Retargeting
Retargeting is a digital advertising strategy that shows ads to people who have previously visited your website or interacted with your brand, bringing them back to complete a purchase they did not finish.
Understanding Retargeting
Retargeting works because most visitors do not convert on their first visit. The typical e-commerce conversion rate is 2-3%, meaning 97-98% of visitors leave without buying. Retargeting keeps your products in front of these visitors as they browse other websites and social media, maintaining awareness and nudging them back to complete the purchase.
Pixel-based retargeting places a tracking pixel on your website that identifies visitors and enables you to show them ads on other platforms. When a visitor views a product but does not buy, you can show them an ad featuring that exact product on Facebook, Instagram, Google Display Network, or other ad platforms.
List-based retargeting targets known customers from your email list. You upload your customer email list to an ad platform, which matches the emails to user accounts and shows your ads to those specific people. This is effective for re-engaging lapsed customers or promoting new products to existing buyers.
Retargeting ad creative performs significantly better when it includes social proof. Showing the product the visitor viewed alongside its star rating, review count, and a short review snippet is more compelling than showing the product alone. The review data addresses whatever hesitation caused them to leave without buying in the first place.
Why It Matters for E-Commerce
Retargeting converts warm traffic that has already shown interest in your products. The cost per acquisition for retargeted visitors is typically 50-70% lower than cold traffic because you are reaching people who already know your brand and products.
Related Terms
Customer Acquisition Cost (CAC) is the total cost of acquiring a new customer, calculated by dividing all sales and marketing expenses by the number of new customers gained during a specific period.
Return on Ad Spend (ROAS) is a marketing efficiency metric that measures the revenue generated for every dollar spent on advertising. It is calculated by dividing total revenue attributed to ads by total ad spend.
First-party data is information collected directly by a business from its own customers and website visitors through interactions on its owned channels. This includes purchase history, browsing behavior, email engagement, account information, and on-site activity.
Click-through rate (CTR) is the percentage of people who click on a specific link, button, or call-to-action out of the total number who view it. It is calculated by dividing the number of clicks by the number of impressions, then multiplying by 100.
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GlossaryRemarketing
Remarketing is the practice of showing targeted ads to people who have previously visited your website or interacted with your brand but did not complete a desired action, such as making a purchase.
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