July 21


The Benefits of Retargeting Optimization for Your Website

By Hanson Cheng

July 21, 2023

  • minute read
  • Last Updated on July 21, 2023 by Hanson Cheng

    In this comprehensive article, readers will learn everything they need to know about retargeting, a powerful digital marketing strategy that aims to re-engage potential customers who have previously shown interest in a website or product. The article covers the definition of retargeting, its benefits, and its different types. Moreover, it provides a step-by-step guide to setting up a retargeting campaign, creating effective ad creatives, and implementing segmentation strategies.

    Understanding Retargeting

    Retargeting, also known as remarketing, is a digital marketing strategy allowing businesses to display targeted ads to people who have visited their website or interacted with their content. This focused approach seeks to recapture potential customers’ attention and remind them of products, services, or information they previously showed interest in, increasing the likelihood that they will revisit the site and make a purchase.

    What is Retargeting?

    Retargeting is online advertising targeting potential customers who have already shown interest in a business’s products or services by visiting their website, engaging with their content or ads, or abandoning their shopping cart. Using tracking tools like cookies, businesses can identify these potential customers and serve them with relevant ads as they browse other websites, social media, or apps. This helps businesses regain the attention of their target audience and increase conversion rates.

    How Retargeting Works

    To effectively implement retargeting in digital marketing campaigns, businesses need to install a small piece of code, known as a pixel, onto their website. This pixel allows businesses to track visitors to the site and the pages they interact with. When a user visits the website, the pixel drops a cookie (a small text file) on the visitor’s browser, which will enable businesses to identify and target that user across various platforms.

    Retargeting works only for users who have previously interacted with a business’s website, ensuring that ad impressions are served to an audience that is already familiar with the brand.

    The Benefits of Retargeting

    Implementing a retargeting strategy has several advantages for businesses:

    1. Increased brand awareness: By repeatedly exposing users to their ads after visiting their website, businesses can reinforce their brand, making it more recognizable and memorable.
    2. Highly targeted advertising: Retargeting allows businesses to display relevant ads to users who have already expressed interest in their products or services, increasing the likelihood that they will make a purchase.
    3. Cost-effective marketing: Since retargeting targets users who have already engaged with a business, the marketing efforts are more focused and typically result in better return on investment (ROI) compared to advertising to a more general audience.
    4. Improved conversion rates: Retargeting can bring back users who left the site without making a purchase, giving them a second chance to complete their transaction, thus improving overall conversion rates.
    5. Customizability: Retargeting campaigns can be tailored based on various factors such as browsing behavior, pages visited, and time spent on the site to create ads that specifically address potential customers’ interests.

    Different Types of Retargeting

    There are several types of retargeting strategies that businesses can employ to achieve different goals:

    1. Site-based retargeting: This involves tracking visitors who have left a website without completing the desired action (e.g., making a purchase or subscribing to a newsletter) and targeting them with relevant ads as they browse other sites or use different apps.
    2. Email retargeting: This strategy targets users who have interacted with a business’s emails by opening them or clicking on specific links. Customized ads are then displayed to these users as they navigate across the web.
    3. Search retargeting: Also known as keyword retargeting, this strategy serves ads to users who have searched specific keywords relevant to a business’s products or services.
    4. Contextual retargeting: This method targets users who have visited a website with similar content or services and is ideal for businesses looking to reach out to new potential customers.
    5. Social media retargeting: Platforms like Facebook and Twitter offer retargeting options that enable businesses to display ads to users who have already interacted with their website or content, increasing the chance of re-engagement.

    Considering the potential benefits and types of retargeting strategies, businesses can choose the most appropriate approach to recapture potential customers’ interest and increase conversions.

    Setting Up a Retargeting Campaign

    Retargeting is a digital marketing strategy that displays ads to users who have visited your website or interacted with your brand. This allows you to re-engage potential customers who might have otherwise lost interest, increasing the chances of converting them into buyers. Setting up a successful retargeting campaign involves identifying your objectives, selecting the right platform, creating tracking pixels, implementing them on your website, and building a retargeting audience.

    Identifying Campaign Objectives

    The first step in setting up a retargeting campaign is to define your goals and objectives. Retargeting can serve a variety of purposes, including driving conversions, boosting brand awareness, or re-engaging past customers. Before launching a retargeting campaign, you must clearly understand your goal. Some common objectives are:

    1. Increasing sales or lead generation: If your primary goal is to boost sales or gather leads, your retargeting campaign should focus on users who visited particular product or service pages but did not complete a purchase or submit a contact form.
    2. Improving brand recognition: If your aim is to raise brand awareness, you can retarget users who have visited your homepage, blog, or other content-rich sections of your website. These individuals may not have completed a purchase but have shown some level of interest in your brand.
    3. Re-engaging past customers: Retargeting campaigns can help you win back customers who have made a purchase in the past but have not been active recently. By targeting these users, you can remind them of your products or services’ value and entice them to return.

    Choosing the Right Retargeting Platform

    Once you have identified your objectives, you need to select the appropriate retargeting platform for your campaign. Some popular retargeting platforms include:

    1. Google Ads: Google’s retargeting platform allows you to display ads across the Google Display Network, covering a vast range of websites and apps. Additionally, you can use Google’s search retargeting to target users who have previously visited your site when they perform a relevant search query.
    2. Facebook Ads: Facebook retargeting allows you to advertise to users who have visited your website when they are browsing Facebook or Instagram. This platform is especially effective for reaching users who spend significant time on social media platforms.
    3. AdRoll: AdRoll is a specialized retargeting platform that offers cross-channel retargeting options. AdRoll can target users across multiple platforms, including Google Display Network, Facebook, and Twitter.
    4. LinkedIn: LinkedIn retargeting is suitable for B2B marketers seeking to re-engage professionals who have interacted with their business on the LinkedIn platform.

    When selecting a platform, consider factors like reach, targeting options, and cost to find a platform that best aligns with your objectives and budget.

    Creating a Tracking Pixel

    After selecting your retargeting platform, you must create a tracking pixel or tag. This small piece of code needs to be added to your website, allowing the platform to track visitors and serve them ads when they visit other sites. The process of creating a tracking pixel will vary depending on your chosen platform; however, most platforms provide step-by-step instructions to generate the necessary code.

    Implementing the Retargeting Pixel

    With your tracking pixel created, you must now implement it on your website. The pixel should be placed on every key page of your site to ensure that you collect relevant data on user interactions. If you are unfamiliar with website coding, you may need assistance from a web developer to ensure proper implementation. Once implemented, users who visit your site will be tracked by the retargeting platform and served ads based on their browsing history.

    Building a Retargeting Audience

    With your pixel in place, the final step is to create a retargeting audience. This is a collection of users who have visited your site and are eligible to receive your retargeting ads. When creating your audience, consider the following factors:

    1. Segmentation: You may want to group users based on their behavior or interaction with your site. For instance, you might segment users who visited specific product pages, abandoned carts, or submitted contact forms.
    2. Recency: Consider adjusting the duration you wish to target users after they have visited your site. You may want to target users quickly for highly time-sensitive offers or promotions to maximize the chance of conversions.
    3. Audience size: The success of your campaign will depend on the size of your retargeting audience. Too small of an audience may yield limited results, while too large of an audience may not be cost-effective.

    Setting up a retargeting campaign may require an initial investment of time and resources, but implementing these steps effectively will help you boost conversions and re-engage potential customers more efficiently.

    Retargeting Creative and Ad Formats

    To create an impactful retargeting campaign, it’s essential to pay attention to the creative aspects of your ads, such as design, messaging, and ad formats.

    Creating Effective Retargeting Ads

    The key to a successful retargeting campaign is to create ads that capture your audience’s attention and entices them to return to your website. Here are some tips for designing effective retargeting creatives:

    1. Brand consistency: Ensure your ads are consistent with your brand’s image, color scheme, and style. This helps reinforce brand recognition and maintains a cohesive user experience across all touchpoints.
    2. Clear call-to-action (CTA): Encourage users to complete a specific action, such as “Shop Now,” “Learn More,” or “Sign Up.” Make sure your CTA is prominently placed and easy to understand.
    3. Personalization: Tailor your ads to individual users based on their browsing history, interests, or demographics. This can lead to higher engagement and conversion rates.
    4. Refresh ad creatives: Regularly update your ad designs to avoid “ad fatigue” and maintain user interest. Experiment with different visuals, copy, and offers to find out what resonates best with your audience.
    5. Test and optimize: Analyze your ad performance and continuously test new ideas to identify the most effective creatives, formats, and messaging.

    Ad Formats and Sizes

    Choosing the right ad format and size can significantly impact your retargeting campaign’s performance. Here are some common ad formats to consider:

    1. Display ads: Traditional banner ads in various sizes can be placed on websites, blogs, and other platforms. Popular sizes include 300×250 (Medium Rectangle), 728×90 (Leaderboard), and 160×600 (Wide Skyscraper).
    2. Native ads: These ads blend seamlessly with the content surrounding them, providing a non-disruptive experience for users. Native ads can be displayed as sponsored content, in-feed ads, or content recommendation widgets.
    3. Video ads: Engaging video content can be used in retargeting campaigns on platforms such as YouTube, Facebook, or Instagram.
    4. Mobile ads: In-app and mobile web ads targeting smartphone or tablet users. Ensure that your ads are optimized for mobile devices and responsive across different screen sizes.
    5. Social media ads: Retarget users on platforms like Facebook, Instagram, LinkedIn, or Twitter with sponsored posts or carousel ads.

    Dynamic Creative Optimization

    By implementing DCO in retargeting campaigns, marketers can deliver relevant and tailored ads that significantly improve user engagement, conversion rates, and return on ad spend (ROAS).

    Customizing Ad Messaging

    Many factors can influence the effectiveness of your ads, and messaging is one of the most crucial. Here’s how to create compelling ad messaging for your retargeting campaigns:

    1. Address user pain points: Identify potential barriers to conversion and address them in your messaging. Highlight product features, alleviate concerns, or offer incentives.
    2. Leverage social proof: Incorporate customer testimonials, reviews, or metrics that demonstrate your product or service’s value and credibility.
    3. Create a sense of urgency: Encourage users to act quickly by offering limited-time discounts, promotions, or stock availability alerts.
    4. Showcase exclusivity: Make your audience feel special by offering exclusive deals or early access to new products or services.

    Remember, continually testing and optimizing your ad messaging is essential to finding the right balance of elements that will resonate with your audience and drive conversions.

    Retargeting Segmentation Strategies

    Retargeting is an online advertising technique that focuses on targeting users who have previously interacted with your website or application. By utilizing retargeting segmentation strategies, you can deliver personalized and relevant ads to specific segments of your audience. This article will discuss four popular retargeting segmentation strategies: segmenting by user behavior, time, location, and demographics.

    Segmenting by User Behavior

    Segmenting users based on their behavior is crucial for creating personalized and relevant retargeting ads. You can create tailored retargeting campaigns that cater to specific user interests by analyzing how users interact with your website or application.

    Some common user behaviors to consider when segmenting include:

    1. Page views:

    Segment users based on the specific pages they visited on your website. This can help you understand the products or services that interest them and create retargeting campaigns that showcase those specific offerings.

    2. Time spent on-site:

    Identify users who have spent significant time browsing your website or application. These users may be more engaged and interested in your offerings, making them prime candidates for retargeting campaigns.

    3. Actions taken:

    Segment users based on the actions they performed on your website, such as adding items to their shopping cart, downloading resources, or signing up for a newsletter. Tailor your retargeting campaigns to these actions to provide a seamless experience for the user.

    4. Abandoned carts:

    Target users who have added items to their shopping carts but did not complete the purchase. Send these users retargeting ads highlighting the items left in their cart, potentially offering an incentive to complete the transaction.

    Segmenting by Time

    Time-based segmentation is another crucial element of a successful retargeting campaign. By understanding when users interact with your website, you can create retargeting ads that are timely and relevant.

    Some time-based segmentation strategies include:

    1. Recency:

    Segment users based on how recently they visited your website or performed a specific action. Users who have recently interacted with your site may be more likely to convert, so target them with engaging retargeting ads.

    2. Time of day:

    Determine when users are most active on your site and serve ads during those periods. For example, if your audience is active during lunch breaks or in the evenings, create retargeting campaigns to run at those times.

    3. Seasonality:

    Plan your retargeting campaigns around specific seasons or holidays where users are more likely to interact with your site or make purchases.

    Segmenting by Location

    Location plays a significant role in user behavior and interests. You can deliver more relevant and targeted retargeting campaigns by segmenting users based on their geographic location.

    Location-based segmentation strategies include:

    1. Country or region:

    Segment users based on their location at a country or regional level to tailor your retargeting campaigns to local audiences’ cultural preferences and buying habits.

    2. City:

    Narrow your location-based targeting to specific cities or urban areas, allowing you to create hyper-local retargeting campaigns. This is particularly useful for local businesses looking to engage potential customers in their immediate vicinity.

    3. Language:

    Segment users based on their preferred language, ensuring that your retargeting ads are displayed in a language that the user can understand and engage with.

    Segmenting by Demographics

    Demographic segmentation focuses on classifying users based on factors such as age, gender, income, and education level. By understanding the demographic factors that influence user behavior, you can create retargeting campaigns that resonate with specific audience segments.

    Some demographic segmentation strategies include:

    1. Age:

    Target users within specific age groups, tailoring your campaigns to promote products, services, or messaging that resonate with that age group.

    2. Gender:

    Create gender-specific retargeting campaigns that showcase products, services, or messaging that appeals to male or female audiences.

    3. Income:

    Segment your audience based on income levels, targeting luxury products or services to higher-income users while promoting more cost-effective options to lower-income users.

    4. Education level:

    Understanding a user’s education level can help you create retargeting campaigns that offer the right level of information, depending on the user’s expertise in a particular subject matter.

    By leveraging these retargeting segmentation strategies, you can deliver more personalized and effective ad campaigns that engage users and ultimately drive higher conversion rates.

    Retargeting Bidding and Budget Strategies

    Retargeting is a digital marketing strategy focused on re-engaging website visitors who did not convert on their first visit. These potential customers are targeted with personalized ads based on their browsing behavior to persuade them to return to your website and make a purchase or take a desired action.

    You need to have a well-planned bidding and budget strategy to get the most out of your retargeting campaigns. 

    Setting up Bids and Budget

    Before launching a retargeting campaign, setting up an appropriate budget and bids is essential to balance the campaign’s reach and cost. While determining your budget, consider factors like your overall marketing budget and the results you aim to achieve from the retargeting campaign. Allocate a sufficient budget that aligns with your retargeting goals, target audience size, and the campaign’s time frame.

    Consider which bidding model best aligns with your campaign’s objectives when setting up bids. Bid amounts should be competitive enough to win ad placements but not so high that they eat up your budget quickly, reducing the overall efficiency of your campaign.

    Cost per Action (CPA) Bidding

    To set up a successful CPA bidding strategy, start by determining the target CPA for your campaign. This involves calculating the average value of a conversion and determining how much you are willing to pay for each conversion. Test different CPA bid levels to find the sweet spot where you get the desired number of actions while maintaining an optimal cost per conversion.

    Cost per Click (CPC) Bidding

    Cost per Click (CPC) bidding is an advertising model where you pay for each click your ad receives. This model works well for retargeting campaigns that focus on driving traffic to your website.

    To optimize your CPC bidding strategy, test various bid amounts to find the optimal CPC that yields the desired click-through rate (CTR) and conversion rate while maintaining an acceptable ad spend. Keep in mind that higher bids may mean a higher CTR but may deplete your budget quickly. On the other hand, lower bids may lead to fewer clicks and longer campaign duration, which may not be suitable for time-sensitive campaigns.

    Frequency Capping

    Frequency capping is a critical component of retargeting bidding and budget strategies, as it helps limit the number of times the same user is exposed to your ad within a given time frame. Over-exposure may lead to ad fatigue or even cause negative brand perception.

    Retargeting Optimization Techniques

    Retargeting optimization techniques are proven methods for reaching potential customers in a more focused manner after they have previously engaged with your services or products. This can include visiting your website, mobile app or interacting with your content on social media. These techniques aim to improve conversion rates and revenue by targeting ads and marketing efforts towards users who have already expressed interest in your products or services.

    A/B Testing of Ad Creatives

    A/B testing, or split testing, involves creating different versions of ad creatives and running them simultaneously to see which one performs better. This testing strategy helps marketers understand which ad is more effective by comparing the performance metrics of each version, such as click-through rates, conversion rates, or cost per acquisition.

    The key to successful A/B testing lies in making small, incremental changes to your ad creative, such as testing different headlines, images, or call-to-action buttons. This ensures that you can accurately measure a single variable’s impact on an ad’s performance. By continually testing and optimizing your ad creatives, you can maximize the effectiveness of your retargeting campaigns and increase conversion rates.

    Some factors to consider when performing A/B testing for retargeting optimization include:

    1. Choose a clear hypothesis: Develop a hypothesis based on your current marketing strategy and determine what you want to test, such as testing different headlines, product images, or ad copy.
    2. Define your success metrics: Set clear objectives and define success metrics, such as comparing click-through rates or conversion rates.
    3. Test ads simultaneously: Run both versions of the ad concurrently, allowing tracking differences in performance to be more accurately measured.
    4. Analyze results: Review the data collected from your A/B test to determine which ad creative yielded the best performance and identify potential improvements for future campaigns.

    Landing Page Optimization

    Landing page optimization is the process of improving your website’s landing pages to increase conversion rates. Optimizing your landing pages can improve the user experience and lower bounce rates, resulting in higher conversions and revenue. This is particularly important for retargeting campaigns, as users who have previously engaged with your brand are more likely to convert if the landing page experience is tailored to their interests and needs.

    Some best practices for landing page optimization in retargeting campaigns include:

    1. Keep the design consistent: Maintain a consistent design and branding across your ads and landing pages to create a cohesive user experience.
    2. Offer relevant content: Ensure your landing page content is relevant to the user’s previous interaction with your brand and the ad creative they clicked on.
    3. Use clear calls-to-action: Guide users towards taking the desired action with a prominently displayed call-to-action button.
    4. Optimize for speed: Improve page load times to reduce bounce rates and enhance user experience.

    Ad Scheduling and Timing

    Ad scheduling and timing play a crucial role in optimizing retargeting campaigns. By strategically scheduling your ads, you can better target your audience during times when they are most likely to convert. Factors to consider when scheduling retargeting ads include:

    1. User behavior: Analyze user engagement data to identify the times when users are most likely to be active online and receptive to your ads.
    2. Time of day: Test different ad slots to identify the most effective times for running your ads, such as during specific hours of the day or days of the week.
    3. Frequency capping: Limit the number of times your ads are shown to a single user during a specific time period (e.g., hourly, daily, or weekly) to prevent overexposure and reduce ad fatigue.

    Optimization Through Lookalike Audiences

    Lookalike audiences are a valuable retargeting optimization technique. These audiences consist of users who share similar characteristics and behaviors as your existing customers or website visitors. By targeting lookalike audiences, you can expand your reach to potential customers who are more likely to be interested in your products or services.

    To effectively use lookalike audiences in your retargeting campaigns, follow these steps:

    1. Identify your source audience: Choose a high-performing segment of your customers or website visitors as the basis for creating your lookalike audience.
    2. Set similarity criteria: Determine the characteristics and behaviors that are most relevant to your target audience, such as demographic factors, user engagement, or purchase history. Choose the appropriate similarity percentage for your lookalike audience (e.g., top 1%, 5%, or 10% of users who most resemble your source audience).
    3. Refine your targeting: Combine lookalike audience targeting with other targeting options, such as geographic location, device type, or interests, to further improve the relevance and effectiveness of your retargeting ads.
    4. Monitor performance: Regularly review the performance metrics of your lookalike audience campaigns, and revise your targeting criteria and ad creatives as needed for continuous optimization.

    Key Performance Indicators (KPIs)

    KPIs are the metrics used to evaluate the success of a retargeting campaign. These indicators help quantify the objectives a marketing team sets and provide tangible measurements of success. Some common KPIs for retargeting campaigns include:

    1. Click-through rate (CTR): The percentage of users who click on a retargeted ad after viewing it. A higher CTR is indicative of a more engaging ad that successfully captures user interest.
    2. Cost per acquisition (CPA): Measuring the total cost of acquiring a new customer, divided by the number of new customers acquired. A lower CPA is typically considered more favorable, as it represents a more cost-effective approach to customer acquisition.
    3. Conversion rate: The percentage of users who complete a desired action (e.g., purchase, download, sign-up) after clicking on a retargeted ad. A higher conversion rate signifies that a retargeted campaign is effectively driving users to perform the desired action.
    4. Revenue per visitor (RPV): An estimation of the revenue generated by each visitor to your website, determined by dividing the total revenue by the total number of visitors. A higher RPV indicates a more profitable retargeting campaign.

    Attribution Models

    Attribution models are essential in determining the impact of retargeting efforts on a user’s conversion journey. These models help allocate credit to different marketing channels and touchpoints, allowing marketers to understand the value and effectiveness of their retargeting efforts. Common attribution models include:

    1. Last-touch attribution: Assigns 100% of the credit for a conversion to the last interaction that took place before the conversion occurred. While straightforward, this model often oversimplifies the impact of various touchpoints on the consumer’s journey.
    2. First-touch attribution: Allocates credit to the first touchpoint that occurs in a conversion path. Similar to last-touch attribution, this model may underestimate the influence of other marketing channels on the user’s decision-making process.
    3. Time-decay attribution: Provides higher credit to touchpoints that occur closer to the time of conversion, weighting their impact accordingly.
    4. Linear attribution: Attributes equal credit to each touchpoint encountered by a user in their conversion journey.

    Calculating Return on Investment (ROI)

    ROI is a critical metric when evaluating the success of a retargeting campaign, as it demonstrates the effectiveness of marketing efforts in driving revenue. The primary calculation for ROI involves dividing net profit by the total amount of investment in the campaign, then multiplying that value by 100 to express it as a percentage. A high ROI signifies that a retargeting campaign is successfully generating returns for the investment.

    Utilizing Analytics for Continuous Improvement

    Effectively measuring and analyzing retargeting performance necessitates the use of analytics tools and platforms. Web analytics platforms, such as Google Analytics, Adobe Analytics, and similar tools, provide valuable insights into user behavior and traffic patterns, empowering marketers to make data-driven decisions about their campaigns.

    Analyzing retargeting performance isn’t a one-time process; instead, it is an ongoing process that should involve regular monitoring and adjustments based on the insights provided by KPIs, attribution models, and ROI calculations. Utilizing these analytics allows marketers to continuously improve their retargeting efforts, ensuring their campaigns are effective, efficient, and contributing to overall business objectives.

    Retargeting Optimization – FAQs

    What is retargeting optimization in digital marketing?

    Retargeting optimization is the process of improving and enhancing the performance of retargeting campaigns in digital marketing. This involves adjusting parameters such as audience segmentation, ad messaging, and bidding strategies to maximize the likelihood of re-engaging users who have previously interacted with a brand’s website or ads.

    Why is retargeting optimization important for businesses to implement?

    Retargeting optimization is vital for businesses because it increases the chances of converting existing leads and prospects. Optimized retargeting campaigns allow businesses to reconnect with users who have demonstrated interest in their products or services, thus increasing the likelihood of converting these prospects into paying customers and encouraging brand loyalty.

    What are some common retargeting optimization strategies?

    Some common retargeting optimization strategies include segmenting audiences based on user behavior and engagement levels, adjusting ad messaging to be more relevant and engaging, utilizing frequency capping to prevent ad fatigue, and testing different retargeting strategies to identify the most effective techniques for generating conversions.

    How can businesses measure the success of their retargeting optimization efforts?

    Businesses can measure the success of their retargeting optimization efforts by tracking performance metrics such as click-through rates (CTR), conversion rates, return on ad spend (ROAS), and cost per acquisition (CPA). These metrics allow businesses to evaluate the effectiveness of retargeting campaigns and make data-driven decisions to improve their performance further.

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    Hanson Cheng

    About the author

    Living in Portugal with my wife and puppies.
    Scaling online businesses and sharing lessons learned on this website and in our email newsletter.

    Always happy to hear from you, so find me on Instagram if you want to say hi!

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