Retargeting with media buys is a practice that displays ads to users that have previously visited your site.
Generally, you would retarget users that are yet to convert on your site. These types of ads usually get a very high CTR since users recognise the brand and/or product. It’s very possible users opened up a new tab, lost focus on the page and are still waiting to convert. Retargeting is extremely powerful and provides strong conversion rates. Do note however, you need to be careful not to serve too many impressions to one user in a certain time frame otherwise you’ll start to look a little spammy, which could have long term detrimental effects to your brand.
How Does Retargeting Work?
The ad network will give you a tracking pixel that you would place on your landing page (and any additional high traffic pages you see fit) and then another pixel for your conversion page (i.e. order complete / thank you page). If the user hits the first pixel but doesn’t hit the conversion pixel, that user will be targeted with ads almost immediately.
Ad networks record the IP address and set cookies of each user, this enables them to trigger targeted ads to consumers.
Operating On Exchanges
Here’s a little information if you’re operating on exchanges such as; rightmedia, doubleclick, openx, adbrite, adsdaq etc. All CPM retargeting should be dynamic, meaning the cost of each singular impression changes based on competition for that impression. High bids (i.e. $4 avg. cpm) will ensure you open all floors and get the most of the available impressions for those users.
Obviously going in at huge CPM rates to mop up the inventory may not be wise, always project your CTR against impressions and work back from your conversion rates/leads and you’ll come up with a profitable CPM cost (if it exists!).