Last updated on November 5, 2016
Have you ever wondered how the hell Zappos can show you ads about the shoes you looked at a few days ago? Or how you can continually see my face all over the internet after you visit Monthly1k.com?
Retargeting can be one of the best ways to attract the right customers and capture additional revenue. Even if you haven’t done much paid advertising, it’s easy to get started.
|(For those that already know what retargeting is and how to set up a campaign, skip to the bottom where I share some advanced strategies)|
For everyone else, buckle up to learn more about retargeting, how to get started, and exactly how to spend your first $100 successfully on retargeting.
Retargeting assumes that when someone visits a product or site that they have some level of interest in it, and that if they are shown that same product or site again through an ad and they click that ad they will likely buy the product or revisit the site.
TV ad frequency has been playing on this principle for years, and it’s the real reason why it’s so effective. When you see the same ad on TV 1,000 times, they are banking on the fact that you’ll be so familiar with the company or product that you will naturally like and trust it more.
For most sites, more than 90% of visitors visit and leave without converting or buying.
So how does it work?
When someone visits your website, you add a cookie to that person’s browser and as they open new sites and pages advertising exchanges across bid on showing more advertising to that specific person.
The key to retargeting is it is MUCH easier to advertise and sell to people who already like you vs. brand new customers.
Which are you more likely to buy?
A pair of shoes you searched for, read about, and then see again online as an ad.
A pair of shoes you have never seen before that appears as an ad.
The key difference between retargeting and regular advertising is you already KNOW that the customer is interested at some level.
We’ve had the exact same Monthly1k ads for over a year now. There are 3 types of ads I’d recommend creating:
1: Direct Purchase. Direct image back to your product purchase page. Ours goes to Monthly1k
2: Free. Free product related to your main product. For us, we promoted a free validation cheat sheet.
3: Content advertising. Promote an ad to a helpful article that also promotes your service. Here’s the article about how AppSumo was started for $50.
All have worked equally well. I’d encourage you to start off with #1, direct purchase since it’s easier to try to get people to buy vs distracting yourself with creating free things or writing content. (Just be sure to have set up ways to capture email addresses.) Also, my face and name is plastered all over these advertisements because we found that a face and name converted better than just a product.
1- Facebook newsfeed:
2- Facebook sidebar:
3- Google Image Ads:
Seen on YouTube and 3rd party websites
4- Google text ads:
5- Twitter feed:
At AppSumo, we’ve seen the most profitable ads on:
1- Facebook sidebar ads
2- Facebook newsfeed ads
3- Google Image advertising
We have not seen profitable ads within Twitter, so I won’t cover how to set them up. (Also if you’re wondering, we don’t do text ads—all of our ads contain images.)
Before showing you exactly how to get started, let’s look at the basics of how I’ve set up my retargeting campaigns:
Who I use and why:
I use Perfect Audience (includes $60/credit for a trial) because it’s harder to do retargeting inside Facebook via Google’s retargeting (they call it remarketing). Perfect Audience can do both FB and Google. It uses the same pixel so that you only have to set it up 1x.
Advertising tip: Other retargeting companies are the same. If you are spending over $1,000 a month, go to your advertising company and mention you’re considering using their competitor: AdRoll or Retargeter (both good companies) and the company will likely reduce their margin for you. : )
Also Facebook has it’s own new Website Custom Audiences feature, but I want you to start today—and the easiest way to do that is through Perfect Audience.
A good benchmark for retargeting ROI: 200%
That means for every $1 you are spending you are making $2. Why 200%? No particular reason, but it feels good to double your money. Too high means you might be missing out on volume. Too low means you aren’t making enough money.
Here are the latest AppSumo numbers:
We spent $4,168.19 and have made $9,365.00. That’s a 224% ROi. A bit above target! Woot!
You should always aim for 200% ROI. This may seem high, but if you follow the guide below you’ll have the knowledge to reach it. You are wasting your time and money if you can’t reach 200% ROI.
I use a retargeting campaign when:
1- People visit AppSumo or Monthly1k, but don’t purchase a product
2- We are doing a time limited product launch.
3- Growing an email list and getting a customer’s email address
1. Name your list FBx (so you can separate out FBX vs newsfeed ads) – Ad group
2. Leave blank so you can always have the people in your retargeting list
3. Add a * so it’ll show on every page on your domain e.g. http://okdork.com*. (Or if you’re targeting a specific page you can add * after the url to act as a wildcard. This way tracking will work on a url wether is exactly okdork.com/about or has trailing okdork.com/about/?src=buffer.) You can exclude people who’ve visited a confirmation page or buy page. I’ll show you how to do just that later.
Caution: If you WANT to exclude people who’ve bought or only retarget people who’ve visited a certain page. Go back to:
This is how you can Exclude people who’ve visited a certain page.
These are the lists I want to include and the group I want to exclude.
Targeting Window: This means showing your ads to people on your list who’ve visited your site in past X amount of days. Personally I recommend 30 since if people haven’t taken action within that time period I don’t think they will.
Geo targeting & Dayparting: Please ignore for your first campaigns. You can find more about these in the advanced strategies PDF at the end if you’re interested.
An ad in a Facebook sidebar will get shown way more often versus a newsfeed ad. Remember, repetition and frequency are your best friends in retargeting.
Title: How Noah Kagan did it (How your product or company made or will make a person successful)
Image: Me (We found photos of people convert higher than other images)
Body: I worked at Facebook, Mint and started AppSumo. Want to start your own business? Let’s go. (Bold claim with call to action)
Sidebar FB ads have been our best ads because, unlike the newsfeed ads, they are shown more often. In the advertising world that’s called frequency. And with retargeting it generally takes a decent number of impressions to finally get someone to click and take an action.
Even though you can do Google (web) or Twitter retargeting, they have converted less over the past year for me and this article’s goal is to set you up as easily as possible.
Should you exclude people who have already bought my product or service?
There are two camps of psychology about advertising to existing customers:
1. Reinforcement: Some people get buyer’s remorse. By continuing to show ads about your company or your product, you can reinforce a the decision the customer made.
2. Exclude: After the customer has bought, save your budget just for new customers who have not bought yet.
I am a fan of camp #1. However, I only show ads to people who have visited the site in the past 30 days. As you develop additional campaigns, Aaron Zakowki recommends creating different lists for customers so that can you can create specific and different messaging after they purchase.
Retargeting list started, Check.
Ads created, Check
Now it’s time to get them live.
Conversion Name: Name it
Conversion Type: Add the url of the “Thank You” or other confirmation page a customer visits once they’ve purchased
Revenue Value: Self-explanatory 🙂
Conversion Counting: Count every conversion
Since your retargeting pixel is on every page and you’ve listed above which page is the conversion you DO NOT need to add another pixel or do more work.
Since you are doing 30 days, commit $75 / 4 = $18.75 as your weekly budget for the FB Sidebar ad.
Campaign Schedule: Run it continuously starting today
Bidding: To start, let it be optimized. What this means is they’ll figure out what you need to pay per click to start actually getting clicks. In the advanced section below I’ll share some strategies about how you can be more effective with this. In the beginning, set it and forget it.
Note: You will need to create 2 campaigns. 1 for your Facebook retargeting (sidebar) and 1 for your Facebook newsfeed.
Put in your credit card and you are ready.
I like reviewing campaigns on a trailing 30 day basis. Because of holidays or fluctuations of traffic, 30 days provides a pretty good amount of data to make changes to your campaign. 7 days is too short.
Tip: After 7 days, put the performance percentage in your campaign name. That’ll help you have a baseline for the next time you revisit your campaign performance. I also auto-schedule in my calendar a weekly review of my ads so I don’t have to actively think about them as much.
Here’s exactly how to optimize a retargeting campaign:
This helps me see if I’m completely sucking or on track with my 200%+ target. Whoo, I am.
You can do this by clicking on the little graph icon (1). Then compare your cost (2) and profit (3). For this campaign we are at 538% ROI which is awesome!
Example: Let’s say my ROI Profit / Spent is 150%.
This campaign is not meeting my target goals and #s:
1. So I click edit on the campaign
2. I take what the current CPM in the top left is:
3. Then I figure out what that eCPM (effective cost per thousand impressions) needs to be at to get to 200% ROI.
$3000 revenue | $2000 cost | $.52 eCPM
Need cost to be at $1,500 for me to have my target ROI.
2000-1500 / 1500 = 33% decrease in cost
And 33% less of $.52 (*.66) = $.34
So I click edit campaign and change to manual bidding to $.34
Then my cost should get me the ROI I want. Hoozah!
Warning: People who are coming from retargeting DON’T buy right away. Otherwise they would have bought or taken action when they were on your site the first time. Commit at least 30 days to see your results. Some people get impatient and think retargeting isn’t effective. As well, you are only doing $100 so you aren’t losing a ton of money if it all goes badly.
Go to PerfectAudience now and get live then come back and read. If you have a blog and want more subscribers, you can do retargeting. If you sell products, you know this will help. Most sites only get 2% conversion rate so you had 98% of your people leave to never be seen again. Don’t let that happen. Noah cares 🙂
At this point if you’ve never setup retargeting, do it today. It should be one of the best channels you have for increasing your business.