What Is Retargeting? And How Does It Really Work?
Here’s a simple explanation of retargeting: You ever browse the web, visit a site then end up on another page but see an ad from the previous companies site you were on? Well that’s retargeting in a nutshell.
With retargeting, a small script is added to the landing page or site controlled by the marketer or publisher, which places a cookie in each visitor’s browser, adding them to an audience list. That audience can now be retargeted with a specific campaign aimed specifically at them.
What Is A Cookie?
So I’m not referring to Oreo, chips ah hoy or the likes in marketing terms a cookie is a small piece of data sent from a website and stored in a user’s web browser while the user is browsing that website.
How Is This Possible? And Why Should I Care?
What makes retargeting especially effective and so powerful is real-time bidding RTB technology, which allows marketers to bid on and purchase individual ad impressions. The purchase of these individual ad impressions is typically based on the previously mentioned audience lists that are composed of people like you and me.
As a result, retargeting campaigns are highly-targeted — yielding higher-than-average engagement — and extremely efficient in terms of ad spend, resulting in lower overall campaign costs. The beauty about it your conversion rates will literally soar. Banner ads usually have a click thru rate of 0.91% with retargeting I’ve seen my click thru rates jump to 4%.
5 Ways To Take Advantage Of Retargeting.
There are multiple reasons why retargeting is so powerful, especially for performance-driven marketers, and for brand marketers, as well:
1. Second Chance To Convert A Visitor
What makes retargeting especially powerful is the fact that it only targets users that have visited one of your websites or landing pages. This means these visitors have already been exposed to your brand and very likely your product or service. As a result, these visitors are more qualified and likely to be persuaded by continued marketing.
If the majority of your traffic is made up of one-time visitors, paid or organic, that would have otherwise gotten away, retargeting allows you to continue marketing to those visitors to get them back into the conversion funnel.
For example, a pay per click search campaign, where an advertiser is bidding on a high-cost vertical like mortgage or insurance. When the visitor clicks the ad, the advertiser gets charged and is given basically one chance at converting that visitor. Sucks doesn’t it, well not anymore.
Now with retargeting, you have a second chance to put the user back into your lead funnel and convert them again.
2. Build An Asset By Capturing Your Audience Data
Retargeting is the perfect complement to SEM and SEO efforts. If you already have a steady supply of organic visitors coming to your site, you should leverage that traffic into your own retargeting list. This is especially useful if the majority of your traffic is made up of one-time visitors that would have otherwise gotten away.
Likewise, any ad campaign that you have running is an opportunity to build an audience, so placing a retargeting pixel on your landing pages is only natural. By building an audience in addition to your primary campaign, you get to create a valuable asset from your ad spend, much like a mailing list. This is a great way for marketers to derive long-term value from their campaign budgets.
I find personally that using retargeting to build an email list is literally a gold mine waiting to be explored.
3. Create Illusions Of Importance
It is of great importance to understand that retargeting is far more than just a performance or conversion-focused tactic. It plays a major role in building brand awareness among your target audience, even if the end result isn’t a short-term direct conversion.
4. Stellar Campaign Performance
As we touched on earlier, a retargeting campaign, which only purchases impressions for individual users, means a cost-effective campaign. From a marketer’s perspective, this can translate into high ROI. In fact, many people consider retargeting to be the “cream of the crop” tactic in display advertising when it comes to ROI, however, attribution models can often muddy the waters (a topic for another day).
Furthermore, because of the increased level of targeting, engagement is also typically higher. It’s not uncommon to see amazing CTRs with retargeting, anywhere from 0.30-0.95% – which is 3-10x higher than the industry average. In some cases they are even higher. In the display advertising world where you’re paying by the impression, having a high CTR like this makes all the difference.
5. Up-Sell, Cross-Sell Or Onboard Converted Visitors
By placing a retargeting pixel on conversion or “thank you” pages, you can build an audience list of high-value users. If they’ve converted before and you have another compelling offer, there is a good chance they will convert again.
Audience lists of converted users are typically used for exclusion from continued and unnecessary marketing (it only wastes ad spend and causes negative sentiment). But, if used in creative ways — like onboarding new users or offering complementary products and services — even more value can be extracted from your retargeting campaigns.
They say you never get a second chance to make a first impression. With retargeting, you not only get a second chance, but a third, fourth, fifth and more.
In the highly competitive world of digital marketing, you want to utilize every advantage possible and maximize the value of each of the visitors you drive. In the case of retargeting, you are leveraging your own first-party audience data, which, as we’ve discussed before, is the most valuable type of audience data.
This is what makes retargeting so compelling and why its use should be a part of every marketer’s strategy.