What is Retargeting and How it Works

The vast majority of people that visit a website leave without buying anything.

People typically need multiple encounters before becoming a customer. The marketing rule of seven states that it takes an average of seven interactions with a brand before a customer converts.

While this rule was developed in the 1930s, it’s also applicable for online marketing campaigns.

So, If you want to maximize your business’ success, you need a way to bring your visitors back to your site and one of the best marketing tactics to do this is retargeting.

Retargeting is a powerful and cost-effective channel. Retargeting campaigns are very easy to set up and can be fully automated.

All kinds of businesses regardless of what other channels they use to reach their target audience should use retargeting in their marketing strategies.

In this guide, we will start with a definition of what retargeting is, explore the different retargeting types, and explain how retargeting works.

What is Retargeting?

Retargeting is a type of paid advertising where you show ads to people that have previously visited your website or who are already familiar with your brand in social media networks.

Let’s say a user lands on your site after finding you through Google. They browse a few pages before eventually leaving the site.

With retargeting, you can create ad campaigns that display ads to this user. These ads appear across different web properties depending on the retargeting platform that you are using.

Retargeting allows you to do this by tracking the visitors that come to your site and the actions that they take.

Because of this, you can get very specific with your ads and campaigns by targeting a certain segment of visitors that performed a particular action or viewed a certain page.

The goal of retargeting is to engage with people that are interested in your business, eventually bringing them back to your site to become a customer.

While retargeting lets you target specific audience segments based on certain characteristics, it should not be confused with other types of targeting in marketing, particularly behavioral and contextual targeting

Retargeting Vs Behavioral Targeting

Behavioral targeting is a method in which you use a variety of sources to gather data on your target audience’s browsing and buying behavior.

With this information, you can create ad campaigns that are highly relevant to your audience, based on their specific habits and interests.

Retargeting Vs Contextual Targeting

Contextual targeting is a strategy where you display ads on websites that are directly relevant to the product or service featured in the ad.

For example, if your business sold workout clothes, you could use a contextual targeting strategy to place ads on fitness blogs.

By targeting based on context, your ads are more relevant to users viewing the page.

The Benefits of Retargeting to Businesses

The biggest benefits retargeting can bring to your business are:

• More sales
• Improved ad performance
• Better brand awareness
• Faster buyer’s journey

More sales

The most direct benefit of using retargeting for your business is higher sales.

No matter what industry you operate in, the vast majority of your website visitors won’t turn into sales on the first visit.

It takes repeated visits before most people will buy from a business for the first time.

As such, your business needs a way to continually engage with people that visit your site to bring them back to eventually make a purchase.

Retargeting ads give you a highly efficient way to do this.

By running retargeting campaigns, your business will experience more sales than if you let visitors come and go without making an effort to market to them again.

Improved ad performance

Retargeting ads are one of the most effective types of ad campaigns. They tend to have notably higher conversion rates than top-of-the-funnel ads because the prospects are warmed up, having already engaged with your business.

With better conversion rates, retargeting ads also lead to a higher return on investment (ROI) for your campaigns as you are able to get more out of your marketing spend.

Another way retargeting can lead to improved ad performance is by giving you the ability to use highly-targeted creative based on users’ previous actions.

Better brand awareness

People are inundated with messages from businesses everywhere they go. While you might have been able to get through to someone with a single ad in the past, today you will typically need multiple interactions with a person before they will really remember your brand.

Retargeting speeds this process up by getting your business back in front of your previous visitors within a short time frame of first interacting with your business.

These people may not turn into sales after a second or even a third visit. But eventually, when it comes time for them to decide on a purchase, your brand will be top of mind.

Faster buyer’s journey

Retargeting helps to reduce the overall time it takes to move people through your digital marketing funnel.

It does so in a few ways. For one, it lets you get back in front of people immediately.

Additionally, with retargeting, you can send highly relevant ads to people based on where they are in the buyer’s journey.

By giving people what they need when they need it, you remove friction from the process and increase the chances they become a customer.

How Retargeting Works?

Here is a quick overview of how retargeting works:

1. Visitors enter your website from multiple sources (Google search, paid ads, social networks, direct visits, etc)
2. The vast majority of them leave your website without taking an important action
3. By adding the proper tracking code on your website, advertising platforms (like Facebook and Google) can associate website visits with user accounts on their platforms
4. Through retargeting campaigns, you can segment and target your audience with ads
5. As a result, many of them will come back to your website and some of them will convert

Pixel Based Retargeting

To retarget, you first need a record of the people that interacted with your business. It is also important that you know the specifics of their experience such as what pages they have visited, how much time they spent on the site, what products they’ve bought, and so on.

The most common way to gather this data is to use a pixel.

The pixel is a tracking code installed in the backend of your website. This code uses small pieces of data known as cookies to remember the users that visit your site.

The cookies are stored on the person’s web browser. As the person views other websites, the cookies will notify the retargeting platform.

This can trigger the platform to show the person your retargeting ads.

Whether or not they show depends on the specifics of your retargeting campaign.

With pixel-based retargeting, you are displaying your ads to anonymous people as you do not have the person’s name or contact details.

Retargeting Lists

Another way to retarget your visitors is to use a retargeting list.

With a retargeting list, you build a list of specific people to target in a campaign.

For example, you could export a list of the email addresses of your previous customers from your CRM.

You can then upload this list to a retargeting platform like Google or Facebook to use as the audience for a campaign.

The platform will identify users that share the contact information from your list. It will then display your retargeting ads to the users.

Using a list takes a little longer than targeting off of pixel events as you need to take the time to gather and upload the list.

That said, list-based retargeting can be used to create highly targeted ads as you can control every single person to include in the audience.

How to Get Started With Retargeting

Now that you understand how retargeting works, let’s see how you can get started using it for your business.

1. Create a retargeting strategy
2. Choose your retargeting platforms
3. Add tracking to your site
4. Create your retargeting ads

1. Create a retargeting strategy

Like any marketing endeavor, you want to start with a strategy.

To create an effective retargeting strategy, you first need to determine your goals for the ads.

Once you’re clear on where retargeting fits into your overall digital marketing strategy, you can begin planning the retargeting campaigns that you will use to reach your objective.

Each campaign must have a goal. Retargeting ads can be used to serve a variety of purposes so it’s important to set a direction for each campaign to ensure that your ad creative and targeting are properly aligned.

Below are some of the goals you can set for your retargeting campaigns:

Growing awareness – With an awareness campaign, you can retarget previous site visitors to help keep your brand top of mind.

As I’ve stated, it can take a couple of interactions before you move someone from the awareness stage to the consideration stage of your funnel, and retargeting is a quick and effective way to do that.

Ads for an awareness retargeting campaign are typically more generic as you are targeting a broader audience and people of which you are yet to get behavioral data.

Nurturing leads – Retargeting campaigns are useful for moving your prospects through the buyer’s journey. You can use them to ensure that each person is receiving advertisements specific to their interests.

Conversion and sales – This type of campaign is simple. You want the users that click on your retargeting ads to buy from your business.

With this type of campaign, you’ll want to use a landing page optimized for sales conversions.,

Bringing back previous customers – Another goal you can set for your retargeting campaign is to bring old customers back to your site to buy from you again.

If you have new products or services, you can highlight them in your ads. By using your customer data, you can ensure that the person is only seeing content relevant to them.

Reducing cart abandonment – An abandoned cart is when a customer adds items to their cart but leaves your site before completing the order.

It is an unfortunately common thing and a major loss of revenue for many eCommerce businesses.

Retargeting can help lower your abandoned carts by reminding people to come back to your site.

With a retargeting campaign, you could send hyper-specific ad creatives showing the items that the user had in their cart.

You could even offer a discount as a means to get them to complete the order.

2. Choose your retargeting platforms

The most effective retargeting platforms are:

Facebook Ads

Facebook Ads retargeting offers some of the most extensive retargeting features among advertising platforms. It also has the advantage of a massive audience and extensive data on user behavior.

Facebook Ads affords a variety of ad formats. Many are visually appealing which helps to create an engaging experience for your audience.

To retarget on Facebook you need to create a Custom Audience that includes the past visitors you want to include in the campaign.

You can create your audience using data from the Facebook Pixel or your own list. Once you create a Custom Audience, any subsequent web visitor that the pixel tracks will automatically be added to the audience.

Google Ads

Google is another crucial retargeting platform given the scope of its audience and the breadth of its retargeting features.

Like Facebook, Google offers a variety of ad types and uses a tracking code to collect data on visitor behavior.

You can retarget past visitors using display retargeting ads. These are shown across the Google Display Network, a collection of millions of sites that make up a big chunk of all the internet.

You can also use your Google Shopping product ads in a retargeting campaign.

With Google, you can create custom remarketing lists for people that performed specific actions. You can then use these segments in your retargeting campaigns.

AdRoll

AdRoll is a platform that you can use to manage retargeting campaigns across a variety of different marketing services. This includes Google, Facebook, Microsoft, Yahoo, and over 30 others.

The service gives you a centralized place to manage your ads and provides some other features to help you get good results.

Adroll using a CPM pricing model which you will need to pay in addition to the costs for the advertiser you are using.

3. Add tracking to your site

In order for your retargeting marketing strategy to work, you will first need to install a tracking code on your site.

This will allow the retargeting platform to track each of the actions your web visitors take.

For Facebook, you’ll need to install the Facebook pixel.

For Google, you’ll need to add the global site tag to all pages on your website.

To use dynamic retargeting with Google, you’ll also need to have event snippets. These are used to track specific user actions such as viewing a particular product or signing in to an account.

It is important to make sure all tracking codes are properly installed. If not, you could get inaccurate or missing data.

Fortunately, Google, Facebook, and other retargeting platforms give plenty of instructions and resources to help you implement the tracking correctly.

There are also a variety of tools to help streamline the process. For example, WordPress plugins and Shopify apps that connect to your Facebook Ads account and quickly add your pixel across your site.

4. Create your retargeting ads

The next step is to create your retargeting ads. Retargeting ads are broadly categorized into one of two types; static or dynamic.

Static Retargeting Ads – Static retargeting ads function like traditional online ads. You design a creative and then that same ad is shown to everyone you are targeting in the campaign.

With static ads, you can also create several formats of the same advertisement and display them to different groups in your audience to boost the relevance of your ads.

Static ads work well if you want detailed control over your ad creative as you get to determine exactly what your audience will see.

Dynamic Retargeting Ads – Dynamic retargeting ads automatically generate ad creatives to show to each individual. Because of this, each person receives a unique ad.

The retargeting platform analyzes the person’s behavior and interests to determine what creative elements are most likely to achieve the campaign goal.

Some of the details that can impact what ad is shown include products the user has viewed, the pages they’ve visited, and their past orders.

An example of dynamic ads is Facebook Dynamic Product Ads.

With these ads, you sync your eCommerce catalog to your Facebook page and advertising account. As people view your products, the Facebook Pixel will track which users visit which items.

You can then run a Dynamic Products campaign that retargets the people that have visited items on your site.

Because Facebook knows what items people viewed, it can make sure to showcase those or related items in the advertisement.

All of this happens automatically after you set up the parameters of the campaign.

Google also has dynamic ads for eCommerce products. After you sync your product feed to Google Merchant Center, you can dynamically retarget previous visitors with shopping ads.

Retargeting Best Practices

Here are some best practices you can follow when building retargeting campaigns.

• Segment your audience
• Don’t over advertise
• Optimize your ad creatives
• Get specific with your ads and landing pages

Segment your audience

Segmenting your audience is a great way to get highly-targeted ads in front of your customers.

As you start to attract visitors to your site, you can create audience segments for groups of people that performed certain actions on your site.

For instance, a group of people that viewed products in a particular category. Or a segment of people that spent more than 10 minutes on your site.

You can also segment buyers from non-buyers. This will keep you from sending repeated messaging to people that have already.

There isn’t really a limit to how detailed you can get with your audience segments.

If you want to create a segment for customers that have spent over $200 and have viewed five products in the past week, you can

By targeting a refined selection of people with your ads, you are able to serve something that is more meaningful.

Don’t over advertise

While you want to stay at the top of your customers’ minds,  you don’t want to overdo it with retargeting ads.

Too much marketing can easily alienate some people.

You can ensure that your audience is only receiving an appropriate amount of retargeting ads by setting a limit, or frequency cap on the number of times someone is retargeted.

Some retargeting platforms such as Google have this functionality built into the platform. With it, you can set limits for the number of times a user is exposed to your ads over the course of a day, week, or month.

Optimize your ad creatives

The messaging and visuals in your ads are important for getting users to click back to your site.

You want to use the insights you have on your customers to create ads that connect with them.

You can further optimize your retargeting ads by testing different ad creatives to see what works best with your customers.

Get specific with your ads and landing pages

When running a retargeting campaign, it is a good practice to show users ads and content directly related to that which they’ve already viewed.

For instance, if someone looked at five items in your shoe collection, that person is probably interested in shoes and would respond well to such an ad.

You want to apply this concept to your landing pages as well. By giving users a relevant experience, you can help move them further down your funnel.

Furthermore, your landing pages should align with your ad creative. This congruence leads to better results as customers get an experience that matches their expectations.

Retargeting Vs Remarketing

While the terms retargeting and remarketing are often used interchangeably, they are not the same as there are some distinctions between the two.

Retargeting and remarketing are similar in that they are both methods of getting your brand back in front of your target customers.

Retargeting uses paid advertisements to re-engage users. The people are generally more responsive having recently visited your site.

Remarketing usually involves using email to reconnect with past audiences.

For example, you could send previous customers remarketing messages to show deals and promotions related to past purchases. Or you could announce new offerings related to the items they are most interested in.

Conclusion

Retargeting is a great way to get people back to your site and convert. It’s a highly effective digital marketing channel suitable for all kinds of businesses and products.

As a rule of thumb, you should always have retargeting campaigns running even if you don’t use any other paid advertising channel.

In addition, the customer acquisition costs (CAC) from retargeting campaigns are lower than any other form of advertising.