Retargeting Explained: What It Is And How Does It Work?

Retargeting – sometimes referred to as re-marketing – is an effective form of online promotion that helps businesses reach people who have previously visited their website.

Typically, most websites convert 3% of users on their first visit. Retargeting allows brands to get in front of the 97 percent of visitors that haven’t yet converted – whether they weren’t ready to buy or got distracted during the checkout process.

Without retargeting, bounced users would be lost forever. It’s time to learn how you can bring them back.

The Real Customer Journey

As a marketer, you probably conceptualize the customer journey as some sort of linear timeline that leads the prospect neatly toward conversion. That might mean visiting your website, downloading a free eBook, reading the eBook, understanding the value of your service, and making a purchase. The next minute, a sales rep reaches out to the new customer, welcomes them, gives them the information they need, and the rest is history.

“Here’s a fact that should make you uncomfortable: Approximately 92% of people who visit your website are not yet ready to purchase your product or service. They might be interested, but they’re not quite ready to convert.” – Forbes

In reality, the customer journey is typically not so linear. People visit your website more than once, with visits spaced over weeks or even months. They check out your social media platforms, read a blog you published two years ago, and subscribe to your mailing list but fail to open a single email. Eventually, they decide to contact you — they’re undecided. Your sales rep does a great job of easing their concerns and, finally, they make a purchase. Same outcome. Very different process.

Marketers need to be aware of and account for the real customer journey, the convoluted tangle of activity that is unique to each and every buyer. One of the best ways to do that is with a retargeting campaign.

What is Retargeting (or Remarketing)?

The majority of users won’t take action unless they feel like they know a business – even trust a business. A marketing rule of thumb suggests that a customer needs to be exposed to a brand seven times before they can make a purchasing decision.

Retargeting builds the visibility of your brand by directing ads to users that have already shown interest in your product or service, usually by visiting your website.

Retargeting offers exceptional potential for personalization and highly sophisticated campaigns. A user that abandons the checkout process can be shown a different set of retargeting ads than a user that quits your site without adding anything to their cart. You can customize ads for a whole range of triggers: web visits, email openings, newsletter sign-ups, link clicks, lead magnet downloads, and more.

When executed effectively, this level of personalization promotes trust. And when a customer starts to trust your brand, they are likely locked in.

“All things being equal, we always gravitate toward the option we trust most and the option that presents the fewest barriers.” — John Hall at Forbes

Retargeting may also deliver a higher marketing ROI than other digital channels as it focuses your marketing spend on people that have demonstrated interest.

How Does Retargeting Work?

There are two types of retargeting: pixel-based and list-based. Each has advantages that you can use to bolster your campaign goals.

Pixel-based retargeting

Pixel-based – or cookie-based – retargeting uses a JavaScript code to anonymously track your audience across the web.

It works like this: you add a small, unnoticeable piece of code to your website. This code is known as a pixel and won’t impact your site’s performance. When a new user lands on your website, the code drops a browser cookie. When your cookied visitor browses the web later on, your retargeting provider will display ads to them.

List-based retargeting

List-based retargeting works only when you have someone’s contact information in your database. List-based retargeting involves uploading a list of email addresses to a retargeting campaign – generally on a social media platform like Facebook – and serving ads only to those on that list.

What Can Retargeting Help Marketing Teams Achieve?

Now that you know what retargeting is and how it works, it’s time to investigate what a retargeting campaign can help you achieve. Retargeting campaigns are driven by one of two goals: awareness or conversion.

Retargeting campaigns for awareness

Awareness campaigns allow you to re-engage web visitors through relevant products, new features, and announcements and are typically pixel-based.

Awareness campaigns are not as narrowly targeted as other campaigns, meaning you can expect a lower-than-average click-through-rate. That being said, conversions aren’t the goal here. Impressions and engagements are more meaningful metrics to track.

Awareness campaigns are often the precursor to more targeted, lucrative conversion campaigns.

Retargeting campaigns for conversion

Conversion campaigns encourage users to take a next step – whether that involves completing the checkout process, filling out a landing page form, downloading a freebie, or making a purchase. Conversion metrics to track include website clicks, cost per lead (CPL), and form submissions.

Conversion campaigns can be facilitated by both pixel-based and list-based retargeting strategies. For example, you can use a pixel-based ad to generate leads – advertisements might direct a user to a landing page where they can enter their information. Then, you can use a list-based campaign to retarget users that submitted the landing page form. These second-round advertisements encourage users to make a purchase.

Use Cases for Retargeting Campaigns

1. Abandoned shopping cart

The abandoned shopping cart doesn’t have to be the end of the engagement. A retargeting campaign can encourage users to revisit their cart and complete the checkout.

Abandoned checkout campaigns are typically delivered by email. The email will address the cause of the abandonment – whether that be timing, pricing, or a distraction – and offer a solution – a discount code, free shipping, or some other exclusive offer.

2. Creating urgency

Someone has expressed interest in your product or service – you can use a retargeting campaign to create a sense of urgency, to design a now-or-never situation for the user. For example, you might offer a limited-time discount. If they don’t take action now, they’ll miss out.

3. Product showcase

Dynamic retargeting techniques can help you lure users back to your site by showcasing products they viewed when visiting your website. Personalized product showcases remind a user just how interested they were in your product, encouraging them to revisit the product page and take the plunge.

Tracking the Success of Your Retargeting Campaigns

Retargeting is a powerful tool, but it’s not always straightforward. It’s crucial that you track and analyze the success of your retargeting campaigns to refine your approach and optimize your ROI.

Michael Brenner

Michael Brenner  is a Top CMO, Content Marketing and Digital Marketing Influencer, an international keynote speaker, author of "Mean People Suck" and "The Content Formula" and he is the CEO and Founder of Marketing Insider Group, a leading Content Marketing Agency . He has worked in leadership positions in sales and marketing for global brands like SAP and Nielsen, as well as for thriving startups. Today, Michael helps build successful content marketing programs for leading brands and startups alike. Subscribe here for regular updates.