What Is Retargeting, and How Can It Boost Conversions?

By Adam Uzialko,
business.com writer
|
Jul 30, 2020
Image Credit: Weedezign / Getty Images

Retargeting, sometimes referred to as remarketing, can improve user engagement with your advertisement and optimize your marketing budget spend. Here's how to use retargeting for your business.

If you've ever seen the same advertisements repeatedly on your social media feeds after you've searched for a product, you've been the subject of retargeting. Retargeting is a way for brands to serve previously engaged users with advertisements that might be relevant to them, increasing the odds that a user will engage with the ad and reenter the conversion pipeline.

Retargeting can help your business make better use of its marketing budget and complement virtually every facet of your broader digital marketing strategy. Here's everything you need to know about retargeting and how it could boost your business's sales.

What is retargeting?

Retargeting is a strategy in digital marketing that identifies users who recently visited a brand's website or engaged with a previous advertisement and delivers additional ads to them. This is intended to increase engagement and, ultimately, drive conversions.

"Retargeting is a digital strategy that is used to maximize media spends by re-serving ads to warm users," said Gerard LaFond, senior vice president of digital at marketing agency LEWIS. "By engaging with non-converting but recent site visitors, you are serving ads to targets more likely to respond favorably with engagement, like clicking on your ad again, and completing the intended conversion – typically a form fill, site visit or transaction."

The rationale of a retargeting ad is that a user who engaged with an advertisement previously has at least a modicum of interest in the associated product or service. Rather than spend marketing funds delivering ads to users who may or may not be interested, it often behooves brands to deliver a retargeting ad to users who have indicated some level of interest before.

"Retargeting helps to reengage potential customers and get your offer in front of them again," said Joe Harulow, digital marketing executive at Tao Digital Marketing. "This can have a big impact on sales, as the people being remarketed to have normally shown some form of commercial intent."

How does retargeting work?

Retargeting can occur on a number of channels and ad platforms. It starts with setting up advertisements and calls to action (CTAs) with the appropriate technology to track user impressions and engagement.

"The main channels for retargeting are search, social and display," said LaFond. "The best way for a small business owner to start their retargeting efforts would be to ensure all tracking, including the appropriate channel pixels for attribution and audience bucketing, are set up correctly and in place."

Once you have the ability to track your audience's activities online, you can determine precisely which type of potential customer to remarket to. Generally, ad retargeting focuses on users who have expressed some interest in making a purchase, but for whatever reason dropped out of the conversion funnel along the way.

"Retargeting is one of the most effective advertising techniques at the conversion level, since we direct our efforts to users who have previously been in our store and therefore are interested in the products we sell," said Laura Aranda Rivera, lead performance marketer at Freepik Company. "With retargeting, we will decide which of our users to impact. For example, we could remarket to only those who have abandoned the shopping cart in the last 30 days."

Examples of retargeting

If you see ad content for a funny T-shirt on your social media feed and like the post, it's likely that you'll see the same advertisement on your feed again. That's because a brand has identified you as a potentially interested user and remarketed its advertisement to you.

"If your prospects are spending time on social media platforms, it may make sense to tap into some of the platform's retargeting features," LaFond said. "Have you ever wondered why you see an ad on Facebook for a product you just looked at online? That's retargeting, and it can be very powerful for certain brands and audiences."

Similarly, search retargeting focuses on bringing previous, non-converting website visitors back to a brand's page, with the goal of driving conversions.

Retargeting vs. remarketing

The term "retargeting" is often used interchangeably with "remarketing." However, there is a slight difference between the two. While both retargeting and remarketing are intended to reengage prospects who previously indicated interest in a brand's products or services, remarketing is typically reserved for the email channel.

"Remarketing is the act of bringing people back to your business through email campaigns and reaching out to the people who have had certain interactions on your website," Harulow said. "Retargeting, however, is more focused on paid advertising and tracking events that happen on your website or ad campaigns, [such as] product clicks, clicks on your ad [and] form fills."

The difference in terminology today is largely semantics. Both retargeting and remarketing are part and parcel of a strategy that brings previously engaged users back into the fold and encourages them to become customers. The major difference between the two is the channels through which the strategy is applied.

"These terms are used fairly interchangeably these days," said LaFond. "For a more technical definition, remarketing is considered to be more email-specific, and retargeting is site- or cookie-based. Both of these strategies are pushing users back to complete an action onsite, but the path can vary."

How does retargeting complement other marketing strategies?

Retargeting complements every aspect of your broader digital marketing strategy, because it identifies mid- to low-funnel prospects who have not yet converted and keeps your products and services top of mind. By re-serving advertisements or CTAs to users who previously considered a purchase or simply indicated interest in your product or service, you increase the odds that they will eventually become a customer. Without retargeting, the odds that a user forgets about the initial engagement and never returns to your brand's webpage are significant.

"Remarketing is a powerful marketing tool that complements your brand and drives conversions across your marketing funnel," LaFond said. "It should be considered complementary to all your marketing efforts."

How to boost conversions with retargeting

The following tips can help you boost conversions – whether that means sales, sign-ups or some other action – during your retargeting campaign:

  • Include simple CTAs. Retargeting advertisements should be different from those intended to drum up general brand awareness. Retargeted users are more likely to engage with clear and simple CTAs, such as "shop now" or "learn more." Deliver these CTAs in short, imperative language, and make them easily clickable to lead to your preferred landing page.

  • Employ A/B testing. To know which types of advertisements are the most effective for your retargeting campaign, test two different versions of the same ad. After a brief trial period, review which version drove more engagement and consider deploying the more successful advertisement widely.

  • Be creative with retargeting options. Retargeting advertisements could be static, dynamic or even video-based. Depending on what suits your value proposition and your audience segments, consider employing different types of ads to keep things fresh.
  • Beware of ad fatigue. When retargeting, be careful not to overload your prospects. Users will quickly tire of seeing the same ads from the same brand. Showing them ads over and over again could be counterproductive, causing prospects to drop out of the conversion pipeline for good.

  • Continuously optimize your approach. Don't let your retargeting campaign run on autopilot. The best marketing campaigns are those that brands regularly reassess and fine-tune. Continuously revisit your retargeting campaign, consult the data, and consider opportunities to improve it, whether that means altering the frequency with which ads are served to prospects or revising the CTAs in those ads.

A retargeting strategy is a sophisticated method of reengaging previously interested users, relying on data-driven insights and advanced tracking methods to boost conversion rates amongst a target audience. However, the concept behind it is simple: You get more bang for your buck if you focus on users who are already interested in (or at least curious about) your products and services. Done right, retargeting can easily help you boost conversions of all kinds and improve your overall return on investment in your digital marketing strategy.

Freelance editor at business.com. Responsible for managing freelance budget, editing freelance and contributor content, and drafting original articles. Also creates product and service reviews to assist business.com readers in buying decisions for their businesses. VP and co-founder of CannaContent, a digital marketing company dedicated to the cannabis, hemp, and CBD industries. Focused specifically on the content marketing arm of the company, creating blogs, press releases, and website copy for clients spanning the entire supply chain. Avid fan and indispensable ally of the feline species. Music lover, middling guitarist, and unprompted vocalist. Miniature painter who loves sci-fi and fantasy. Armchair political philosopher with a tendency to read old books written by men with unusually large beards. Ask me about all things writing!
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