The difference between Retargeting and Remarketing

One question we are asked quite regularly is about retargeting and remarketing. Some clients are confused by the terminology and incorrectly assume they are the same thing. While that is understandable as they both fall within the realm of marketing, they represent different concepts. As a top digital marketing agency, we wanted to discuss the difference between retargeting and remarketing along with explaining the importance of each in online marketing.

Understanding retargeting

A website does not convert all the people that land there. While it would be nice if that happened, the truth of the matter is that conversion rates on average are very low. Based on a report from Monetate, for retail businesses in the 2nd quarter of 2018, the global conversion rate was 2.86%.

That means on average you miss on converting 97 out of 100 visitors that arrive on your website.

Retargeting is the name for the process used to reach out to that 97% of visitors your site didn’t convert to get a percentage of them to visit again and actually convert. By using cookies your business can retarget them with ads that appear while they are browsing other pages to entice them to visit your site again.

When you consider the sheer number of strikeouts the average website has when it comes to converting, it makes sense why retargeting is an appealing idea.

What is remarketing?

Remarketing is similar to retargeting in that it involves trying to entice people into coming to your website and completing a conversion. The difference between the two has to do with the strategy and execution.

For remarketing, email is a common vehicle for execution. Information from users is collected over time, organized, and then used to send out targeted sales emails. One example would be emailing customers after they add an item to their wish list but leave the site without purchasing it. Another example would be sending an email to a customer that abandoned a shopping cart. For remarketing, you will be sending emails to both people who have converted in the past as well as those who haven’t, which is a difference compared to retargeting.

A great resource for learning more about Email Marketing is B2B Data Guy’s B2B Cold Email Crash Course.

One reason there is confusion in the industry is because some businesses use the term ‘remarketing’ when they should use ‘retargeting’. For example, Google talks about remarketing in Google Ads, however by standard definition what they are doing is retargeting.

At the end of the day what this means is a lot of people are saying remarketing but meaning retargeting.

How well does retargeting work?

There have been numerous studies over the years about retargeting and continually the numbers don’t lie; re-targeting is effective:

• In a 2015 survey of 1000 marketers, 91% who have used retargeting said it performs as well or better than search, email, or other display ads.
• The Incite Group found that 68% of marketing agencies and 49% of brands have a dedicated budget for retargeting.
• More and more industries are incorporating the strategy outside of retail according to a state of the industry release in 2016.
• Only 11% of consumers surveyed feel negative about retargeted ads while 30% have a positive or very positive reaction.

Remarketing is also very effective but much more difficult to measure from a survey aspect, often because of the confusion in terminology as well as some remarketing gets lumped into standard email marketing.

Traditionally speaking, email marketing has always been an effective tool because of the cost, reach, and open rates:

• According to a DMA Insight report in 2017 the average deliverability rate for email was 98.3%.
• In just the U.S. more than 85% of adults send or read email and 99% of those users check mail every day.

The bottom line

The bottom line is that the difference between retargeting and remarketing really isn’t very big and it is rather forgivable that people misuse them. At the end of the day, they are both effective methods to use existing customer data to attempt re-engagement and increases conversions. Our recommendation is to use a combination of both approaches rather than just one to effectively increase site re-visits and thus create more conversions and boost your bottom line.

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