Ad Retargeting Can Outperform Paid Search
- by Laurie Sullivan @lauriesullivan, April 28, 2009
FetchBack is
expected to release data Tuesday showing that its retargeting technology outperforms paid search in tangible returns on the dollars invested in each. Comparison tests done by the ad retargeting
company delivered between 74% and 112% higher return on investments (ROI), compared with paid search campaigns. Gross sales generated from the FetchBack Retargeting platform and paid search campaigns running at the same time were divided by the cost for each campaign.
For some advertisers, FetchBack Retargeting can outperform paid search campaigns from search engines such as Google and Yahoo. For others, the performance works just as well, according to Chad Little, FetchBack's president and CEO. "Similar to paid search, advertisers that can bid high on most keywords tend to do a better job at converting them, so it's dependent on the advertiser," he said.
FetchBack offers ad retargeting services. The company works with nearly 1,000 advertisers across a variety of networks. While companies can use retargeting to increase brand awareness, the service really aims to drive performance by retargeting the person who abandons the shopping cart or leave the site before downloading information.
Earlier this month, FetchBack began eating its own dog food, running a campaign about technology upgrades through ads served up to visitors on other sites within its network. Little said the campaign aims to inform people who come to browse the site. A pixel tag and browser cookie work together to serve up ads days later. Rather than restate FetchBack's position, the ads provide information about the technology that the company has been working on or recently introduced.
FetchBack has plans to launch a retargeting ad within the next two weeks that highlights the Web 2.0 release of its analytics package. The features provide insight into how many ads it takes for a consumer to return to the site and make a purchase or download a white paper after seeing an ad.
Analytics can give advertisers a better sense of a consumer's decision-making cycle. "Let's say the consumer takes three weeks from the first time they visit the site until they make a purchase," he said. "This tells you that after three weeks you can probably stop showing them the ads because they either are not going to make the purchase or they converted somewhere else."
FetchBack's ability to track sales through retargeting ads can identify when advertisers gain between 600% and 700% ROI. "For every $1 spent, retargeting generates between $6 and $10 in return on sales," Little said.
Little wants FetchBack to become the second-most-important innovation -- the first being paid search because of the way it has dominated the advertising market. "Paid search has it all," he said. "It is auction-based. The market sets the price. The ad is what people look for, which makes it highly effective."
It is important to understand that when any performance analysis is conducted that the determination of how conversions were appropriated is key. Ad retargeting utilizes view-based conversions and paid search utilizes click-based conversions. These are apples to oranges comparisons. Additionally, ad retargeting often gets conversion credit for other mediums efforts, such as email marketing campaigns and affiliate efforts.
FetchBack's analysis needs to account for these multiple marketing touches. It is unclear that this was done based on the details in the marketplace. The majority of firms offering re-targeting encourage view-through tracking and independent tracking outside of your ad-serving platform, the list including FetchBack. My experience has shown that about 90% of the view-through conversions coming from re-targeting need to be credited to another marketing medium. When you re-distributed the conversions, re-targeting comes nowhere near paid search performance, but it is definitely not too shabby.
While I am a big proponent of re-targeting efforts and believe that they should be a required component of every marketing mix, research that suggests a push medium outperforms a pull medium defies basic logic.
eBay has also experienced great results from retargeting. More on their experience at http://marketing-has-changed.com/how-ebay-gets-the-most-from-its-online-advertising/
Along the same lines, Google just released a whitepaper in which they say that ads in their content network are more cost effective than buying search. Interesting article on it: http://www.ppchero.com/highlights-from-googles-content-network-cpa-whitepaper/
For some advertisers, FetchBack Retargeting can outperform paid search campaigns from search engines such as Google and Yahoo. The keyword here is "some"