Retargeting Prospecting balance
This month we explore the critical mistake most online businesses make with retargeting.
Often our initial conversations with clients running ecommerce elements to their businesses end with them looking for methods to improve their site conversion rates. The answer to this is of course with retargeting.
However, there is a crucial element that we coach businesses to help them understand which is that retargeting can only grow at a rate which is in line with new customers coming to their sites. The same applies to you.
There’s no question that for most businesses, Paid Search and Retargeting are the most efficient (from a ROAS or ROI perspective) advertising methods to be employed. That’s because search and retargeting are the best methods for converting prospective customers with the highest levels of intent. That is, they either know what they’re looking for (or often know to look for your business) or have been to the depths of your website and not purchased. Just a little push (read advertising spend) is required to get that purchase.
The problem is, it relies on people knowing you exist, what you offer and coming to your site to be influenced by your amazing proposition. What this means is that your retargeting efforts are limited to those people who make it to your business’ website and sufficiently through the purchase journey.
If revenue growth from sales is your primary business objective and your belief is that improving site conversion rate with achieve this for you, you’re not wrong, but you will soon find that this growth is not good enough. This is because there is not enough new prospective customers coming to your website to increase the number of people that make it through your site to the point where retargeting is most effective for you.
We have encountered many brands that have focussed their efforts on retargeting because they have seen the most efficiency there and then over time seen this drop off and assumed that either they were doing something wrong or that there was a creative issue or worse that their product/service wasn’t as appealing as they once thought. In reality, they have simply depleted their retargeting pools having not paid attention to keeping them topped up.
The solution is to create a balance between prospecting for new customers and getting them on to your website and retargeting them once they hit a certain point. This will not be the most efficient short term approach, however it will allow you to stay efficient for an extremely long time plus all the other benefits that come with showing off your brand to new people.
Getting the balance right and creating an effective prospecting effort is the key to maintaining long term efficient growth.