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Display Advertising
From all the targeting methods on display networks, remarketing (or retargeting) is the most successful one.

Unlike other methods, with remarketing you target an audience of people that have already visited your website. This will give you the opportunity to only target people that have engaged with your brand already.

Now, this also means that with remarketing you are not targeting new visitors but previous website visitors. You should keep this mind when calculating the ROI of your remarketing campaigns.


How remarketing works


Remarketing works based on cookies. By adding a special piece of tracking to your website you can start tracking your website visitors. Based on their behaviour on your website we can define these into audience lists.


Remarketing works as follows:

  1. A visitor comes to your website (initial visit) and gets added to one of your remarketing lists.

  2. The visitor leaves your site.

  3. You start showing ads on other sites.

  4. The visitor re-engages with your website (second visit) and hopefully converts.


Description of how remarketing works.


Google remarketing


Now, the Google Display Network is the perfect place to start testing if remarketing works for your business. Especially if you are already running Google Ads.


The Google Display Network is the largest network of websites that you can use to show your ads. You have the following options for showing remarketing ads using Google Ads:

  • Standard display ads. By creating display campaigns you are able to target your remarketing lists. Your ads will be shown to previous website visitors that are visiting an eligible website on the Google Display Network.

  • Remarketing lists for search ads. Now, if you are already running search ads it is recommended to add your remarketing lists to them. It will allow you to change your bids, or show different messaging to previous site visitors.

  • Video remarketing. Youtube is owned by Google. So by using Google Ads you will have the option to set up video campaigns and target previous site visitors.


Facebook remarketing


The second option you have is to use Facebook remarketing.

Facebook Ads remarketing works similar to Google remarketing, except your ads will be shown on Facebook. You will need to add the Facebook pixel on your site and based on this data you can build audience lists.


Now, it depends on your business which of the platforms (Google or Facebook) you should use. Personally, I find that Facebook works best for low-cost products. Google is likely to be able to give you more volume. However, this is also depending on the audience that you are targeting.


You could use them both of course. Except you will need to monitor your conversions in a tool like Google Analytics. If you rely on the conversion data in each of platforms, you might be double counting your conversions.


Should you use remarketing for your business?


Now, the main question is: should you use remarketing for your business?


The answer is: it depends. 🙂


First of all, you will need a decent amount of website visitors. I would say you want to have a minimum of 1,000 visitors per month to make this work and set up advanced campaigns. Smaller websites will be able to set up remarketing campaigns as well, however it won’t be as advanced.


From my experience, remarketing works well for businesses that fit either of the boxes below:

  • Web shops that are selling a low-cost product (eg. socks) that are easy to sell online and already are getting a large amount of organic traffic.

  • Companies that can pay a high cost per acquisition, like SaaS companies.


The main pitfall for remarketing is that most businesses don’t calculate the incremental value of their remarketing campaigns. Remember, you are targeting previous site visitors. If you run other PPC ads, this means that you already paid for these visitors the first time.


So let’s say you are willing to pay $300 for a lead. It would be a mistake to pay $300 for a view-through conversion via remarketing.


Basically, there are 3 options:

  1. The visitor had seen your ad and decided to buy purely based on the ad.

  2. Visitor seen your ad multiple times, combined with visiting your site before he/she decides to buy.

  3. The visitor didn’t even see your ad and decided to buy regardless.


Your view-through conversions will be a mix of these 3 options.


To make remarketing work, you will need to get an understanding of the right mix. Only that way you will be able to set an average cost per view-through conversion.

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Display Advertising
Remarketing is a great way of advertising to people that are already familiar with your brand.

Large companies, as well as many small businesses, are spending a fair amount of their online advertising budget to get previous site visitors back to their site.

Often this leads to heaps of view-through conversions. Great, you might think, my remarketing campaigns are driving conversions for a significantly lower cost as my other PPC campaigns.

However, how many of these conversions would you get regardless of showing remarketing ads?


The Problem: View-through conversions don’t give a clear image of how well your campaigns are performing


The question you need to ask for display advertising is: who looks at your display banners and (eventually) takes action based on that.

Are your remarketing campaigns adding incremental value to your business, or are you just showing ads to people that would convert anyway.


The Solution: A/B test your ads vs a blank ad


The only way to understand the incremental value of your remarketing campaigns is by testing.

Split out each your audience lists into 2 different ones (A and B). Create 2 different ads for each of them: one with your own branding, the other with a blank ad.

Image to show how to test your remarketing campaigns.

Don’t rotate ad 1 and ad 2 for the same audience list! Make sure that the people in audience list A only see your branded ad, and people in audience list B only see the blank ad.

Variation: People might start noticing a blank ad eventually, so you can add multiple variations (eg. using a charity or a stock image) of this one and rotate them for audience list B.

Obviously, the blank ad isn’t attributing to any of the view-through conversions that you see coming in.

So by comparing the view-through conversions of audience list A with audience list B you’d be able to see the incremental value of your remarketing campaigns.

For example:

 

Size of list

View-throughs

Audience list A

(your branded ad)

5,000

112

Audience list B

(blank ad)

5,000

89

Incremental view-throughs

23


In the example above we split the audience 50/50 to show different ads to each half.

As a result, we have seen more view-throughs coming on the branded ad (as expected). In total there’s 201 view-through conversions of which 23 are incremental – we wouldn’t have got these if we didn’t advertise.


Therefore only 11.4% of the total view-through conversions


We can use the following formula to calculate the incremental value of our remarketing campaigns:

(Audience list A view-throughs – Audience list B view-throughs) / (total view-throughs) x 100


Extra: understand your conversion window


To do this test properly, it’s important to 
set a conversion window that is realistic to your business.

Too short means you miss out on valuable data, while if you set a conversion window that is too long it makes the numbers look better than they are.

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