As of July 2022, the average e-commerce conversion rate was a mere 1.92%. That means more than 98% of website visitors fail to convert to paying customers. 

While conversion rates vary across industries and geographic regions, one thing is clear: online businesses need to find ways to make more sales. 

Conversion rate optimization is a puzzle with many pieces, but one of the most important is remarketing ads. 

Remarketing is a way to capture leads and close sales with people who visit your website but leave without making a purchase. As such, it’s an essential component of any digital marketing strategy.

This article will provide a brief introduction to remarketing, its benefits, and best practices for your retargeting ad campaign. 

Let’s dive in.

What Is Remarketing?

Remarketing ads — also known as retargeting ads — are a method of online advertising designed to turn site visitors into potential customers. 

When a customer leaves your website without making a purchase, you create a retargeting campaign to show them ads across social media, websites, and even email.

You can create remarketing display ads for different platforms, including: 

  • Google Display Network websites
  • Gmail
  • YouTube
  • Apps
  • Advanced DSPs (DV360, The Trade Desk, Amazon), through a partner like Grapeseed Media.

Using these platforms, you can show banner ads or video ads to past visitors and encourage them to return to your website and make a purchase.

Types of Remarketing Ads

Standard remarketing involves showing ads to users as they navigate through websites that use Google Display Network, as well as social media platforms like Facebook. 

There are two main types of email remarketing ads. The first is serving display campaigns to users who open an email from your company. The second is using email to follow up with people who have visited your website and exited before making a purchase. 

Video remarketing ads are video ads that you can target to previous website visitors, before or during online video content across many websites, including YouTube.

Dynamic remarketing serves ads to website visitors based on their behavior. For example, an e-commerce website can serve an ad with the exact items a user left in their abandoned cart, increasing the chances of closing the sale. 

Another example of this is if a visitor spends time looking at the pricing page before exiting your website, you can retarget them with a discount or free trial. 

Mobile app remarketing can remind users to use your app after downloading it. Alternatively, it can be used to target users who have visited your app’s landing page but haven’t yet downloaded it. 

Retargeting lists for search ads is a service offered by Google AdWords. It allows you to customize your search ad campaigns and tailor them to past visitors of your website.  

What Are the Benefits of Remarketing?

Let’s take a look at four of the main reasons remarketing is such an effective strategy. 

1. Increase Brand Exposure and Awareness

These days, people rarely buy from unfamiliar brands. In the digital age, customers are discerning and tend to only buy from brands they know and trust.

Plus, the famous ‘rule of seven’ — that states a customer needs to receive your advertising message at least seven times before taking action — is still as relevant today as ever. Remarketing is a way to increase the number of touch points with potential customers and improve their chances of converting. 

According to Invesp CRO, 42% of marketers use retargeting to increase brand awareness, and three out of four users now notice retargeting ads — making them an effective method for raising brand awareness.

2. Higher Conversion Rates

Remarketing ads can help you improve conversion rates and increase sales — in fact, 26% of customers will return to a website through retargeting, according to Invesp CRO. 

What’s more, website visitors who are retargeted with display ads are 70% more likely to convert to paying customers through your website.

3. Improved Cost Efficiency

With remarketing ads, you get more bang for your buck than with standard display ads — the average click-through rate (CTR) for display ads is 0.07%, while the average CTR for retargeted ads is 0.7%.

4. Personalized Advertising

The contextual and personalized nature of remarketing ads means that retargeted customers are three times more likely to click on your ad than users who have never interacted with your business before. 

How to Use Remarketing

Some marketers take an ‘always on’ approach to remarketing, constantly running ad campaigns for all website visitors who don’t convert. 

While this may work for some, there’s also the risk of sabotaging your marketing efforts through overkill, as users can get annoyed by seeing the same ads repeatedly. To avoid this, put a cap on how many times an ad is shown to each user per day — it should be no more than three.

Some customers also have privacy concerns around retargeting ads. According to Invesp CRO, 54% of users feel ‘very concerned’ or ‘somewhat concerned’ after seeing retargeted ads. They may feel that the use of cookies for retargeting is a violation of their privacy or like they’re being spied on.

How to Gather Data for Remarketing Campaigns

A successful remarketing campaign begins with creating audience lists. There are two main ways to do this: pixel-based remarketing and list-based remarketing. 

Pixel-Based Remarketing

Pixel-based remarketing uses a piece of JavaScript code to place cookies into users’ browsers. The cookie tracks their behavior on the website, such as which pages they visit. 

When the person exits the website, the cookie sends a notification to the ad networks provider, notifying them to start showing ads to the user. 

The advantage of pixel-based remarketing is that it’s timely and specific to a particular page of your website. 

However, it often means having fewer people being targeted by the campaign as the ads expire if the user doesn’t return to your website within 30 days. 

Additionally, Google will phase out cookies by 2024, so marketersre are now working to find new solutions to track user behavior when the cookie is deprecated.

List-Based Remarketing

With list-based retargeting, you upload a list of emails of past or potential customers. The retargeting platform then identifies users with those email addresses and shows them custom ads. 

With list-based remarketing, you can create multiple lists based on different actions, and they never expire. However, you’ll need to manually remove users from the list to stop showing them the ads. 

This type of targeting can create a more personalized ad experience, but you may miss out on users who use different email addresses across different platforms.

Best Practices for Display Ad Remarketing

Ready to start using remarketing to make more sales? Here are three tips to help you optimize the process.

1. Set Remarketing Goals and KPIs 

Before you launch your remarketing campaign, you’ll need to decide how you’re going to measure its success. Consider tracking the following six key metrics. 

Lead Conversions — the number of leads that come directly from your retargeting ads. Generating new leads is important because it helps you increase your number of prospects.

View-Through Conversions — sometimes, people convert after seeing your ad and going straight to your website without clicking on the ad. These are known as view-through conversions, and capturing this data gives you a more complete picture of the success of your ad campaign.

Site Visits — there are different ways to measure site visits. You might calculate them by adding the number of clicks on the ad to the number of view-through conversions. Alternatively, you can measure your website traffic before and after running your remarketing campaign. 

Nurture Touches — these are bottom-of-funnel retargeting activities aimed at your existing contacts. These ads can help you generate leads who are ready to convert and identify untapped sales-ready leads from your current email list. 

Marketing Qualified Leads (MQLs) — MQLs are leads who have been qualified by the marketing team. Measuring MQLs can give you an accurate idea of the types of leads that turn into customers and represents the true value of your retargeting ad spend. 

Email Opens — this is the number of customers who open your emails before and after your retargeting campaign. This number is important since it allows you to identify inactive email list segments and send them nurture emails to increase engagement.

2. Define Your Target Audience and Segment Your Remarketing Lists

For your retargeting ads to be effective, they must be highly personalized and based on user behavior. To achieve this, you’ll need to identify potential customers through audience targeting and segmentation.

Use demographics, online behavior, and geotargeting to target people who fit your ideal customer profile. Then, divide them into custom audiences that you will use to create different retargeting ads. 

3. Optimize Your Campaigns

Ad campaigns are always a question of measuring and re-measuring to see what works and what doesn’t to optimize your campaigns accordingly. 

A few ways to optimize your remarketing ads include:

  • Experimenting with new platforms
  • Varying your ad formats and sizes
  • Choosing your best products or services to offer through retargeting
  • Scheduling ads for when your target audience is most likely to see them
  • Prioritizing ads on the platforms and websites that perform best
  • Creating a dedicated landing page for each segment of your audience
  • Adding sites and apps that meet your audience where they are
  • Removing sites and apps that don’t produce effective results
  • Adjusting device-type targeting based on higher performing devices

Optimizing your campaigns should be a constant process of measuring, refining, and retargeting to fully optimize your ads for your target customers.

Make More Sales With Remarketing Ads

Retargeting is a cost-effective and efficient way to turn more of your leads into prospects and close more sales. 

Many of the strategies outlined in this article can be implemented through automation and programmatic ads — saving your sales team time on manually combing through contact lists and qualifying leads.

However, if you’re a small business or a busy agency with limited resources, you might want to consider partnering with a specialist in programmatic digital advertising like Grapeseed Media. 

We help brands achieve measurable ROAS through data-driven advertising campaigns. Get in touch with us today to learn more about our digital advertising solutions.