Website Design Lake Park

What is Retargeting and How Does It Work?

Retargeting is a powerful digital marketing strategy, but to use it properly you must first understand the nature of landing page conversion rates, and warm traffic vs cold traffic. When you create a landing page designed to engage with the traffic that you’re sending to it, you hope that it will convert most visitors the first time they land on it. However, this usually isn’t the case.

In fact, some sources, such as Mail Chimp, claim that on average 97% of people who visit business websites leave without purchasing anything, and never return. This is where retargeting comes in.

What is Retargeting?

Retargeting is all about second chances. Since it may take multiple exposures to your products and/or services for people to make the decision to do business with you, you need to maximize the number of times they are exposed to your brand. This is because the more times a person comes into contact with your brand, the more chances you have to capture their interest, and get them to spend money on you. It’s simply a statistical truth.

Using retargeting campaigns you’re able to expose potential customers and clients to your ads repeatedly instead of just once. This can have a major impact on your overall sales, and your total revenue generation. The catch here is that in order for a retargeting campaign to work, a person must first visit your website at least once. This can be through clicking on an ad, or even through finding your site in the search engine results. Regardless of how it happens, people must land on your site one way or another, and your sales funnel and marketing fundamentals must be sound in order for a retargeting campaign to be an option.

Using Pixels to Track Internet Users

The way retargeting works is simple: When someone lands on your website they are exposed to a retargeting pixel that gives them an anonymous browser cookie. This cookie then tracks their activity and makes sure that the ads they encounter are your ads. While this may sound sketchy, it is 100% legal, and the retargeting pixels themselves come from legit companies like Google, Facebook, and other ad networks.

Using pixels to retarget ads is one of the most popular methods of audience collection, and is a big part of many company’s online marketing campaigns. If you’re not using pixel based retargeting then you are likely leaving a lot of money on the table that could otherwise be used to fuel the growth of your business.

Warm Traffic vs Cold Traffic

One of the core concepts of retargeting campaigns is leveraging the advantages of warm traffic. Done correctly, this can drastically increase your landing page’s conversions, and even create repeat business. Before we go over what warm traffic is, and how it can benefit you, let’s take a look at cold traffic.

Cold Traffic

Cold traffic is traffic that has never been exposed to your brand before, and may not have an interest in what you have to offer. Examples of marketing methods that target cold traffic include:

    • cold emails
    • online ads
    • radio ads
    • television ads
    • flyers
    • networking
    • direct mail campaigns

As you can probably guess, conversions using cold traffic are very low in most cases. This is why most marketing campaigns that target cold traffic try and connect with as many people as possible in a sort of quantity over quality strategy.

Since conversions are going to be low, targeting huge numbers of people is the only way to make sure that enough revenue is generated to make these campaigns worth the time and resources put into them.

Warm Traffic

Warm traffic is traffic that has either already been exposed to your brand in some way, or traffic that is actively searching for what your business offers. For example, if someone who lands on your site knew about your brand previously from a radio ad they heard, or because they follow you on social media, that would be considered warm traffic.

Another example of warm traffic would be someone who’s landed on your site, had your tracking cookie added to their browser via your pixel, and then ends up coming back to your site via an ad later on. This is actually one of the best methods of producing warm traffic that’s easy to convert into customers and clients.

The Cost of Retargeting vs Cold Traffic

When comparing cold traffic vs warm traffic one thing that always comes up is CPA which stands for “cost-per-acquisition.” This term is used to describe the amount of money it takes to acquire each customer or client that does business with you. For example, if your marketing campaign costs a total of $10,000 and brings in 1,000 customers, then your CPA would be $10.

Getting your CPA as low as possible is important for increasing your profit margins. This is why techniques that target warm traffic, such as retargeting and email marketing, are so popular. It’s much easier to convert warm traffic that it is to convert cold traffic so it should be a priority when possible.

As for the cost of retargeting, it essentially doesn’t cost anything upfront. However, depending how how effective your retargeting segmentation is, you may have a higher or lower ROI and could even take a loss in some cases if you are retargeting people who have no interest in what your brand has to offer.

That said, the amount of revenue that you can generate with pixel retargeting can be very significant. Some sources even claim that retargeting can increase your revenue generated through ads by 340%. That’s a lot of extra money earned for doing something so simple.

Turning Cold Traffic into Warm Traffic

As mentioned earlier, a retargeting campaign is only effective if you can first get people onto your website. The good news is that by implementing smart marketing strategies you can easily turn cold traffic into warm traffic. Let’s take a look at some of the ways that you can do this so that your retargeting campaigns are as effective as possible.

Soft-Sell Landing Pages

Since most people aren’t going to make a purchase or hire you on their first visit to your website, you can use a soft-sell landing page to make them more receptive to your marketing message when they are retargeted by your ads later. The reason this works is that since they’re less aggressive than a hard-sell landing page, a soft-sell page will give visitors a positive experience with your brand.

A soft-sell landing page can be a blog post, listicle, checklist, or even a freebie of some sort. The point is that the page doesn’t pressure the visitor, and instead engages with them in a helpful way while exposing them to your brand. This will leave a good impression on them so that they’ll be more likely to click your ads when your retargeting campaign does its thing.


While search engine traffic technically isn’t warm traffic in most cases, it can still be very easy to convert. Even so, you can increase your revenue by using retargeting to bring back the people who leave without making a purchase.

In order to do this you’ll have to be a bit more creative since SEO traffic tends to already be in a buying mindset. Ads featuring special offers they haven’t seen before, limited time discounts, and other surprises that will convince them to return as they’re shopping around are a good way to keep them from falling into the hands of your competitors.

Cold Email

There are a lot of options when it comes to the CTA (call-to-action) of a cold email, however, if you plan to use retargeting you need to find a way to get them to your website. The main thing to remember here is to make sure that you’re promising value.

If you give your recipients a good reason to click through to your website, they’ll do so and then your pixel can give their browser your tracking cookie. Don’t forget that cold email can be very effective when combined with soft-sell landing pages.

Direct Mail

Direct mail campaigns can also benefit from getting people to your website where your pixel can do it’s job. As with cold email, just give your recipients a good reason to visit your site, and they will.

However, one advantage that you can use with direct mail is QR codes. By using these scannable codes you can make it easy for people to get to your site with their mobile device, and retarget them much easier.

Other ways that you can use QR codes include:

    • In TV commercials
    • On flyers
    • On invoices
    • On receipts
    • On product packaging
    • On thank you notes packaged with shipped products

In any case, using a QR code makes it easy for people to visit your site so that you can begin retargeting. Remember, it doesn’t matter how you get them to your website, only that you get them there somehow.

Targeting Your Demographic

As the term “retargeting” implies, there is another form of targeting that takes place first, and that’s demographics targeting. If you want your retargeting efforts to be successful then you must first make sure that you’re targeting the right demographic.

Think about it this way, if you spend money on an ad campaign that isn’t targeting your demographic as well as it should, then you will have a much harder time turning cold traffic into warm traffic. This being the case, your retargeted ads will be much less effective since many of those people won’t have much interest in your products and/or services.

Generally speaking, the higher your initial conversion rates are, the higher your retargeting conversions will be. This is because your initial conversion rates are a good indicator of the quality of the traffic you’re bringing to your website. Higher quality traffic is easier to convert the first time, and any subsequent times that it lands on your website.

Segmenting Your Audience

The last thing that you need to remember when it comes to retargeting is the fact that you shouldn’t treat all of your traffic the same. By segmenting your traffic into three groups you can run better retargeting campaigns that produce more revenue. Let’s go over each of these audience groups, and how you should treat them for best results.

Segmenting by Time

The timing of your retargeted ads can make a big impact on how well they convert. Show them too soon or too often and you can give people a negative impression of your brand. Show them too late or not often enough and you could lose potential customers and clients to your competitors.

Segmenting your audience by time is all about understanding your demographic, and how they they want to interact with your brand. Once you know this, you can segment by time based on the following factors:

    • How often they see your retargeted ads
    • How soon after visiting your site they start seeing them
    • When your retargeting campaign stops showing them your ads

Segmenting by Behavior

Segmenting your traffic by behavior tends to come down to how much time visitors spend on your site. Visitors that show some level of interest tend to visit multiple pages, and spend time browsing your content. Visitors that have no interest in your brand will click away almost immediately.

The key here is to try and filter out the “not interested” group as much as possible, and focus only on those who actually show interest in your brand. The reason for this is that wasting money on ads targeted to those who will probably never do business with you will just waste money and lower your ROI.

Segmenting by Existing Customers

It’s a well known fact that marketing to people who have already done business with you once is more profitable than trying to find new customers. This applies to retargeting as well.

Retargeting campaigns are often times most effective when used on previous customers during special situations such as product launches, special offers, and pricing updates. Of course, in order to segment by existing customers you must first have existing customers. This means that this strategy is only effective once you’ve gotten some momentum going.

Retargeting is Easy and Profitable

Regardless of what kind of business you run or what industry you’re in, there is almost no reason not to use retargeting if you’re running ads online. The sheer profit potential that comes with retargeting is almost always worth the simple task of adding a retargeting pixel to your website.

Just remember that retargeting is very much a secondary marketing strategy. You must first be able to get traffic to your website before you can make use of retargeting, and the more focused that traffic is, the better your results with retargeting will be.

In any case, the sooner you start using pixel retargeting in your online marketing efforts, the sooner you’ll be able to see a significant increase in your ad revenue.



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