Ad Retargeting, Part 1: Budgeting & Investment
This is the first of three posts about how to get more out of your ad retargeting programs.
Marketers are starting to see greater value in ad retargeting. According to a recent AdRoll survey, over 90% of marketers say that retargeted ads are as good or better than search ads, which have long been thought of as the ‘gold standard’ in reaching the consumer. As such, marketers are willing to spend more of their budget focused on retargeting initiatives. According to the AdRoll survey mentioned above, 71% of marketers are spending between 10-50% of their digital marketing efforts on retargeting ads. But just because they are better than search ads, does that mean marketers are really receiving a return on their investment?
With a total spend of nearly $6 billion in the U.S. for 2015 on retargeting, click through rates remain flat, around .06%, for all ad formats and placements. Despite considerable investment from brands, their current retargeting efforts are not driving conversions. Even an incremental improvement in click through rates would translate into significant ROI, but a majority of the time ad tech partners are limited by their lack of insight into the types of customers that should be targeted in order to improve outcomes. For ad tech partners to most effectively reach ideal customers, marketers must be able to provide detailed insight about the individuals that make up the target segments fed into the ad tech solution.
By using BlueConic to capture first party data and build out customer profiles for each person who visits a particular website or uses a mobile app, our customers are able to capture all of the data that is necessary to decipher the individuals’ needs and intent. Rich segments based on individuals’ behavior, interests and other traits provide ad tech partners with the basis of comprehensive and distinct divisions within prospects. Not only does this enable more effective marketing throughout the entire prospective customer-base, it also creates an opportunity to hone in on key segments, such as those with a high customer lifetime value or those who recently abandoned a key task on the site. By recognizing these significant subsets and getting a timely, relevant message based on the data you’ve collected in front of them will result in more efficient use of retargeting budget, leading to greater ROI.
For example, a customer in the insurance space has identified three distinct tiers of customer value that it uses to segment individual prospects and customers in real time. The marketing team sends those customer value guidelines to their ad partner, DoubleClick, for more efficient targeting and retargeting efforts.
Accurate retargeting of key individuals across their life cycles will allow brands to more appropriately engage with their consumers, leading to higher click through rates and more efficient use of ad spend. Identifying important segments, and retargeting accordingly, will culminate in greater conversion rates and increased ROI of the acquired customers.