Retargeting, once the cornerstone strategy for marketers to convert potential customers who left a brand’s website, is witnessing a significant shift. With only 4% of site visitors making a purchase, retargeting seemed like the perfect solution to capture the remaining 96%. However, the strategy is now facing stagnation, urging marketers to revisit and reformulate their approaches.
Understanding Retargeting
Retargeting ads differ from conventional banner ads by targeting individuals who have previously interacted with a brand. Platforms like Meta and Google dominate this space, utilizing extensive user data to serve ads based on browsing history and past purchases. When a user clicks on a retargeting ad, they typically land on a static webpage designed to convert them. While effective for some sectors like e-commerce, this approach struggles with categories requiring personalized content, such as insurance.
Dynamic Landing Pages
As more Indians engage with social media, the need for dynamic, personalized landing pages becomes evident. Static ads work well for straightforward products but falter in complex decision-making processes like insurance. Customers in this sector need tailored information based on personal data like age or health, which static pages fail to provide. Moreover, privacy constraints on platforms like Meta and Google limit the use of personal information necessary for these dynamic pages.
Diminishing Returns
Static retargeting ads can become monotonous, leading to diminishing returns. Even with dynamic ads, the challenge persists: can a single product be advertised in numerous unique ways? This lack of creativity results in stagnant customer experiences. Incorporating technologies like agentic AI may help diversify ad presentations and combat this stagnation.
Frequency Caps
Overexposure to ads can lead to ad fatigue, where consumers become blind to repeated messaging. Marketers use frequency caps to manage ad exposure, but implementation can be challenging. Fragmented marketing efforts across different teams and platforms exacerbate this issue, making it difficult to track and control overall ad exposure.
Incrementality
Evaluating retargeting requires an understanding of incremental cost—the additional expense for results that wouldn’t occur otherwise. Insights from experiments, like those conducted by Ixigo, reveal that retargeting can sometimes be more costly than acquiring new users. Marketers often overlook these hidden costs, focusing instead on surface performance metrics.
Vague Intent
For B2B markets, retargeting becomes even more challenging due to the absence of clear buyer intent signals. Without these signals, retargeting efforts become less targeted and more akin to guesswork.
Closing the Loop
One persistent issue is customers receiving ads for products they’ve already purchased. This happens when exclusion lists aren’t properly managed, leading to wasted ad spend and potential brand fatigue.
A Tech Challenge
Marketing professionals face a gap in retargeting infrastructure that lacks a consolidated system for managing customer data and campaign outcomes. A more intelligent, automated system could enhance targeting precision and campaign effectiveness.
Ad Fraud
Retargeting is vulnerable to ad fraud, with bots mimicking human behavior to exploit advertising budgets. Building strong in-house measurement frameworks can help mitigate these risks.
Exploring Solutions
Marketers can explore solutions like sequential storytelling and creative experimentation to sustain engagement and expand reach. Using signal-based sequencing, brands like Kotak Mahindra Bank have developed tailored campaign messages that significantly boost conversion rates.
A MadTech Approach
With the reach of CRM channels declining, marketers are turning to innovative strategies like retargeting followers of micro-influencers. These influencers have higher engagement rates, offering a cost-effective alternative to traditional retargeting methods.
Dynamic Creative Optimisation
PolicyBazaar is testing agentic AI for personalized marketing, aiming to improve creative variety and operational efficiencies. Understanding customer behavior and tailoring strategies accordingly can enhance retargeting effectiveness and ROI.
Note: This article is inspired by content from https://brandequity.economictimes.indiatimes.com/news/digital/retargeting-needs-a-creative-reboot/121717351. It has been rephrased for originality. Images are credited to the original source.