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May 14, 2019

Retargeting vs. Remarketing: What’s The Difference?

Retargeting vs. Remarketing: What’s The Difference?

A rock-solid digital marketing plan should include effective remarketing and retargeting strategies. When less than three percent of first-time visitors to e-commerce websites turn into customers, retargeting and remarketing are crucial. But what are they and how do they work?

Retargeting and remarketing share the common goal of re-engaging people who have previously visited your website and shown interest in your products or services. What sets them apart is how they do it.

Retargeting uses digital ads to re-engage leads. The ads are displayed on other websites or social media.

Remarketing re-engages leads with email instead of digital ads. Some online tools use the term “remarketing” to refer to “retargeting” activities, which can be confusing.

Here's a closer look at both topics and things you should keep in mind when considering them.

How Does Retargeting Work?

Retargeting campaigns begin when someone visits your website. A small file called a cookie is placed in the visitor’s browser. The cookie keeps track of the visitor’s activity while on your site, but it doesn’t capture any sensitive information like the visitor’s name, address, or email address.

When the visitor leaves your website the cookie has a record of what the person found interesting. That information is then used to display ads to the person for those products or services. “Display ads”, as they’re called, are shown on other websites or through social media.

Here's a list of the most common places to use display ads:

  • Google Display Network
  • Facebook
  • Instagram
  • LinkedIn
  • Twitter

The Google Display Network includes over 2 million websites and reaches over 90% of people on the internet.

The purpose of your retargeting ad may be to build brand awareness or to get the person to return to your website and complete a transaction. One of the wonderful things about digital marketing is that both are measurable.

So far we've been learning about off-site retargeting; retargeting that isn't happening on your website. Another type of retargeting is on-site retargeting.

On-site retargeting, also known as behavioral targeting, is what you display to repeat visitors to your website. On-site retargeting uses the data in the cookie to tailor the user’s experience.

Here’s how the visitor’s profile can be used for on-site retargeting:

  • Demographics, such as sex and age.
  • Interests
  • Position in the flywheel or sales funnel
  • Page visits
  • Page depth
  • Page entry
  • Page exit

Banner ads, pop-up ads, and page content are examples of things that can be displayed to visitors using on-site retargeting.

How Does Remarketing Work?

Remarketing uses an event or circumstance to send an email to a person who might take action on it. Since you must have an email address, you’ll have fewer chances to re-engage the person than with retargeting. However, the person’s willingness to give you their email address is a stronger signal of interest and should translate to a higher click through rate.

The most common example of remarketing is the cart abandonment email. If you do any online shopping, I’m sure you’ve seen an abandoned cart email. The email reminds you that you have stuff in the shopping cart and makes it easy to return and complete the transaction.

Here are a few other types of remarketing email campaigns:

  • Wishlist Sale or Reminder
  • Last Chance to Purchase
  • Repetitive Purchases (such as for consumable products or holidays)
  • Add-ons and Related Products
  • Most Popular or Trending Products
  • Back In Stock

Which Should You Use?

Both activities have their pros and cons.

Retargeting Considerations

When compared to remarketing, retargeting potential customers is a little easier. It doesn’t require you to capture an email address. All you need is for the target user to visit your website.

Previous visitors to your website who see a related display ad are 70 percent more likely to become customers. And the click through rate of display ads for retargeting is ten times higher than those that aren’t. Those are pretty attractive stats!

Retargeting is a “pay for” activity. To have your ad served to your targeted prospects you’ll have to pay for them on a pay-per-click or pay-for-impression basis. Regardless, if you have an effective retargeting marketing strategy it has tremendous potential.

While retargeting is an attractive option, be careful. It can be overdone. An overly aggressive retargeting campaign can foster negative sentiment. At some point your online ad will start to work against you.

Remarketing Considerations

Although remarketing has a higher bar (you need your prospect’s email address), you should be able to realize a higher conversion rate. After all, these people have shown so much interest that they’ve given you their email address. In some cases, they’ve told you exactly what they want to buy!

Abandoned cart emails are opened by 46% of the people who receive them! Of those, 13% click on a call-to-action in the email, and more than 35% of those end up buying something.

Don’t forget about the other types of remarketing campaigns. The open rate of a classic email marketing is 21%. The other types of remarketing email perform better than this. Marketing Sherpa found that the open rate of back in stock emails have an open rate of 36.5%, a click through rate of 26%, and a conversion rate of 25%!

While you don’t pay for emails, remarketing campaigns will benefit from the advanced features in tools like HubSpot, MailChimp or Constant Contact. These features typically require a paid subscription.

Like retargeting, remarketing can also be overdone. Sending too many emails or emailing a person too frequently may irritate your prospect. Email addresses are valuable! Don’t pester your customers so much that they click the unsubscribe link in search of relief.

Getting Started

The good news is that you don’t have to choose! Each method is best used to re-engage customers who have shown different levels of interest in what you offer. They both have a role to play in your digital marketing plan.

Use retargeting ad campaigns to re-engage people who are at the top of the sales funnel. Use remarketing for people who’ve expressed the most interest in your products by adding something to the cart, placing a product on a wishlist or signed up to be notified when something is back in stock.

About Eniture Technology

Eniture Technology specializes in helping e-Commerce merchants grow by providing useful information, digital marketing services, off-the-shelf apps that solve common problems, and custom programming services. Please contact us if you need help growing your online business or implementing the concepts presented in this blog post.

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