Retargeting Ads: Definition, Types, and Benefits

Retargeting Ads: Definition, Types, and Benefits

Ashwin Krishnakumar
Ashwin Krishnakumar

Chief Technology Officer, Airtory

Published on: 01 Mar 2022

Reading time: 6 minutes

Retargeting is a type of digital advertising that helps a brand connect with and engage an audience that has interacted with the brand in the past or has visited the brand’s website but did not make a purchase. The main aim of this type of advertising is to remind customers of your brand, which in the long run, helps improve conversion.

With many successful examples of retargeting ads spread across the digital landscape, it is a proven fact that these types of ads can help improve ROI.

What Are Retargeting Ads?

Retargeting ads are not that different from ‘targeting ads’ but are sent to users who have already interacted with your brand in the past. They serve as reminders for people who are aware of your brand but are yet to make a purchase from you.

Retargeting ads use the viewing history of users to target users that have checked out products on your site but did not make a purchase and use this information to show ads of similar products or your brand on other sites. Using an ad builder platform can help make the entire process of retargeting easier for advertisers.

How Does Retargeting Work?

Retargeting ads, in most cases, provide further information to users about the products they were researching which, in turn, helps with increased conversions even when compared to simple display advertising.

Retargeting works best when combined with inbound and outbound marketing as well as demand creation. Content marketing, AdWords, and targeted display strategies are well-suited for increasing visitors but don't always help with conversion optimization. Retargeting, on the other hand, can assist with increased conversions but cannot bring new visitors to your site. Using one or more techniques to drive traffic and retargeting to get the most out of that traffic gives you the best chances of success.

At present, a retargeting ad works using cookies which are an important part of retargeting. When a prospective customer visits your site, an anonymous browser cookie is placed on their device. When the user leaves the site without purchasing anything, the cookie intimates your servers about the same, after which you can target ads to that customer until they come back to your site to complete their purchase. 

A World Wide Web Without Cookies

However, Google’s announcement of blocking third-party cookies by 2023 is set to have a significant effect on how marketers will track consumers for retargeting. They will now have to switch their focus to privacy-friendly, first-party datasets that are more impactful for improving the performance of your campaigns. This may involve using standardized user IDs for advertising that will help eliminate aspects of retargeting that slow down the customer experience. 

The ‘cookie-less’ future of ‘privacy-first web’ will do away with microtargeting. Consequently, marketers will have to shift towards broader targeting based on interest-based cohorts, the efficacy of which will come to light once it all comes into action.  

Till that comes into play, here are some of the most popular types of retargeting ads that marketers can use in their digital campaigns:

  1. Account-based retargeting

An efficient B2B strategy for retargeting, this approach is used to acquire prospects or to upsell to your existing target audience (accounts). It is a suitable approach for capturing the interest of important customers that you wish to retain or acquire. 

  1. Search-based retargeting

This type of retargeting targets audiences and users based on their keyword searches on important search engines. The combination of search engine marketing and display advertising results in an effective strategy that can be personalized and optimized to improve ROI.

  1. Site retargeting

A popular type of retargeting, this strategy involves pixel-based retargeting. A visitor to your website can be tagged and you can then follow them across the digital space with your communication. During this process, you can identify which user actions can be termed as ‘tag-worthy’, after which you can serve ads to them accordingly.

  1. SEM/ SEO retargeting

Similar to site retargeting, this strategy is more about the search terms that a user entered before they clicked on the link that brought them to your site. This allows you to get a deeper insight into their intent, which can be used to refine the retargeting message for them.

  1. Contextual retargeting

This involves pixels being exchanged between websites with complementary businesses that are relevant to the user, so both brands can target each other’s prospective customers as well.

Benefits of Retargeting Ads

Retargeting in advertising can significantly influence marketing campaigns as there are numerous benefits of retargeting ads that marketers can avail.

  1. Better Engagement

When customers come across retargeting ads frequently, they show more interest in a brand’s products or services. These ads prompt them to re-interact with your brand, which in turn leads to better engagement.

  1. Track customer journeys

Retargeting ads basically work on user behavior across the digital space, and based on the retargeting ads they are shown, marketers can also trace the user’s online journey, gaining deeper insight into their buying behavior.

  1. Generate brand awareness

People tend to buy only from brands that they know and trust and won’t buy from a new brand till they know them better. That is why brand awareness is of prime importance and retargeting ads help with the same.

  1. Improved conversions

Re-engaging with a brand that a user has interacted with in the past shows more affinity towards making a purchase, which helps improve conversion rates as well.

  1. Increased Customer Lifetime Value

Regularly seen retargeting ads make customers more likely to trust your brand and be interested in your products or services. After purchasing your product, if they love it, they will be back for more, which results in an improved customer lifetime value.

Creating a Retargeting Campaign

Retargeting marketing strategies can be created to be as straightforward or as complex as you wish. Depending on the targeted CTA, a campaign can urge users to visit a homepage, provide their email address via opt-in forms, fill out appointment forms, register for a webinar, or make a purchase.

Identify the call to action and then create a sequence that can help drive prospects to your objective when designing your retargeting campaign. You may make sequences as simple as a user viewing a product page and then seeing advertisements for that product, or as complex as a full sales funnel or multi-step sequence that results in a sale.

You can create a retargeting sequence to gain the confidence of your target audience and to encourage them to sign up with you. The following is an example of how the retargeting technique may work in promoting a webinar:

  • Users who come to your blog post via an internet ad or a search engine query will be tagged for pixel retargeting.
  • The ad sequence can be triggered by markers for an article's individual web address.
  • The first ad served could be a video that quickly introduces your business and describes what you do and can be utilized on days one to four after the client enters your website.
  • Five to eight days after the customer’s visit, a second ad (link to an article on the advantages of the webinar) can be served.
  • When a user registers for the webinar, you can fire another pixel that removes them from the first retargeting list and places them on a second list that reminds them to attend the webinar.

Retargeting reminds your visitors of the existence of your brand even after they leave your website and can drive them to respond to the desired call to action, providing you with a second chance to convince or sell to someone who is already familiar with your company offerings. The best retargeting platforms allow you to provide visitors with an immersive ad experience that can significantly improve your conversion rates.

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