What Are Retargeting Ads? Retargeting Definition and Meaning

Have you ever wondered why you keep seeing ads for that product you searched for three weeks ago? The internet has become a fully connected place, and ecommerce companies use this interconnectivity to target the audiences most interested in their goods and services. This process is known as retargeting.

An illustration depicting retargeting

Benefits of retargeting

As you can imagine, there are some huge benefits to employing retargeted ads. Marketing is often one of the largest expenses incurred by businesses. It is vital to know that the marketing budget is being used effectively. Here are some of the main benefits that companies using retargeted ads get to enjoy.

Increased sales

By carving out mindshare with a customer base, businesses see huge sales boosts over time. As mentioned earlier, the more people see something, the more likely they are to purchase it.

Spreading brand awareness

Growing a recognizable brand is a big goal for many businesses. The best way to do that is to ensure people don’t forget the name. By having a retargeted ad keep popping up, it creates a lasting impression on the consumer.

Gaining insights

Any retargeting platform worth its salt will feature tons of analytics. Marketing firms can use this data to learn the best ways to generate conversions. You can easily identify where people are clicking on retargeting campaigns most frequently. This data can also be used to determine how many times the average customer needs to see an ad before pulling out their credit card.

Getting more bang for your buck

Retargeted ads increase the cost-effectiveness of marketing campaigns considerably. Arbitrary banner ads will only ever draw in a small percentage of people viewing them. A more direct targeting strategy ensures that only customers that would be interested in the first place will see the ad. This leads to a higher ROI on each dollar spent on marketing.

Staying ahead of The Digital Curve

As online commerce becomes increasingly common, marketing technology will continue to evolve and adapt. Retargeting ads will only become more effective and concise over time. It is most beneficial for businesses to set up a retargeting framework as soon as possible. This puts the company in a position to stay ahead of emerging trends in the digital marketing space.

How Does Retargeting Work?

A company can retarget anyone who has previously visited their website. You have most likely seen a notice about browser cookies whenever you visit a new website for the first time. These cookies are the basis for how retargeting works. A website owner can implement a small line of code in the JavaScript of their site. This line of code will usually take the form of just one pixel. This pixel is incredibly small and doesn’t alter the website’s performance.

The pixel can be used to place a cookie into your web browser anonymously. This allows the company to track you long after you leave the website. In most cases, the cookie is used to display relevant ads wherever you go online. The retargeting provider uses the cookie to know precisely when and where to place the ad. Through the use of analytics, the company can serve up ads to only the people who are most likely to take action on them.

If a website is asking you to accept their cookie settings, then you can almost guarantee you will see ads from them shortly. This is why you see ads for items that you have recently looked at in previous browsing sessions. Over time, you will notice that the ads begin to change. This is because all of the new websites you visited are all vying to retarget their ads to you. Since there are only so many ad spaces available, each company must fight over the finite marketing opportunities presented to them.

Types of Retargeting

There are two main forms of Retargeting. We have already briefly touched on pixel-based retargeting. There is also a method of list-based retargeting. Each type has distinct pros and cons, depending on a company’s marketing goals.

Pixel-Based Retargeting

This is by far the most common form of retargeting. A simple line of code is all that’s needed to get the ball rolling. This code enables the JavaScript to place a pixel on each webpage. As people visit the site, the pixel places a cookie into their browser. The cookie remains on the browser until it is manually cleared by the user. It can also be flushed out after the person visits enough other websites that each add their own cookie.

Once you leave that site, the cookie will transmit data to a retargeting provider. With the day in tow, a retargeting platform can begin to issue retargeted ads. The biggest advantage of pixel-based retargeting is how quickly it starts. Within minutes of leaving a site, you may begin to see ads for it popping up. This allows marketers to build a stronger impression instantly.

However, the downside is that people click on websites by mistake all the time. If a person with no interest in the subject matter accidentally lands on your page, the retargeting pixel will view them no differently than an interested customer. This can lead to wasted advertising dollars.

List-Based Retargeting

Retargeting lists are becoming more popular as businesses move online. List-based retargeting requires that a customer give out some of their information in advance. This personal information is most often acquired when people signup for a newsletter or website login. This type of retargeting is more direct since many people won’t give you an email unless they are quite interested.

Many online businesses use list-retargeting to get customers to upgrade subscription plans. Free trial users can be retargeted in order to persuade them to purchase a premium subscription. It can also be used to get blog readers to buy a partner’s product. List-based retargeting is also incredibly simple to implement. Most retargeting platforms allow a website to simply import their existing mailing list onto their server. 

The obvious downside to this method is that you need to get customers to hand over personal information. Even getting a reliable email from most people can prove challenging. Businesses using this method need an impeccable website that gets people willing to open up. However, businesses with a sizeable mailing list can see a huge return on investment. If you can get people to pay you monthly, you can rake in some serious profit.

How to Select a Retargeting Platform

With the myriad options available to you, it may be tough to choose the retargeting platform that will benefit you the most. There is no magic bullet here. Each business has a unique presence and will require a custom strategy to be most effective. There are several key factors to consider before you invest in a marketing campaign. 

Size of Your Business

The size of your business is the first place to start. Some platforms specialize in helping small businesses with limited traffic. Other services are geared towards large corporations with millions of potential customers. If your business is still relatively small, you also want to consider a platform’s ability to scale along with you. This will ensure you don’t have to change providers as you expand outward.

Budget Constraints

Many smaller operations only have so much extra money to invest in marketing. Using a platform that helps you control spending is a great way to stay on budget. The last thing you want is to bleed your funds dry on an ineffective campaign. If you choose a platform that can scale with your business, you will always remain in that budgetary sweet spot.

Target Audience

Understanding your audience is key to success in any business. Are your customers most likely using Facebook? Are the majority of your audience on Instagram? Figuring these questions out is a great way to pick a platform that your customers will resonate with. 

Familiarity

Are you an avid social media user? If so, then you most likely already know the ins and outs of sites like Facebook. Selecting a platform you already feel comfortable with can be an excellent move. Just be sure that the platform is equipped to handle the specific needs of your business.

Don’t Be Afraid to Shop Around

When first starting out with digital marketing, it can be tough to tell if you’re getting a good result. You can always try out multiple platforms over the course of a few months. This is a great way to discover what works best for your products and clients. Once you have a good thing going, stick with that retargeting service for as long as possible.

Frequently Asked Questions (FAQs)

1. What are retargeting ads?


Retargeting ads are ads that are informed by previous search history. They are often from sites the person visited in the last few weeks.


2. What is the purpose of retargeting?


Very few people buy something when they first see it. The more times you are exposed to something, the more likely you are to spend money on it.


3. What do retargeting ads look like?


They look just like any other ads you will see online. The key difference is they are for products that you recently searched for. The goal is to jog your memory each time you see the same item or service.


4. Where do retargeting ads appear?


Retargeted ads can appear anywhere online that has ads enabled. Expect to see them on search engines, website banners, and even before you watch a YouTube video. Most ads you see are retargeted.


5. Should marketers be concerned with people who have already left a website?


Yes. Many internet users love to window shop without the pressure of a live environment. If someone isn’t reminded of the things they search for, they will simply move on to the next shiny thing.


6. What is the difference between search and site retargeting?


Search retargeting doesn’t require a user to visit your site first. Past search history can be used to determine if a person would be interested in the new product. Site retargeting requires a user to have visited a site at least once. This provides hard proof that the person has some interest in the good or service.


7. How do customers feel about retargeted ads?


Most customers don’t even realize it is occurring. Of the people who know about retargeting, it is estimated that only 11% view them negatively.


8. How many people opt-out of marketing cookies? 


Surprisingly, only about 10% of users choose to leave a site rather than have a cookie installed. 

Conclusion

The internet has given marketers the power to market to people like never before. Retargeting offers marketers a robust set of tools to maximize the returns on their advertising budget. If your business hasn’t adopted retargeting yet, it is something to look into immediately. Any business that incorporates retargeting effectively will see a significant boost in sales.

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