The Pros and Cons of Retargeting Tools for Your Business

Last Updated on July 20, 2023 by Hanson Cheng

This comprehensive guide will teach you how retargeting works, its benefits and challenges, and the different types of retargeting strategies like pixel-based, list-based, and search-based retargeting. We also explore various retargeting tools and platforms available, such as Google Ads Remarketing, Facebook Retargeting, and LinkedIn Matched Audiences.

Additionally, you will discover important steps to design, implement, and optimize your retargeting campaign and best practices for ensuring a successful and effective retargeting strategy.

Understanding Retargeting Tools

What is Retargeting?

Retargeting, also known as remarketing, is a form of online advertising that allows marketers to serve personalized ads to users who have previously visited their websites or engaged with their brand in some way. The primary objective of retargeting campaigns is to increase brand awareness, drive conversions, and maintain a connection with potential customers who have displayed interest in a product or service but have not yet converted.

Retargeting tools typically utilize cookies and other tracking technologies to collect data about a user’s online behavior, interests, and browsing history. This data is then used to create customized ads that cater to a user’s unique preferences and needs, increasing the likelihood of a conversion or repeat visit. This highly targeted approach to advertising allows marketers to effectively reach a “warm” audience that already showed some level of interest in their products or services, resulting in a higher return on ad spend and improved overall campaign performance.

How Retargeting Works

At its core, retargeting involves the use of tracking technologies, like cookies or pixels, to identify users who have visited your website and serve them relevant ads on other platforms or websites they visit.

Here’s a step-by-step explanation of how retargeting works:
1. A user visits your website or engages with your brand in some way, such as clicking on a link in an email, interacting with your social media posts, or downloading content from your site.
2. As the user browses your site or interacts with your brand, a tracking cookie or pixel is placed on their device, allowing you to collect data about their online behavior, interests, and preferences.
3. Once the user leaves your site without completing a desired action (like making a purchase or signing up for a newsletter), your retargeting tool begins to serve them personalized ads across various platforms and websites they visit. These ads often feature products, services, or content that the user has previously shown interest in or engaged with.
4. As users continue browsing the web, they will likely encounter your personalized ads on multiple occasions. This increases brand familiarity and the likelihood that they will revisit your site and take the desired action, such as making a purchase or signing up for your newsletter.

The Benefits and Challenges of Retargeting

There are several benefits to using retargeting tools as part of your digital marketing strategy:

1. Increased brand awareness: By serving personalized ads to users who have already engaged with your site, you’re increasing the likelihood of them remembering your brand and revisiting your site to make a purchase or take the desired action.
2. Higher conversion rates: Retargeting allows you to focus your advertising efforts on users who have already demonstrated an interest in your products or services, resulting in higher conversion rates compared to standard display advertising campaigns.
3. Improved ad engagement: Personalized, relevant ads generated by retargeting tools are more likely to capture a user’s attention and encourage them to click, increasing their engagement with your brand and improving overall ad performance.

However, retargeting also comes with its challenges:

1. Privacy concerns: Using cookies and tracking technologies raises privacy concerns, as they collect user data without explicit consent. Marketers must comply with data privacy regulations like GDPR and be transparent about their data collection practices.
2. Ad fatigue: Overusing retargeting can lead to ad fatigue, as users may become annoyed or frustrated by seeing the same ads repeatedly. To ensure a positive user experience, it’s essential to strike a balance between retargeting frequency and user engagement.
3. Ad-blockers: Some users employ ad-blockers or have cookie preferences set to block third-party cookies, preventing retargeting tools from serving targeted ads. This can limit the reach of your retargeting campaigns.

Overall, retargeting tools can play a crucial role in your digital marketing strategy by helping you stay connected with users who have expressed interest in your products or services. By understanding the benefits and challenges associated with retargeting, you can develop an effective plan that optimizes the impact of your campaigns and drives business results.

Types of Retargeting

Retargeting, also known as remarketing, is an online advertising strategy aimed at targeting users who have interacted with a brand or visited a website without completing a desired action, such as making a purchase or signing up for a newsletter. Retargeting helps in reintroducing your brand or products to users and increases the chances of conversions.

Pixel-based Retargeting

Pixel-based retargeting is one of the most common retargeting strategies used by businesses. It involves using a small piece of JavaScript code or a “pixel” placed onto a website, which is triggered every time a visitor comes to the site. The pixel places an anonymous cookie in the user’s browser, allowing the advertiser to show ads to that specific visitor once they leave the website.

As pixel-based retargeting is automatic and immediate, it enables businesses to target users when they are still browsing the web, increasing the chances of conversion. It also helps in targeting users who are most likely interested in the business, as they have previously visited the website. One limitation of pixel-based retargeting is that it only allows advertisers to target users who have already visited their website, limiting the reach of the campaign.

List-based Retargeting

List-based retargeting involves targeting users based on a known list of contacts, usually email addresses, that the advertiser already possesses. The process typically includes uploading a list of user email addresses to a retargeting campaign, which will then use platforms like Google Ads, Facebook, or other social media channels to show ads to users associated with those email addresses.

Search-based Retargeting

Search-based retargeting, also known as keyword retargeting, involves targeting users based on their search queries on search engines. Advertisers can identify users searching for specific keywords related to their products or services and present them with ads when they visit different websites.

This type of retargeting helps businesses target users who may not have visited their website before but have shown interest in similar products or services, thus expanding their reach. Search-based retargeting also allows advertisers to tap into user intent and target ads that are relevant to the user’s search. However, the users in this method may not be familiar with the business yet, hence may not be as likely to convert initially.

Focused and Dynamic Retargeting

Focused and dynamic retargeting involves showing personalized ads to users based on their browsing behavior and interactions on a website. Instead of displaying generic ads, dynamic retargeting creates ads that feature products or services that a user has viewed or interacted with, making the ads more relevant and personalized.

Top Retargeting Tools and Platforms

Google Ads Remarketing (AdWords)

Google Ads Remarketing, previously known as AdWords, is one of today’s most popular and widely used retargeting tools. It allows businesses to create tailored ads for individuals who have previously visited their website, so these ads are more relevant and engaging. Google Ads Remarketing works with the Google Display Network, which consists of over 2 million websites, reaching over 90% of people on the internet worldwide.

Google Ads Remarketing works by adding a small piece of code called a remarketing tag to your website. When a user visits your website, they are given a unique cookie identifier that is stored on their browser. Google Ads can then display ads specifically targeted to that particular user as they browse other websites within the Google Display Network.

Some of the advantages of using Google Ads Remarketing include:

1. Improved campaign performance: Retargeting is generally known to generate higher click-through rates and conversion rates. This is because the ads are more relevant, personalized, and timely, increasing the likelihood that people will engage with them.
2. Large reach: With the Google Display Network, your ads can potentially reach a vast audience, increasing your brand awareness and product visibility.
3. Customizable campaigns: Google Ads allows businesses to create custom audience lists, set specific timeframes for their retargeting campaigns, and includes a variety of ad formats to choose from.

Facebook Retargeting (Custom Audiences)

Facebook Retargeting, also known as Custom Audiences, is a powerful tool that enables businesses to target previous website visitors, existing customers, or mobile app users with ads on the Facebook platform. Facebook is considered one of the most effective retargeting platforms due to its large and engaged user base.

Facebook Retargeting works similarly to Google Ads Remarketing. By installing Facebook Pixel on your website, you can track user behavior and create a custom audience for retargeting. You can even segment your audience based on specific actions, such as page views, adding items to a cart, or making a purchase. With this information, businesses can create tailored ad campaigns that are more likely to result in conversions.

Some benefits of using Facebook Retargeting include:

1. Large audience: Facebook’s user base is massive, allowing businesses to reach a wide range of potential customers.
2. Detailed targeting: Facebook allows you to create highly customized audience lists based on demographic information, buying patterns, and user behavior.
3. Multiple ad formats: Facebook retargeting ads can be displayed in various formats, including single-image ads, carousel ads, and video ads, suitable for different business needs and objectives.

LinkedIn Matched Audiences

LinkedIn Matched Audiences is a retargeting tool designed specifically for businesses that want to target professionals and B2B audiences. Using LinkedIn Insight Tag, a piece of JavaScript code added to your website, you can track visitor behavior and create a custom audience for your LinkedIn ad campaigns.

LinkedIn’s retargeting tool offers three types of Matched Audiences: website retargeting, account retargeting, and contact targeting. This allows advertisers to retarget website visitors, target specific companies or account lists, or upload a list of email addresses for targeting.

Some benefits of using LinkedIn Matched Audiences include:

1. Professional targeting: LinkedIn is a platform primarily used by professionals, making it ideal for B2B marketing efforts.
2. Account-based marketing (ABM): LinkedIn’s account retargeting feature is perfect for businesses looking to engage with specific companies as part of their ABM strategy.
3. Improved ad relevance: Retargeting campaigns created with LinkedIn Matched Audiences are generally more effective due to their tailored approach.

Twitter Tailored Audiences

Twitter Tailored Audiences is the retargeting tool available on the Twitter advertising platform. Like other retargeting tools, Twitter Tailored Audiences allows businesses to target users who have previously engaged with their website or brand. This tool helps increase the relevance of your Twitter ads, leading to higher engagement and conversion rates.

Some advantages of using Twitter Tailored Audiences include:

1. Large user base: Twitter has millions of active users, providing a broad reach for your retargeting campaigns.
2. Multiple targeting options: Twitter allows businesses to create various audience segments based on website activity, mobile app usage, or existing customer data.
3. Improved ad performance: The tailored approach of Twitter Tailored Audiences leads to more relevant and engaging ad campaigns.

Criteo

Criteo is a leading retargeting platform that specializes in personalized display advertising. With a vast network of publisher partners and a wealth of user data, Criteo helps businesses create retargeting campaigns that are highly relevant and visually appealing. Criteo’s performance-driven algorithms ensure your ads are only shown to users most likely to engage with your brand or make a purchase.

Criteo’s key features include:

1. Cross-device retargeting: Criteo tracks user behavior across multiple devices, creating a unified user profile for improved targeting.
2. Dynamic creative optimization: This feature ensures your ads are visually engaging and personalized for each user, increasing the likelihood of engagement.
3. Scalable platform: Criteo’s platform can handle high volumes of data and web traffic, making it suitable for businesses of all sizes.

AdRoll

AdRoll is a retargeting and prospecting platform that helps businesses drive conversions through personalized ads. With AdRoll, you can create retargeting campaigns for a variety of platforms, including the Google Display Network, Facebook, Instagram, and Twitter. AdRoll’s artificial intelligence algorithms ensure your ads are optimized for performance and shown to users most likely to convert.

Some features of AdRoll include:

1. Cross-platform retargeting: Create a cohesive retargeting strategy across multiple channels, including social media platforms and the Google Display Network.
2. Advanced audience targeting: AdRoll provides access to over 500 audience segments based on interests, demographics, and even customer intentions.

Perfect Audience

Perfect Audience is a retargeting platform designed for businesses that want to reach their audience across multiple channels, including the Google Display Network, Facebook, Twitter, and more. With an easy-to-use interface and advanced targeting options, Perfect Audience is an excellent choice for businesses of all sizes.

Features of Perfect Audience include:

1. Cross-channel retargeting: Run retargeting campaigns across various platforms, ensuring a cohesive marketing strategy.
2. Conversion tracking and analytics: Monitor your campaign’s performance with detailed reports and data analysis.
3. Flexible pricing: Pay only for the clicks or impressions you receive, allowing for easy budget management.

ReTargeter

ReTargeter is a retargeting platform that offers a complete suite of display advertising solutions, including site retargeting, search retargeting, and contextual targeting. With ReTargeter, businesses can create personalized display ads that reach their audience on various websites and platforms.

Some benefits of using ReTargeter include:

1. Comprehensive retargeting options: ReTargeter offers multiple retargeting methods, allowing businesses to create a strategy that best fits their needs.
2. Cross-platform reach: ReTargeter partners with numerous publishers and platforms, ensuring a broad reach for your retargeting ads.
3. Full-service support: ReTargeter provides design assistance, dedicated account management, and campaign optimization, ensuring a seamless and effective retargeting experience.

Designing a Retargeting Campaign

Retargeting campaigns are designed to re-engage customers who have shown interest in your brand, product, or services but didn’t convert. They can be highly effective when executed properly, helping to increase conversions, improve brand recognition, and generate more sales. Here are the essential aspects to consider when designing a retargeting campaign:

Defining Your Retargeting Goals

1. Increasing conversions: Focus on persuading customers who’ve visited your site or engaged with your content but haven’t made a purchase. This is one of the most popular goals for retargeting campaigns, as it directly increases revenue.

2. Building brand awareness: Retargeting can help keep your brand top of mind with potential customers, even if they didn’t convert initially. You can strengthen your brand’s presence by showing ads to users who have shown interest in your products or services.

3. User re-engagement: For businesses with a product or service that requires frequent interaction, retargeting campaigns can be used to encourage customers to return and engage after a certain period of inactivity.

Segmenting Your Audience

Segmenting your retargeting audience allows you to deliver more personalized and relevant ads to different groups of people. This is essential for maximizing the effectiveness of your campaign. Consider segmenting based on:

1. Site behavior: Users who visited specific pages or took specific actions (like adding an item to their cart) may be more likely to convert than others.

2. Purchase history: Tailor your ads to your customer’s past purchases, upselling, or cross-selling related products.

3. Demographics: Test different ads and messaging based on age, gender, location, and other demographic factors.

4. Time since last visit: Adjust your ad frequency and messaging for those who recently visited your site compared to those who haven’t engaged in a while.

Setting a Suitable Retargeting Duration

The retargeting duration, or cookie window, refers to the length of time that a user remains in your retargeting audience after visiting your site. This duration should align with your retargeting goals, taking into account factors such as the typical buying cycle for your industry and the anticipated lifetime value of a customer. Too short of a window may result in missed conversion opportunities, while too long of a window may annoy your audience with repetitive ads.

Creating Visually Appealing Ads

The design and messaging of your retargeting ads can greatly impact their effectiveness. Consider the following principles when creating your ads:

1. Use clear, compelling visuals: Your ads should be visually interesting and relevant to the audience segment they are targeting.

2. Maintain brand consistency: Make sure your ads are cohesive with your overall brand identity.

3. Include a clear call-to-action (CTA): Guide users to the next step by providing a clear CTA. Ensure your CTAs are concise, specific, and action-oriented.

4. Highlight special offers or incentives: If you’re offering a discount or limited-time promotion, make sure it’s clearly stated in your ad.

Testing Multiple Ad Variations

To optimize the performance of your retargeting campaign, it’s essential to test different ad variations to determine what resonates best with your audience. Try varying the messaging, visuals, layout, and CTA to see which combinations drive the most engagement and conversions.

Setting an Effective Frequency Cap

A frequency cap is a limit on the number of times a user sees your ad within a specific timeframe. An excessive frequency can lead to ad fatigue, where users begin to ignore or even become annoyed by your ads. By setting a reasonable frequency cap, you can balance the need to stay top of mind with potential customers and avoid overwhelming them with too many impressions. Test different frequencies and monitor the performance to find the sweet spot for your target audience.

Measuring and Optimizing Retargeting Campaigns

Overview of Key Performance Indicators (KPIs)

Key Performance Indicators (KPIs) help measure retargeting campaigns’ success. These metrics help to evaluate whether the campaign is achieving its goals and provide insights into areas that require improvement. Some common KPIs for retargeting campaigns include conversion rate, return on investment (ROI), cost per acquisition (CPA), click-through rate (CTR), and time spent on site. To effectively optimize retargeting campaigns, it’s important to establish which KPIs are most relevant to the goals of the campaign and monitor those closely to make adjustments as needed.

Tracking Conversions and ROI

Conversions are crucial to measure the effectiveness of a retargeting campaign for it shows if the ads are generating the desired actions from the audience, such as sales, sign-ups, or downloads. Conversion tracking involves setting up and monitoring specific goals, such as the completion of a purchase or filling out a form. Analyzing conversion data provides valuable insights into which ads, creatives, and placements are driving the most conversions, which can inform the decision to adjust or expand the targeting strategy as needed.

Monitoring Impressions and Clicks

Impressions and clicks are essential metrics to monitor in a retargeting campaign because they indicate the frequency and reach of your ads and, more importantly, whether those ads resonate with your target audience.

Impressions measure how often your ads are shown to users, while clicks indicate the number of users motivated enough by the ad to engage with it, such as by clicking on the ad to visit your website. Monitoring impressions helps you understand your campaign’s general exposure and reach while tracking click-through rates (CTR) can provide useful insights into your ad’s effectiveness in attracting users.

Analyzing Audience Engagement

Audience engagement is crucial for the success of any retargeting campaign. Assess engagement by monitoring metrics such as average time on site, bounce rate, and pages per session. High engagement levels indicate that the audience is interested in your content, while low engagement could be an indicator that your ads or retargeting strategies are not resonating with users.

Analyzing engagement metrics will help you identify whether your messaging and targeting are effective, and will also inform potential adjustments to your overall strategy that could enhance results.

Refining Ad Creatives and Messaging

The effectiveness of your retargeting campaign largely relies on the visual impact and messaging displayed in the ads themselves. Regularly reviewing ad creatives and messaging consistency can greatly improve the individual performance of each of your retargeting efforts.

Adjusting Frequency and Durations

Ad frequency and duration are important factors that can influence the success of a retargeting campaign. Reaching the right balance in ad frequency and exposure time ensures that users have sufficient opportunities to engage with the advertisement and be reminded of your product or service, while not overwhelming them with excessive ads that could lead to ad fatigue.

Utilizing A/B Testing for Continuous Improvement

A/B testing is a valuable technique for optimizing retargeting campaigns by providing insights into what elements of an ad are most effective in driving engagement, clicks, and conversions. During A/B testing, marketers can test different variables such as design, messaging, ad placement, and targeting methods, to compare campaign effectiveness.

Retargeting Best Practices and Tips

Retargeting is a crucial component of a successful digital marketing strategy. It allows businesses to engage with individuals that have previously visited their websites or interacted with their content. Retargeting aims to bring those visitors back and convert them into customers. Here are some best practices and tips to make your retargeting campaigns effective.

Understanding Your Audience’s Needs and Preferences

To maximize the impact of your retargeting campaign, you need to understand your audience’s needs and preferences. Analyze their behavior on your website or use data from other marketing channels to segment your audience based on their interests, purchasing behavior, and demographic information.

By doing this, you can create personalized ads that cater to each segment’s unique preferences. Tailored messaging improves the chances of visitors returning to your website and performing the desired action, such as purchasing your product or signing up for your newsletter.

Maintaining a Diverse Retargeting Strategy

A diverse retargeting strategy is essential to ensure you are reaching your audience via multiple touchpoints. Here are some key tips to ensure diversity:

1. Use multiple platforms: Utilize different advertising platforms such as Google Ads, and social media channels like Facebook, Twitter, LinkedIn, or Instagram to increase reach and visibility.

2. Experiment with different ad formats: Explore various ad formats, such as display ads, video ads, carousel ads, or sponsored content, to see which resonates best with your target audience.

3. Personalize ad creatives: Customize the ad creatives for each segment of your audience to make the ad more relevant and appealing to each group.

4. Leverage lookalike and custom audiences: Use custom audience targeting to reach specific users who have already engaged with your brand, while lookalike audiences allow you to target new potential customers with similar interests based on demographics and behavior patterns.

Aligning Retargeting with Your Overall Marketing Plan

Retargeting should be integrated with your overall marketing plan to ensure consistency across all channels. Consider the following factors when aligning your retargeting strategy:

1. Campaign goals: Align your retargeting campaign goals with your broader marketing objectives, such as increasing sales, boosting brand awareness, or generating leads.

2. Messaging and branding: Ensure consistent messaging and branding across retargeting ads and other marketing channels. This provides a seamless experience for the user and reinforces brand recognition.

3. Scheduling and frequency capping: Optimize the duration and frequency of your retargeting ads to avoid overwhelming users with too many ads while also ensuring they remain engaged with your brand.

4. Attribution and ROI: Monitor the performance of your retargeting campaign and measure its return on investment (ROI). Analyzing the data will help you optimize the campaign and align it better with your overall strategy.

Respecting User Privacy and Adherence to GDPR/CCPA Regulations

Retargeting campaigns must comply with data protection regulations such as the General Data Protection Regulation (GDPR) in the European Union and the California Consumer Privacy Act (CCPA) in the United States. Ensure your retargeting strategy complies with these regulations by:

1. Clearly informing users about the use of cookies and the purpose of data collection.
2. Obtaining explicit consent from users before collecting and processing their data.
3. Implementing an easy-to-use mechanism for users to opt out of retargeting ads or modify their preferences.

Ensuring a Positive User Experience with Non-Intrusive Ads

Finally, create a positive user experience by delivering non-intrusive ads that don’t disrupt the browsing experience. Consider the following best practices:

1. Avoid using aggressive ad formats or placements that obstruct website content or are overly distracting.
2. Use frequency capping to limit the number of times a user sees your ad, preventing them from becoming annoyed or developing “ad fatigue.”
3. Continuously monitor and optimize your retargeting campaigns to ensure ads remain relevant, timely, and valuable to users.

Retargeting Tools – FAQs

1. What are retargeting tools, and why are they essential for marketers?

Retargeting tools are digital marketing technologies designed to target users who have previously interacted with a brand’s online presence (e.g., their website or social media). These tools enhance a brand’s conversion rate by delivering personalized ads based on user behavior to re-engage potential customers (Chaffey & Ellis-Chadwick, 2016).

2. How do retargeting tools differ from traditional display advertisements?

Traditional display advertisements reach a broad audience while retargeting tools focus specifically on users who have already shown interest in a business. By leveraging visitor data, retargeting tools serve highly relevant ads experience, leading to improved engagement and conversion rates (Ghose & Todri, 2016).

3. Which platforms offer retargeting tools for advertisers?

A variety of platforms provide retargeting tools, with some of the most popular including Google Ads, Facebook Ads, AdRoll, and Criteo. Each platform offers its unique features and targeting options to optimize advertising campaigns and reach optimal conversion rates (Duffett, 2017).

4. Are there any privacy concerns associated with retargeting tools?

Privacy concerns arise with retargeting tools, given that they track users’ online behavior. Businesses must be transparent about their practices and comply with data protection regulations (e.g., GDPR, CCPA) to respect users’ privacy rights (Castaneda & Montoro-Rios, 2017).

5. Can retargeting tools be used for both B2B and B2C marketing efforts?

Absolutely, retargeting tools are versatile and can benefit both B2B and B2C marketing strategies. Regardless of the target audience, these tools drive higher engagement and conversion rates by presenting relevant ads tailored to users’ browsing behavior (Fjell, 2017).

6. How can one measure the success of retargeting campaigns?

Key performance indicators (KPIs) such as click-through rate (CTR), conversion rate, and return on ad spend (ROAS) can help measure the effectiveness of retargeting campaigns. These metrics provide valuable user engagement and conversion insights, facilitating campaign optimization (Lamberton & Stephen, 2016).