What is Retargeting? (Ads That Get Visitors to Come Back)

What is retargeting

You may have had this happen. You visit a site, and then afterwards it seems like you see ads for that site everywhere you go.

Coincidence? Stalking?

No – it is called retargeting.

For businesses, retargeting has become a common practice in the world of advertising over the past few years.  Retargeting ads are designed to get visitors to come back to your site.

Consider this: according to Retargeter.com, only 2% of web visitors convert to a sale or other action on the first visit. That’s abysmally low considering the average volume of traffic an average website pulls in.

So, what’s a small business to do?

If you want to increase your conversions (e.g., sales) there are a number of things you can do. You could increase your traffic to get more visitors. You could make your offering more attractive. You could improve your website, such as making your calls to action more prominent.  You could do various activities to improve local conversion rates.

There’s another option. If you have the money to advertise, you may decide to use retargeting ads. Retargeting ads help remind your prior visitors about your site, and increase the chances they will return and buy.

The idea behind retargeting is to get a higher percentage of visitors to convert to a sale, because they are reminded of your site even after they leave.

Retargeting focuses on the 98% of visitors who left your website for reasons unknown. The act of serving them with reminder ads is an attempt to keep your brand in their cognitive zone and to allow your brand to sink in. And it beckons them back.

Retargeted ads focus on lost traffic. These ads are your last hope before the customers go beyond the point of no return.

None of the above techniques are mutually exclusive. You could do any and all of the above to increase your conversions — increase your traffic, improve your offering, improve your website and/or retarget ads.

How Retargeting Works

The way retargeting works is simple from the advertiser’s perspective. The advertiser’s website includes a piece of javascript code. That code sets a cookie in the visitor’s browser. When the visitor goes to other sites, the cookie ensures that the advertiser’s ads are displayed only to those who have previously visited the advertiser’s site.

Today, retargeted ads have become widespread.  You can deliver retargeted ads through Google AdWords (Google calls it remarketing). Even LinkedIn and Facebook now have retargeting as a part of their advertising platforms.

Retargeting is done anonymously. In other words, the fact that a site visitor is seeing an ad does not mean the advertiser is getting any personal data about the visitor. That advertiser simply wants the visitor who was there to see their ads and be reminded to come back and do something.

In fact, one of the best parts of retargeting is you don’t need to know who the “prospect” is. Unlike email marketing that depends on a customer’s email address to continue nurturing until they buy, retargeting is independent of any contact with your visitors.

Does Retargeting Really Work for Small Businesses?

The numbers are impressive.

Econsultancy.com reports that envelopes.com cut down its shopping cart abandonment rate by 40% thanks to retargeted emails.

ReTargeter.com has even more proof in numbers: Zen Desk – a web-based customer support software for businesses – used retargeting to achieve the following: a whopping 1317% ROI (return on investment) from all conversions combined, a 1160% ROI in view-through conversions, and a 57% ROI from click-through conversions.

The Numbers are Cool. So, is Retargeting Infallible?

Retargeting is complex. It works, but….

We used retargeting ads for two years to build up brand visibility for BizSugar.com, another site we purchased in 2009. We wanted to remind visitors to keep coming back and keep using the site. In our case we were trying to increase registrations and repeat visits. It worked well for those purposes.

But … retargeting may also be costly and perform poorly if not well executed. You could be flushing your advertising dollars down the drain.

Here are some best practices for retargeting:

(1) Start out with clear goals. Is your goal to raise brand awareness? Is it to increase sales? Is it to increase registrations or newsletter signup or some other call to action?  You goal(s) will dictate how you execute retargeting ad campaigns.

(2) Don’t overdo it.  Smart advertisers don’t overload that visitor with a gazillion ads for weeks on end, annoying the visitor. Instead, limit the number of ad impressions and number of days to display ads to previous visitors. Remember, you’re trying to positively impress that prior visitor, not creep them out.

(3) Don’t waste money with poor targeting. As a site visitor, has this ever happened to you? You visit a site, you buy something, and then you are bombarded with ads for the very thing you bought for the next four days. Does that site really expect you to go back four days later and buy MORE of the exact same thing? Not going to happen.

Dax Hamman on Search Engine Land suggests segmenting your site, so that you can retarget more intelligently depending on the stage in the buying process that the visitor reached before leaving your site. And instead of serving a one-size-fits-all banner ad, serve ads targeting actual shopper preferences or based on their last activity on your website (such as apparel ads to those who were browsing apparel, not hardware ads or generic brand ads).

How Can You Make Retargeting Work?

Retargeting is a good opportunity for small businesses but it doesn’t override other digital marketing best practices. All the best practices for optimization of landing pages, ads, blog posts, product pages (for ecommerce sites), and shopping carts still apply. Analytics and using data also are critical components, as are understanding visitor behavior.

When done right, retargeting is an incredibly powerful opportunity for businesses and marketers to increase their exposure, boost their conversions, and pump up sales. When done wrong, it could be a disaster waiting to happen.

Is it a double-edged sword? It certainly is.

But done well, as part of an overall marketing strategy, retargeting can be powerful for small businesses.

Come back image via Shutterstock

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Anita Campbell - CEO


Anita Campbell Anita Campbell is the Founder and Publisher of Small Business Trends and has been following trends in small businesses since 2003. She is the owner of BizSugar, a social media site for small businesses, and also serves as CEO of TweakYourBiz.com.

11 Reactions

  1. I can see how this type of strategy can backfire. Some people can find the same ads irritating. Sure, it may seem that the company is catching them when they need it. But what if they don’t and they just see the company to be someone who has a big advertising budget. That will depend on how the customer will view the company.

    • Hi Aira, Yes, it could backfire, but in my opinion that’s likely to happen only if you don’t have a strategy for retargeting and don’t execute well.

      Mostly it never hurts to look like you have a big advertising budget – there’s nothing like appearing successful to attract success. :)

      - Anita

  2. Thanks for a great explanation of retargeting.

    Now I understand it.

    I hear that is can be pretty expensive.

    True?

    The Franchise King®

    • Hi Joel, It depends. With AdWords, you would have an AdWords spend — so essentially whatever you’d spend with AdWords.

      With something like Retargeter, when I started it was a flat $500 per month. I see the monthly amount is now $1500, according to their pricing on their site. That targets 30K unique visitors. When I advertised with Retargeter, I believe we targeted 10,000 visitors. So I believe the pricing is the same, it’s just that they have a minimum monthly buy now that’s higher than when we used the service.

      Also, by targeting that many visitors coming back, it doesn’t mean you’ll get that many visitors to YOUR site. It just means that number will be targeted to see your ads.

      - Anita

  3. Two words – Frequency Capping. Don’t saturate your potential customers to the point of annoyance.

  4. I’ve always wondered about that and how that happens, when I visit a site and then I’m on another completely different one and see ‘relevant’ ads. So that’s retargeting. I see. I can’t say I like it though as I generally don’t like ads online or being followed by them.

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