Retargeting – Short Conceptual Explanation

Retargeting is a term used in online marketing to describe how ads can be personalized for internet users. A user will see advertisements for the products and services on a website that he has previously visited or will visit on other websites. This allows companies to recapture the attention of website visitors who left without taking action and redirect them back to the site.

Retargeting

How retargeting works

The process of retargeting relies on the use of cookies. A cookie is a piece of code that is used on a website that is unobservable to users and doesn’t affect the site’s performance. When users visit the website, the code deposits a cookie on their computer so it knows that it’s a website they have visited before. When that person gets back on the web, those cookies are used by retargeting providers to display ads for the website on other sites throughout the internet. It’s how a user can see an ad for a pair of leggings they were looking at earlier on someone else’s blog.

Ads are only shown to people who have visited the website before, making them more effective than cold advertising.

Types of visitors that are targeted

Many different kinds of website visitors can be targeted. Retargeting providers can capture information on a wide variety of users that include:

  • Basic Users: These are users who have visited the website but haven’t taken any action. Retargeted advertisements for these users usually involve promoting the company or brand itself.
  • Previous Interest: These users have browsed the website for a long time and items they spent time viewing can be used in targeted advertisements.
  • Determination to Buy: These users are actively comparing products with the intent to buy. An advertisement for a discount or free shipping can get them to take action.
  • Purchase Aborted: These users have items in their cart but haven’t made the purchase. A cart reminder is a simple strategy that can be used in this case.
  • Existing Customers: These users are already customers who will respond to useful tips or ads with new product releases.
Retargeting

Effectiveness of retargeting

Retargeting can get a bad rap among internet users because it requires accumulating massive amounts of user data. There is a long list of companies that have experienced a data leak prompting consumers to become concerned about the type of data that is being captured and how it is being used by companies.

Most companies responded with more in-depth cookie policies, instead of eliminating the use of retargeted ads because they are extremely effective.

For example, website visitors who are retargeted with display ads are 70-percent more likely to convert than those who see random ads. In addition, the click-through rate of a retargeted ad is 10 times higher than other ads.
Not all internet users are against retargeting either. The majority of internet users don’t feel one way or the other about viewing targeted ads on the internet when they’re browsing the web. What’s more surprising is that as much as 25-percent of internet users enjoy targeted advertising because it reminds them of products they were browsing that they may h