Business Software & Marketing

Retargeting

Also known as: remarketing, behavioral retargeting, site retargeting

Retargeting (also called remarketing) is an advertising strategy that shows targeted ads to users who have previously visited your website, app, or viewed specific content.

When a visitor lands on your site, a tracking pixel places a cookie on their browser. Ad platforms (Google, Meta, LinkedIn) then show your ads to those cookied users across other websites and social media they visit later. Retargeting is effective because it reaches audiences who have already demonstrated interest in your product -- they know who you are, making conversion more likely than with cold audiences.

Retargeting, explained at three levels

At home

Retargeting is why you see ads for shoes on Instagram after you browsed a shoe website but didn't buy. The shoe website placed a small tracking code on your browser. That code lets Instagram (and other ad platforms) identify you and show you ads for those shoes -- or the shoe brand more generally -- as you browse other websites and apps. Retargeting follows you around the internet to remind you about things you showed interest in.

At work

Most website visitors don't buy on their first visit -- studies suggest 97-98% of first-time visitors leave without converting. Retargeting lets you reach those visitors again after they leave, showing them relevant ads as they browse other sites. Because these users already know your brand and visited your site, retargeting ads typically achieve much higher conversion rates than ads shown to cold audiences who've never heard of you.

Real-world examples

At home

Aisha browsed a sustainable clothing brand website, looked at several jackets, and left without buying. For the next two weeks, she saw ads for those jackets on Instagram and in Google display ads while reading news sites. When one ad included a 15% first purchase discount, she clicked and bought. The retailer's retargeting campaign had a conversion rate 8x higher than their cold audience campaigns.

At work

Marcus managed a SaaS company's digital advertising. He set up retargeting audiences segmented by funnel stage: visitors who only viewed the pricing page got ads emphasizing ROI and a free trial offer; visitors who started but didn't complete signup got ads with a '5 minutes to set up' message; existing trial users who hadn't upgraded saw ads highlighting premium features. Each segment had a distinct message and separately tracked conversion rate.

Common confusions

  • Many users assume retargeting means their device is being listened to or hacked — Retargeting works through tracking cookies and pixels placed on websites you visit, not through microphone or camera access. When you visit a website with a Meta Pixel installed, a cookie is placed in your browser. Meta then recognizes that cookie when you use Facebook or Instagram and shows you ads from that advertiser. This is a transparent (if often surprising) data practice governed by privacy policies, not surveillance of your conversations.
  • Some advertisers believe retargeting alone is a complete digital marketing strategy — Retargeting only reaches people who have already found you -- it can't grow your audience or attract new visitors. Retargeting campaigns need a continuous influx of new visitors from prospecting campaigns (search ads, social ads, SEO, content marketing) to maintain a retargeting pool. A business that spends its entire digital advertising budget on retargeting will see diminishing returns as the audience shrinks and saturates.

For analysts

When reviewing a client's paid advertising mix, check the ratio of prospecting (new audience) to retargeting spend. A common error is over-indexing on retargeting (because it shows impressive conversion rates) while under-investing in top-of-funnel prospecting that grows the pool of potential customers. Retargeting amplifies a working acquisition strategy -- it doesn't replace it.

History & origin

Retargeting emerged as a digital advertising capability in the early 2010s, enabled by the widespread adoption of tracking cookies and third-party ad networks. Criteo (founded 2005) pioneered retargeting as a service for e-commerce retailers, showing ads for products users had viewed but not purchased. Google's Remarketing Lists for Search Ads (RLSA, launched 2012) allowed bid adjustments for users who had previously visited your site when they performed subsequent searches. Facebook Custom Audiences (launched 2012) allowed advertisers to target website visitors on Facebook. The iOS 14.5 update (April 2021) and App Tracking Transparency (ATT) significantly disrupted cookie-based retargeting by limiting cross-app tracking on iOS devices, reducing retargeting accuracy for mobile audiences.