Explaining Modern Marketing to My Mom: Part 5 (Retargeting)
The inspiration for this latest post was an email I received recently from my mom Julia:
Hey Martha, the other day I was looking on a website to buy a little sink. It turns out they don’t ship to Canada, but I still keep getting the sidebar ads. Why are they following me? This is a waste of their money!
Here’s my reply:
Hey mom! I’m not surprised that this question was coming. You have been complaining about this type of advertising for years. What you’re referring to is called “Retargeting” (sometimes it’s also called “Remarketing”). Here is how it’s supposed to work (later, I’ll offer some tips for marketers to help them get the most out of their retargeting strategy – and stop irritating visitors like you!).
You visit a website (in your case, the seller of the little sink you were looking at), then you leave (maybe to take the dog for a walk). When you come back from your walk and starting surfing the web again, you start seeing advertisements for that little sink everywhere you go.
The company that sells the little sink has a small amount of code on their site that triggered a cookie to be dropped onto your web browser when you visited their site. A cookie is a small file that stores information, such as the visitor’s name, address or any other piece of information that might personally identify the visitor.
Later, when you get back to surfing the web, the cookie lets the retargeting provider know that they should serve you the little sink ads. In this type of advertising, the sink company wants to ensure that they are showing ads to people that have visited their site. In your particular case, the sink company also knows what product you were interested in, based on the product overview page you visited, so to further personalize the advertisement and target it directly to you, you are seeing the exact product you were – presumably – interested in buying.
Companies that use retargeting are trying to keep their brand in front of bounced traffic after they leave their website. They know that only 2% of first-time visitors to their site will actually make a purchase. The other 98% have shown some interest by going to the website in the first place, and marketers want to hang on to that interest and try to get these people to come back and buy something.
What I have described is site retargeting, as it is the most widely used in business-to-consumer (B2C) marketing, but there are also other types of retargeting such as search retargeting, email retargeting and CRM retargeting. It’s also important to point out that retargeting works differently in the business-to-business (B2B) context. Whereas in B2C, the retargeting offer you see will often be the product you looked at, or perhaps even put in your shopping cart, but didn’t end up buying. In B2B, the offer is more likely to be a piece of content like an eBook, video or guide to help educate businesses and inform their considered purchase decision. Many marketers have struggled to borrow and adapt retargeting tactics from the B2C world and make them work effectively in B2B. In a future post, I’ll look at how B2B marketers use – and sometimes misuse – retargeting.
But getting back to your B2C experience, Mom, you are not the only one who gets annoyed by these types of advertisements. One time around Christmas, I thought it might be funny to buy a few of these silly lights that you put in the bowl of your toilet (I know, Mom, don’t judge!). They have motion sensors so that when someone comes into the bathroom, it starts lighting up the toilet with multi-coloured lights. Mom, you’ll be happy to hear that I snapped out of it and left the site without buying, but for weeks, I was followed around the Internet by the multi-coloured toilet light. I saw it everywhere. It is very strange to see a display ad for light-up toilets appearing above a serious article on CNN. I screen-capped it as I hoped a day would come when I could share it with the world!
Retargeting Gone Wrong
There are a few common mistakes that organizations make when using a retargeting strategy to try to bring back their bounced traffic. Mom, I’m going to shift gears for a minute or two and talk to marketers, but keep reading as you’ll see how retargeting should work when it’s done right. Ok, for marketers who are reading this and have a retargeting strategy, here are 5 common retargeting mistakes to avoid if you don’t want to exasperate my mom and your other potential customers.
1. Your personalization strategy isn’t personalized enough
Your retargeting advertisements need to be personalized to be effective, and in order for them to be personalized, you must use segmentation as part of your strategy. Personalization is one of the main benefits of retargeting ads. You can choose to show an ad based on the actions the visitor has taken on your site. If someone was browsing gardening tools on your site, show them ads for gardening tools. If they also look at power tools, show them gardening tools and power tools.
2. You are showing the same advertisement over and over again
Your audience is seeing your advertisements all over the web thanks to your retargeting efforts. Bravo! But remember that your audience gets tired of seeing the same thing over and over and over again. The thinking is that if you see the same ad for, say, a pair of shoes that you looked at, your resolve might eventually weaken and you’ll cave and get your credit card out. But this can backfire and you can end up boring or even annoying your audience. Consider creating multiple advertisements and rotating them to keep it fresh and avoid ad fatigue. In B2B, this kind of impulse purchase just doesn’t happen when you’re talking about, say, a $100K piece of enterprise software that a person might purchase only once or a handful of times in their career, so again the retargeting tactics for B2B need to be different.
3. Your advertising frequency is way too high
Frequency is the average number of times a unique user sees your ad over a given time period. We just talked about ad fatigue – if you do not set frequency caps, you are at risk of over-advertising and annoying your potential customers. Setting hard caps on how many times an individual will see your ad is a good idea because, in all honesty, if a buyer hasn’t clicked on your ad after seeing it a handful of times, chances are they never will.
There is no golden rule for frequency; it should differ depending on what type of products you sell and the different journeys your buyers are on. A good practice is to align your retargeting efforts with your buying cycle. It is common for B2C companies to show their ads at a high frequency for a short amount of time and for B2B companies to show ads at a low frequency for a longer amount of time. This is because the buying cycle for B2C purchases tends to be short (you really do need that little sink) and much longer for high value, considered B2B purchases that involve buying committees.
4. Your retargeting ad doesn’t send people to a designated landing page
If you are successful in getting your audience to click on your retargeting ad and bring them back in to your site, you must make sure that you bring them to a page that has been designed to convert them (get them to make a purchase). Do not simply bring someone to your homepage and assume they will hunt around trying to find the offer they’re looking for. The destination should be relevant to the offer that they clicked on.
5. You haven’t sent up a conversion pixel on your post-conversion page
This is important. Businesses want to retarget the 98% of people that come to their site and leave without buying, not the 2% of people that make a purchase. You need to ensure that you are not targeting people who have already made a purchase. There is no point trying to sell them something they already bought, and you are wasting ad spend on customers who have already converted. If you want to advertise to this 2% who bought (e.g. to cross-sell), then retarget them with advertisements for products that complement the purchase they just made instead of showing them ads for the thing they just bought: You bought a little sink? Maybe you’ll like this bathroom vanity or towel rack to go with it.
Retargeting Done Right
Retargeting is powerful and can get some really good results if it’s done well. But as always, it requires a solid, well-thought-out strategy. Mom, you are right. It is a waste of money for this company that sells the little sink to advertise to you if they don’t ship to Canada. And it’s pretty irritating that they keep taunting you with ads for the sink you really want but can’t get! Maybe you should write them an email and tell them some of the retargeting tips you have learned from your amazing daughter!