What Is Retargeting?

Retargeting encompasses the tactics used to bring back visitors who didn’t convert after their initial visit. If a user leaves without taking the desired action, there’s a staggering 97% chance they won’t return on their own. Therefore, retargeting aims to entice them back to your site and, ideally, provide a personalized experience that encourages conversion.

Various channels can facilitate retargeting, including display banners, social media ads, and email marketing.

Common reasons for user non-conversion often include timing and pricing concerns—such as being unprepared to buy, researching options, or simply not having a payment method readily available. The longer the decision-making process drags on, the more challenging it becomes to persuade potential customers to make a purchase.

Why Is Retargeting Necessary?

The purchasing journey can be intricate and lengthy. Individuals typically start with passive research, gathering information about available options before transitioning into an active search to identify the best choice. This phase is often referred to as the “Messy Middle.”

Statistics reveal that the average conversion rate in e-commerce hovers between 1% and 2%. Even for those with a higher conversion rate of around 3%, approximately 97% of site visitors leave without completing a purchase. Many of these visits may have incurred costs, and even if the interaction didn’t lead to conversion, some level of brand recognition likely occurred.

Given that multiple visits are often necessary for conversion, it is more efficient to re-engage users who have previously visited rather than continually seeking out new traffic. Based on experience, retargeting campaigns typically yield the best conversion rates, rivaled only by brand campaigns. However, brand campaigns can also be viewed as a form of retargeting since they target users already familiar with your brand.

Distinguishing Remarketing from Retargeting

Remarketing and retargeting are two terms often used interchangeably in the marketing world, and while they share similarities, they do have distinct meanings. Both terms refer to strategies aimed at converting users who previously interacted with your online store but did not complete a purchase.

The primary goal of remarketing is to guide users back to your site and reintegrate them into the conversion funnel. In contrast, retargeting often involves a different strategy—one that offers users additional products or services. This could mean upselling to a more expensive subscription, reminding them of an expiring subscription, or suggesting complementary items to their previous purchases.

For a clearer understanding, consider this example:

Remarketing occurs when I browse Food Panda for dinner options but don’t place an order. Later, I visit a news website and see an ad from Food Panda reminding me that I still haven’t ordered anything. This prompts me to return and make a purchase. Conversely, retargeting happens when, two weeks after my last order, Food Panda emails me a discount coupon to encourage a repeat order.

In practice, the lines between these two concepts have blurred, and tools like Google Ads allow for both retargeting and remarketing. Using them interchangeably is common and acceptable, as I have done throughout this article.