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How Retargeting Works: Everything you need to know about the most popular innovation in online marketing.

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There has been a revolution in the world of online advertising. No longer are advertisers guessing at what viewers might be interested in based on age, gender, or other generic demographics. They now have targeted research of exactly which websites should be promoted to which people, and they are putting that information to good use.

The Basics

This breakthrough is called “retargeting”, a system which reminds Internet users of previously visited websites and urges them to return. Through retargeting, companies can identify people that have expressed some interest in their product and exclusively advertise to them. This creates a higher click through rate and, with persistence, results in a larger conversion rate. Viewers also benefit from seeing their screens filled with more relevant information as retargeting allocates limited advertising space more effectively.

New Innovations

Retargeting as an online advertising strategy has grown exponentially in recent years. Adroll, a San Francisco based company that specializes in retargeting, has increased its revenue by over 400% in the last four years. Other agencies are innovating even more ways to retarget. The New York City based media firm Collective has developed a software product that retargets television viewers online using data from cable TV set-up boxes. RadiumOne, a digital agency also based in San Francisco, now uses twitter hashtags in their retargeting schemes. Along with hashtag retargeting, there also exists email retargeting, contextual retargeting, engagement retargeting, and search retargeting, all of which are variations on the general concept of site retargeting (described above).

Retargeting Gone Wrong

However, there is a dark side to retargeting that many Internet users can attest to. Many think it is “creepy” or “invasive” for companies to track their personal Internet usage and repurpose the information for advertising. These people sometimes choose to disable the cookies feature in their web browser and enjoy the Internet more privately. Others don’t mind the covert information gathering but get annoyed when they keep seeing the same advertisement for months after visiting a website. Subtlety is the answer to both these problems. Advertisers should be careful not to bombard viewers by strategically determining when to start retargeting someone, how often they should be retargeted and when to let them go. After all, timing is everything.

Surfing the web has become an increasingly individualized experience. Thanks to retargeting it is now much easier to connect the right ad to the right audience.  When handled appropriately, this marketing revolution benefits everyone involved.


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