The one-time viewer.
The cart abandoner.
The bane of a marketing team’s existence.
Potential customers leave the purchasing funnel all the time, whether they’re undecided, not ready to buy, or they genuinely just forget. For businesses, that can mean a lot of lost sales — but they don’t need to stay lost.
Retargeting is how brands stay visible to new customers, offering a second (or third, or fourth) opportunity to get those drop-offs back. But business owners have heaps of priorities to think about, and we know your ultimate question: are retargeting ads worth your budget?
Here’s everything you need to know to decide.
(Not to make the decision for you, but spoiler alert: they’re pretty good.)
What is retargeting?
I’ll start with an example. Melbourne winters are famously frosty, so to make my morning train trips less of a struggle, I was shopping online for a new jacket last week. I found one I really liked but at the same time, I got sent a few messages, and didn’t finalise my purchase.
In some circumstances, that would be the end of that. But the brand I was looking at clearly really wanted me as a customer (flattered), because when I hopped on Instagram later on, the same jacket was staring back at me in an ad.
That, in essence, is retargeting. But for those of you keen for a more specific definition, retargeting is a type of advertising that tries to reach users who have already interacted with your brand, either via your website, socials, or by clicking on one of your other digital ads. Instead of only going after completely new customers, it offers a way to focus on people who have already proven they have an interest in you.
Chances are you’ve experienced retargeting yourself, because it’s hugely popular on platforms like Facebook, Instagram and Google’s Display Network. It’s not magic — at least not in the ‘wave a wand’ kind of way — but a sophisticated method of keeping users in the purchasing cycle.
Retargeting vs remarketing
Ok, if you’ve read all the above and are thinking: “wait, this guy didn’t mention email marketing, and I get an email every time I leave something in my cart”, then that’s awesome, because it means you’re clearly a pretty savvy thinker — go you!
And you’re entirely right: emails are another really popular way that businesses keep users in the purchasing cycle, but this is a method we typically refer to as remarketing. It’s a subtle distinction, and you might see the terms used interchangeably by some, but the main difference is that retargeting is ad-based, while remarketing tends to be email-based.
Just wanted to make sure you know that I know what I’m talking about. Back to retargeting.
How does retargeting work?
Retargeting is built around a tool called the tracking pixel — a snippet of code that gets added to your website and tracks the actions of people who visit. This can include monitoring the pages they viewed, products they clicked on, and where they landed in the checkout process.
Importantly, tracking pixels don’t collect personal data. Instead, they record an IP address and use that information to serve the right people again later on. The pixel combines the pages and products information with the IP address to serve tailored ads, including ads that often show the exact product someone was looking at — like my jacket.
A quick note on third-party cookies
I mentioned that pixels don’t collect personal data, but I think it’s necessary to note that retargeting historically has relied more on third-party cookies. These are small files stored in your browser that track your activity, but they have progressively been phased out by many browsers due to privacy concerns.
As privacy standards have evolved, and online users have become more concerned with their data, pixels have emerged as a more resilient alternative, capable of supporting retargeting efforts without storing personal data.
Why is retargeting effective?
Retargeting works because it prioritises users who have already shown some engagement — those we would consider to be warm. And no, that isn’t related to me finally getting that jacket.
In marketing, ‘warm’ and ‘cold’ are terms often used to describe how likely a potential customer is to engage with your brand or make a purchase. Cold audiences are unfamiliar, and a lot of effort needs to go into getting them ready to purchase. Warm audiences, by contrast, have some prior connection and are already somewhere in your purchasing funnel. They are already ‘warmed up’.
By playing with warmer users, retargeting offers a few distinct advantages:
- It keeps your brand top of mind. The more a potential customer sees your brand pop up for them, the more familiar they become with you, and the more trustworthy you seem.
- It targets people with genuine interest. The customers you’re targeting have already shown buying signals — you’re just helping them along with a reminder.
- It delivers excellent return on ad spend (ROAS). Because your audience is warmer, you’re often able to get more conversions than prospecting completely cold audiences, leading to a more efficient spend.
Who should use retargeting?
Brands that sell jackets to men in Melbourne?
Ok but seriously, retargeting might not work for everyone, but it is an intelligent strategy for many businesses with some digital presence. In particular, it has significant benefits for:
- eCommerce brands: Retargeting helps to show off bestselling products and to target users who have added to a cart but failed to convert.
- Service-based businesses: Easily follow up people who visited an enquiry or booking page, and check if they could still use some help.
- Businesses with long decision cycles: In sectors like real estate or higher education, users are less likely to be impulsive. Retargeting makes sure they don’t forget about you while they wade through the decision.
- Brands with strong digital traffic: Whether through Google search or social media, if people are already finding you, retargeting can help you capitalise on that existing interest.
If you’re already running other advertising campaigns or cultivating an SEO strategy, retargeting helps to bring users further down the funnel until they finally become customers.
Making your retargeting work — without being weird
As we mentioned above, modern online users are intelligent, thoughtful about their data, and wary of anything that might feel like a breach of privacy. While retargeting is a powerful method of advertising, it needs to be equally thoughtful on your side, so that you don’t accidentally freak people out or bore them.
Here are some ways you can optimise your ads and your spend:
- Use frequency caps. Don’t show your ad over and over and over again; it’s an easy way to annoy people and turn them off your brand.
- Switch up your creative. Show different images and text so potential customers don’t get fatigued.
- Exclude past purchasers. There’s no point trying to push a purchase to someone who’s already made one. I appreciate your interest, but I really only needed the one jacket, thanks.
- Add value. Offer your potential customers a discount or something for free. Especially effective for those infamous cart abandoners.
- Segment your audience. A customer who browsed your entire product page without clicking anything is very different from someone who spent 7 minutes staring at a single jacket. Treat them differently in your advertising.
Is it worth it?
For the most part, the answer is a resounding yes.
Retargeting for most brands is a high-impact way to get the most value from your existing traffic. People drop out of the purchasing cycle for a lot of reasons, and it’s good to have an option that reroutes them back in. Maybe someone looked at your products and it wasn’t what they expected — that’s ok. But someone else might have loved it and has just let it slip from their mind since. That’s the kind of person you’re losing if you don’t offer them a way back.
By adding retargeting to your strategy, you’re providing a second shot for people who were already halfway there, helping to boost your conversions and increase the value of your traffic. That sounds pretty worthwhile to me.
(But I know the real question on your mind, and yeah, I wore the jacket while I wrote this blog. Retargeting works.)
Never miss a purchase
Keen to start your own retargeting campaign? We’re there with you.
Our team loves helping you transform users into loyal customers, and with years of experience across search and social, you’ll be in the best hands. Get in touch for a chat, and we’ll have your strategy formed and firing in no time.
