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Retargeting 101

Published: December 8, 2022

Author: Russell DiDona

*A previous version of this blog originally appeared on Inseev.com. It has been altered and updated by 3Q/DEPT.*

If you’re new to display or social advertising – especially direct response advertising – retargeting is a core strategy you should know about and take advantage of, as it can be a lucrative source of conversions and sales.

What is Retargeting?

Retargeting is showing an ad to users who have engaged with your brand or showed interest somehow (such as visiting a website, viewing a product, or putting an item in a cart but not purchasing). Users are “cookied” (typically after visiting your website), then shown ads of the product they recently viewed with the goal of moving them through the sales pipeline.

Why is this important? Because most users who visit your site won’t convert immediately. According to Hubspot, only 2% of new visitors will make a purchase on their first visit, while returning visitors makeup as much as half of eCommerce transactions.

For this reason, you must consistently remind users about your products or services each time they visit and leave your website to keep your brand top of mind.

So How do I Start?

First, you must have the appropriate tracking code(s) on your website. If you’re using Google Analytics, you can push your conversion events and other audiences directly into Google Ads and set up tracking directly on that platform. If you’re using Facebook, you will need to install their pixel before you can create custom audiences (site visitors).

The Facebook pixel is a piece of code for your website that collects important visitor data (such as what pages are visited and how much time is spent on each page) so that you can optimize and build audiences for your campaigns.

Once you have pixels implemented, your audiences created, and your conversion events set up, you’re ready to set up your retargeting campaign!

Diving Deeper

If you want a basic retargeting campaign, you must implement pixels and make sure audiences are built. However, this is where many marketers need to improve. In most cases, you should exclude past converters. How many, or how far back, you want to exclude will vary by product and brand. At the minimum, you should exclude recent converters because there is a low chance that a customer will buy that product again immediately. Consider excluding all converters if your brand has a longer purchase cycle or only a single conversion event. One way you can do this is by uploading a list of all your customers from your CRM platform and regularly updating it.

Audience Segmentation

You should cluster visitors into different buckets to maximize your chances of converting. This will allow you to customize messaging and bids, and optimize better. Make sure to steer clear of a one-size-fits-all retargeting strategy that doesn’t leverage customer information and their behavior with how they have interacted with the brand.

Let’s say that you’re a clothing brand. You can create separate audiences for users who have viewed women’s and men’s apparel. If you have a lot of site traffic or certain products that get a lot of traffic, you can even create audiences for specific products. This will allow you to highlight certain items that customers have looked at while browsing. To prevent audience overlap, it’s important to remember to set up audience targeting exclusions.

For optimization purposes, you will likely discover that some audiences perform better than others. This is true for all media, including retargeting. Someone who just visited your homepage may be less likely to convert than someone who visited multiple pages or browsed a certain section of your site. Create an audience for users who have abandoned the conversion process partway through (such as adding an item to their cart but not checking out or filling out a form but not submitting it). With enough traffic and strategy, your marketing efforts can reflect the full sales funnel.

You can also segment your audiences by time. For example, you may find it beneficial to retarget users who visited within the last day, seven days, 14 days, etc. This is an opportunity to determine the most appropriate time to tailor customized messaging to re-engage with customers. Similar to page segmentation, make sure you exclude the narrower windows as you add new audiences.

If Retargeting is so Great, Why do I Need Anything Else?

One of the most common misconceptions of retargeting is that you can just continue pushing your budget into retargeting. After all, if it’s so efficient, why would you run anything else? Why wouldn’t you just spend more of your budget on it?

You can’t just pump endless money into retargeting because you’ll annoy your users and waste your money. You should always keep an eye on your frequency (i.e. how many times, on average, users are seeing your ad within a given timeframe). Since you’re targeting a finite pool of users, there is a limit to the amount you can spend efficiently. If you push your budget higher than the pool allows, you’ll just end up hitting the same users repeatedly, thereby wasting impressions and spend.

The answer to the first question is a bit more complicated. As mentioned, your retargeting pools are finite, so you need to continually fill the pool through prospecting. Prospecting refers to the very top of the sales funnel (attracting attention and spreading awareness) and is key to driving conversions further down the funnel. If you don’t run any prospecting at all (i.e. driving new users to your site), that pool will eventually dry up. We recommend that clients invest no more than about 20-30% of their total budget into retargeting.

To summarize what you’ve learned about retargeting, here’s a quick checklist:

  • Implement tracking codes.
  • Create audiences.
  • Segment based on position in funnel, page(s) visited, timeframe, etc.
  • Setup exclusions.
  • Monitor performance and frequency by adience.
  • Continuously refill audience pools with new users.

Find out how 3Q/DEPT can help your brand maximize its conversions and attract new audiences. Reach out to us to learn more about how we can help your brand grow.

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Chicago, IL 60606(650) 539-4124


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