a brand’s online presence. This interaction could be visiting a website, viewing a product, adding an item to a cart, watching a video, or interacting with a social media post. The core goal of retargeting is to remind these users of the brand and encourage them to return and complete a desired action, such as making a purchase, signing up for a newsletter, or downloading a resource.

Key Concepts of Retargeting:

• Re-engagement: The primary objective is to re-connect with users who have already demonstrated some level of interest in the brand or its offerings.
• Targeted Advertising: Ads are specifically shown to users who have previously interacted with the brand’s online properties, making it a highly targeted form of advertising.
• Increased Conversion Rates: By targeting users who are already familiar with the brand, retargeting can significantly improve conversion rates compared to targeting cold audiences.
• Brand Recall and Reinforcement: Repeated exposure to the brand through retargeting helps reinforce brand awareness and keeps the brand top-of-mind.
• Personalized Messaging (Often): Retargeting campaigns can be further enhanced by personalizing ad content based on the user’s specific previous interactions, making the ads more relevant and effective.

How Retargeting Works (General Process):

1. Tagging/Pixel Placement: A small piece of code (a pixel or tag) is placed on the brand’s website or within its app. This code tracks user activity and assigns unique identifiers to visitors.
2. Audience Creation: When a user visits the website or interacts with the app, the pixel or tag adds them to a retargeting audience list. This list is specific to the actions they took (e.g., visited product page X, added an item to cart).
3. Ad Campaign Setup: The brand creates a retargeting ad campaign on an advertising platform (e.g., Google Ads, Facebook Ads, and other ad networks).
4. Targeting the Audience: The brand specifies that its ads should be shown only to users on its retargeting audience list.
5. Ad Delivery: When a user from the retargeting list browses other websites or uses apps within the ad network, the retargeting ads are displayed to them.

Types of Retargeting (More Specific Examples):

• Website Retargeting (Pixel-Based): A user visits a product page on an e-commerce website but doesn’t make a purchase. Later, they see ads for that specific product or similar products on other websites they visit. This is the most common form of retargeting.
• Search Retargeting (RLSA – Remarketing Lists for Search Ads): A user searches for “running shoes” on Google and then visits a sporting goods website. Later, when they search for other related terms like “best-running shoes for a marathon” or “cheap running shoes online,” the sporting goods company can bid higher or show more tailored ads to that user because they know the user has previously expressed interest in running shoes.
• Social Media Retargeting: A user interacts with a brand’s post on Facebook or Instagram. Later, they see ads from that brand in their social media feeds.
• Email Retargeting: A user opens an email from a brand but doesn’t click on any links. They may then see display ads from that brand on other websites they visit. (This is less common due to privacy concerns).
• Dynamic Retargeting: This is a more advanced form of website retargeting where the ads shown are dynamically generated based on the specific products or content the user previously viewed. For example, if a user views a specific pair of shoes, the retargeting ad will feature that exact pair of shoes.

Examples of Retargeting in Action (Detailed Scenarios):

• E-commerce (Abandoned Cart): A user adds a pair of headphones to their online shopping cart but gets distracted and leaves the website without completing the purchase. The retailer uses retargeting to show ads for those same headphones on other websites the user visits, reminding them of the items they left behind and perhaps offering a discount to incentivize them to complete the purchase.
• Travel (Destination Research): A user searches for hotels in Rome on a travel booking website. They then visit several other travel blogs and news sites. The travel booking website uses retargeting to show ads featuring specific hotels in Rome or special travel packages to Italy.
• B2B (Lead Nurturing): A user downloads a case study from a marketing automation software company’s website. The company uses retargeting to show ads promoting a free demo or a consultation with a sales representative.

Benefits of Retargeting (Expanded):

• Recovers Lost Sales: Retargeting is highly effective at recovering abandoned carts and converting users who showed initial interest but didn’t complete a purchase.
• Increases Brand Awareness and Recall: Repeated exposure to the brand keeps it top-of-mind and reinforces brand messaging.
• Improves Customer Lifetime Value (CLTV): By re-engaging customers and encouraging repeat purchases, retargeting can increase the overall value of the business.
• Highly Targeted and Efficient Spending: Retargeting focuses ad spending on users who are more likely to convert, maximizing ROI.
• Personalization Opportunities: Retargeting allows for highly personalized messaging based on previous interactions, leading to more relevant and effective ads.

Challenges and Considerations of Retargeting (Expanded):

• Frequency Capping and Ad Fatigue: Showing the same ads too often can annoy users and lead to ad fatigue. Implementing frequency capping is essential to limit the number of times a user sees a particular ad within a given timeframe.
• Audience Segmentation and Targeting Refinement: Segmenting retargeting audiences based on specific actions or interests (e.g., users who added to the cart vs. users who only viewed a product page) allows for more targeted messaging and improved performance.
• Burn Pixels and Conversion Tracking: Using burn pixels (or conversion tracking) to remove users from retargeting lists after they convert prevents showing ads to users who have already completed the desired action.
• Privacy Concerns and Transparency: Being transparent with users about the use of retargeting and providing them with options to opt-out is crucial, especially in light of increasing data privacy regulations.
• Cross-Device Retargeting: Reaching users across multiple devices (desktop, mobile, tablet) can be challenging but essential for a comprehensive retargeting strategy.

Key Metrics for Retargeting (More Detail):

• Click-Through Rate (CTR): The percentage of users who click on the retargeting ads. Retargeting campaigns often have higher CTRs than initial prospecting campaigns.
• Conversion Rate: The percentage of users who complete a desired action after clicking on the retargeting ads.
• View-Through Conversions: Conversions attributed to users who saw a retargeting ad but didn’t click on it, but later visited the website and converted.
• Return on Ad Spend (ROAS): The revenue generated for every dollar spent on retargeting. This is a key metric for measuring the effectiveness of retargeting campaigns.
• Cost Per Acquisition (CPA): The cost of acquiring a new customer or lead through retargeting.
• Customer Lifetime Value (CLTV) Uplift: Measuring the increase in customer lifetime value that can be attributed to retargeting efforts.

Retargeting is a powerful tool for re-engaging interested users and driving conversions. By understanding the different types of retargeting, how it works, and the key considerations, businesses can effectively leverage this technique to achieve their marketing goals and maximize their return on ad spend. It’s important to balance effectiveness with user experience and privacy to ensure positive results.