What is Retargeting and How Does It Work?

If you’re active online, it’s probably happened to you.

Let’s say you’re browsing through a store online, you click on a few things, but ultimately you decide not to buy anything. The next day, you’re scrolling through Facebook or Instagram, or searching for something on Google, and there it is: an ad for the same thing you looked at yesterday.

If this sounds familiar, you have experienced retargeting firsthand. Retargeting is a method of advertising online that purposefully targets people who have shown interest before.

We’ll break down how retargeting works and how you may be able to use it to find new leads, customers, and to improve conversions and ROI for your advertising efforts.

Remarketing vs. Retargeting

Retargeting and remarketing are very often used interchangeably. In general, they are the same concept.

The difference between retargeting and remarketing is small. Retargeting generally refers to redisplaying ads to people online who have viewed your products before. This is usually done through cookies or a pixel on your website; we’ll get into that later.

Remarketing is more specifically about retargeting via email. If someone visits your website and provides an email address, you could remarket your products or services through email marketing or newsletters.

These two terms still mean essentially the same thing; the difference lies only in how you try to bring them back in to convert into paying customers.

How Retargeting Works

Retargeting generally works through two mediums – either a retargeting pixel, or retargeting lists.

Retargeting Pixels

Retargeting is often based on cookies – most websites use cookies to track your activity online. Cookies are small files that hold information about you, your browsing activity, and your behavior on the internet.

Websites that use this retargeting method install a short piece of code on their websites, called a pixel, that drops a cookie when you visit their site.

When you return to the internet, the cookie alerts the business, or more likely their ad account manager, so that a new, retargeted ad can be placed in front of you on social media or on the Google display network.

Often, this retargeted ad will show you the same specific products you viewed before, or it will use language reminding you that you left something in your cart, forgot to complete your purchase, or any copy to try to get you to come back and convert.

Retargeting Lists

Retargeting lists are slightly less automated. These lists are generally made up of people who visited your site and provided information, like an email address. You can use lists of previous customers or visitors to target those who have purchased or shown interest in purchasing your products or services in the past.

You can use your retargeting lists to specifically market to those users whose information you have on different platforms, whether its Google ads, Facebook, Instagram, or another retargeting platform.

Why Does Retargeting Work? 

Retargeting is effective because very often first time visitors to a site are not ready to buy. In fact, research has shown that 96-97% of first time visitors to a website are not ready to purchase – meaning that retargeting is necessary to convert interested potential customers into paying ones.

Retargeting generates sales and profits because it keeps potential customers aware of your brand. Every time your brand is displayed, greater brand awareness and trust is built with the person you’re retargeting, and improved brand recognition can lead to sales.

Retargeting Goals

There are two main goals when it comes to retargeting: improving brand awareness and increasing conversions. Retargeting keeps your brand front and center for those that have seen it before, keeping it fresh on their minds so that they may eventually come back and convert.

Awareness

Brand awareness and recognition is important to build trust, eventually make sales, and hopefully build a loyal client base. When retargeting to build awareness, you may be focused less on customer conversion and sales, however, and more on simply reminding potential customers about your business.

If your retargeting campaign goal is awareness, retarget with ads that are informational. Share announcements, product details, or other info that is more about capturing attention rather than making sales.

When promoting awareness in your retargeting ads, it can be helpful to target specifically those who were not as interested. If some people went to your website for a very short amount of time and didn’t click on much, it may be helpful to target them with ads focused on awareness, since they are probably less likely to convert right away anyway.

Conversion

Conversion is the ultimate goal of retargeting, as the purpose of advertising is to help grow your business and hopefully improve your return on ad spend so that your marketing campaign is profitable.

When retargeting for conversion, make sure that your copy has a clear call to action, and that your ad is CRO optimized. Conversions are more likely to happen with returning customers who have purchased something before, or with those who seemed interested. If they added something to a cart, or stayed on your website for a while and clicked around, it’s more likely that they’ll convert.

Conversion does not necessarily mean sales, so you can also aim for conversions like filling out forms, signing up for a free trial, or any desired goal that takes them one step further into the sales funnel. Ensure that your image, copy, and calls to action reflect what action you want potential customers to take.

Retargeting Best Practices

Your retargeting strategy is dependent on your business, your advertising goals, and various other factors. In general, however, there are ways to improve upon and make the most of your retargeting efforts. We’ve compiled a few tips for the best practices when retargeting.

Retarget by interest. You can segment retargeted audiences so that less interested visitors get different ads than more interested visitors. Send more awareness-based, top of the funnel ads to those who spent less time on your website, and send conversion optimized ads to those who expressed more interest or supplied more information.

Retarget over time. You can choose how long you want a retargeted campaign to run – most ad accounts like Google and Facebook have a default setting of 30 days after the initial visit. You can set parameters for how soon after the initial visit and how frequently you want retargeted ads to be shown. Be careful not to show a retargeted ad too soon – if they leave your website and immediately see an ad, they may feel creeped out or annoyed. You should also be careful not to bombard users with the same ad over and over again.

Retarget existing customers. Customers who have purchased something from your brand before are more likely to purchase again (assuming they had a good experience). Retargeting prior customers can greatly improve profits and conversions on your retargeted ads. While building a new client base is important too, it’s also useful to increase the lifetime value of your existing customers.

Make an offer. Some of the most successful retargeting ads make a new offer to improve conversions. If someone viewed a product but ultimately did not decide to buy it, offering a deal or coupon of some sort in your retargeted ad may get them to come back and make the purchase. Offering an incentive of some sort can greatly improve your retargeting efforts and drive sales.

Conclusion

Retargeting may not be the best solution for every business, but it can be extremely effective for some. Consider whether retargeted ads would work for you, or contact a digital marketing company to discuss your best course of action.