Marketers are always looking to get the most out of online advertising. From text ads to display ads, every channel provides a unique opportunity to engage potential customers. Over the past few years, the focus has shifted from sheer volume based passive advertising to contextual advertising that leverages customer’s online behavior. Marketers now have access to technology that allows them to fine-tune their ads and target users who have shown interest in their brand.

What is Retargeting?

As the name suggests, retargeting is a technique that allows marketers to serve online ads that are based on user’s past activity. The term retargeting is derived from the simple concept of targeting of online users after their first engagement with your brand. Retargeting comes in two distinct flavors – off-site retargeting and on-site retargeting. Off-site retargeting includes targeting users based on their search history in search engines, past content consumption, social media interaction, and interests. It is important to remember that these users have not visited your website yet, so there are no browser cookies set by your website. While these users are a better audience than random passive ad audience, they still have little to no familiarity with your brand so trust is still relatively low. On-site retargeting is aimed at targeting and engaging users who have already visited your website. As a user visits your website, a cookie is set on their computer and now you can target them elsewhere on the web. Retargeting is done through third-party networks such as DoubleClick Display Network with millions of websites, making retargeting appealing and highly effective.

What About Privacy Concerns?

While retargeting improves engagement and delivers significant gain in terms of CTR and conversion, it also has negative aspects. Most people are annoyed and develop a strong feeling of mistrust when they noticed that certain ads are following them on the web. This negative perception increases significantly as the frequency of ads goes up.

Final Verdict

Retargeting is an important tool for marketers. However, there needs to be a balance between positive brand exposure and frequency and context of ads served. It is essential not to get carried away by focusing on ROI measurement in terms of click-through rates. It is a classic case of “Too much of a good thing can make it bad.” In addition, digital marketers tend to get consumed by data. While data can help support their decisions and return on investment, they need to be aware of the big picture. Building brand through positive customer engagement is much more important than short-term spikes in click-through rates.