A technique of displaying ads again on other websites or social media to users who have previously visited your website. By repeatedly reaching out to users who are considering a purchase, it aims to improve conversion rates. Also known as remarketing.
How Retargeting Works and Its Types
Retargeting uses cookies or pixel tags stored in the user's browser to track site visitors. The typical retargeting experience is seeing an ad for a product you browsed on an e-commerce site later appear on a news site or social media platform.
The main types include "site retargeting" which shows ads to all site visitors, "dynamic retargeting" which displays ads for the specific products a user viewed, and "custom audiences" which delivers ads based on customer lists such as email addresses. Google Ads and Meta Ads (Facebook/Instagram) are the major retargeting platforms.
Retargeting Effectiveness and Important Considerations
Retargeting ads reportedly achieve 2-3x the click-through rate and 3-5x the conversion rate of standard display ads. Since they target users who have already shown interest in a product or service, it is natural that they outperform ads aimed at new users. Notifying users who abandoned their cart with "did you forget something?" is one of the most effective applications of retargeting.
On the other hand, excessive retargeting creates an uncomfortable feeling of being "followed." Setting a frequency cap (limiting the number of ad impressions per user) to around 3-5 times per day is standard practice. Additionally, with strengthening privacy regulations and the move toward cookie deprecation, traditional retargeting faces increasing constraints going forward, making first-party data utilization increasingly important.
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