The key differences of remarketing ads to be aware of
March 7, 2022
Any marketing-savvy person is probably familiar with the concept of remarketing.
Remarketing is a great way to target audiences who have previously interacted with your ad, website, etc. but not yet made any purchases.
However, it does take time and more effort to build a remarketing campaign.
If your audience is too small, or your ads are too aggressive, you could quickly burn it all out.
Now, you could try and run other types of conversion ads like new products, sales, etc.
However, we found that remarketing ads outperformed those types of conversion ads in purchases, CTR(click through rate), and cost.
Let’s dive in and take a look at 3 reasons why you should consider using remarketing ads!
Remarketing ads perform 38% better than all other conversion-focused ads
Let’s start by comparing the performance of remarketing ads to all other types of ads.
Like we mentioned, remarketing audiences have interacted with your brand, so they have advanced further through your marketing funnel.
They’re also aware of your brand and perhaps even know details and information about your offer.
Since they also might have clicked on your ad or landed on your webshop at some point, they are very likely to have some type of interest in what you have to offer.
These people are further in their buying process and might be evaluating different options.
Keep in mind however, that there are varying levels of retargeting.
People that have visited your website more times in the last 7 days might be treated differently than someone only visiting a couple times in the last 7 days.
Also what pages they spend the most time on gives you good insight on what their intent and interests are.
Knowing this information and using it is why remarketing ads perform much better than other types of conversion ads!
This is also a big reason why many brands structure their campaigns with top-funnel ads + middle funnel ads that bring traffic to the website, combined with remarketing ads focused on conversions.
Remarketing ads in general have better performance than other conversion focused ads.
Even though conversions and purchases are important metrics to consider, it’s also worth looking at click through rate(CTR).
On average, remarketing ads have a 4% lower CTR than all other conversion ads
When we talk about performance, we’re talking about the conversions and purchases that the ad leads to.
However, it's interesting to also look at the difference in click through rate (CTR).
We found that remarketing ads have a 4% lower CTR than other conversion ads!
It’s interesting because you might think that higher performance would also mean a higher CTR, but the data shows that this isn’t the case.
Remarketing audiences are just as likely to click on an ad as any other audience!
Their behavior changes only once they land on your website, where they are much more willing to make a purchase.
Since you are getting more quality visitors, the CTR for your remarketing ads should be similar to your other ads.
However, you should also expect a higher likelihood of conversions from those clicks(since the audience is already familiar with your brand and interested in your offer).
It's also worth noting that this could be different from message to message - which we'll discuss this further in another blog.
Also, the risk of targeting a smaller audience with a high frequency of ad impressions is that you risk annoying your audience and negatively affecting your brand reputation.
That’s why it's important to find a balance between frequency and reach to make sure that your ads are effective without being overwhelming.
So, keep in mind that your remarketing ads will likely have around the same CTR than your other conversion ads.
On average remarketing ads has a 20% higher CPM than all other conversion ads
On average, remarketing ads have a cost per thousand impressions (CPM) that is 20% higher than other conversion ads.
One issue that can contribute to high CPMs is advertising to a too-small audience.
This is common when using remarketing, as you are targeting a specific group of people, and if other advertisers are targeting the same group, your CPM rates can increase significantly.
Another reason is because these customers are further along in their buying journey and may have also visited competitors' websites, or the Meta/Facebook algorithm has determined that they are more likely to make a purchase.
This makes them attractive to both you and other advertisers, which increases the demand to reach these customers with advertising.
Even though it is more expensive to target these customers, it is worth noting that they are also 38% more likely to convert.
It may be helpful to consider the average order value (AOV) to determine which customers are the most valuable to your brand and weigh the cost-benefit of targeting them.
So keep in mind that on average, remarketing ads have a higher CPM than other conversion ads.
Remarketing is a great way to show ads to people who have visited your website before.
These people might be more likely to buy from you because they already looked at your products and learned about your offer.
However, before you start running remarketing campaigns, make sure you keep these two things in mind:
People might be just as likely to click on an ad as other people, but they are more likely to actually buy something from your website.
Other companies might also want to show ads to these people, so you might have to pay more to show your ads to them.
Above all, use these two pieces of knowledge on your own campaigns and see what kind of results you come up with for your brand and industry!
More to read
- Why you should use a sales message in remarketing content
- How much text to include in remarketing content for best performance?
- Should you show the price in remarketing content?
- Is it a good idea to use models in remarketing content?
- Including a logo in your remarketing content - Yes or No?
The dataset from this article is based on 215M impressions and 6K pieces of individual content on Meta (Facebook) platforms. It takes into account data from all countries and industries, with the campaign objective of Conversions. The period is from 1. September 2021 - 16. September 2022.
Numbers are looking at correlation only, not causation. Remember to check your own data: numbers for different brands, industries, and contexts will vary.
If you were intrigued about a specific insight, you can go in-depth into the various dimensions and how data can be segmented in Confect, here.