Setting the Right Retargeting Goals
How to Choose the Right Retargeting Goals for your Business
Goals, we all have them. And there’s no better time to examine and renew your pursuit of them than the upcoming new year. And we’re not just talking personal goals either — with the holiday rush finishing soon, this is a great time to examine your marketing goals as well.
New year’s resolutions are popular for a reason. Setting goals can be fun! But just like setting a goal of benching 300 lbs by the end of January is unrealistic, so too is setting retargeting campaign goals that just can’t be achieved. That’s why it’s important to set the right goals when launching a retargeting campaign, not only for your own expectations, but to manage the expectations of your business as a whole.
Understand the Context
The most important thing to remember when it comes to retargeting is that you are dealing with a finite number of users you can reach. Because your retargeting campaigns can only target users who have visited your site, that immediately sets a limit on who you can reach. That number doesn’t change without more site traffic (which is why prospecting campaigns are so important).
Another thing to consider are the basic laws of internet ecommerce. The average conversion rate for ecommerce sites is around 3%, which when combined with the size of your retargeting pool, makes for a limited number of potential conversions. Importantly, it sets a limit on the amount of revenue, in proportion to your spend, you can realistically generate from your retargeting campaigns.
So what can the intelligent marketer do in this situation to increase the effectiveness of their marketing dollar and hit their goals? Start by setting realistic goals. By understanding the swimlane retargeting occupies, you can better anticipate what makes for a weak, reasonable, or ambitious goal.
As an example, let’s examine two conversion-related goals you can set in the SteelHouse Advertising Suite — eCPA and ROAS — and determine what would be a realistic goal for your business.
Retargeting Goals to Drive Conversions
We know that the most important goals for performance marketers revolve around metrics that help the bottom line, which is why our Advertising Suite has the option to select a ROAS or an eCPA goal. So what do those acronyms mean?
> ROAS | Stands for Return on Ad Spend, which is the amount of revenue generated by your campaign’s spend. To calculate ROAS, simply divide your campaign’s revenue by its spend. For example, if a campaign generated $20,000 and spent $10,000, that is a ROAS of 2:1.
> eCPA | The tiny “e” in eCPA stands for “effective,” meaning it denotes the actual cost per acquisition. To determine your eCPA, you simply divide your total campaign spend by the number of acquisitions (or conversions) your campaign collected. So if you spent $10,000 and netted 500 conversions, your eCPA would be $20.
How to Determine Your Goals
There are a few key numbers to identify to help you set realistic goals. Think of these numbers as the space your retargeting campaign has to operate.
> Monthly Unique Visitors (MUV) | How many MUVs does your site have? This will determine the size of your retargeting pool.
> Your Site Conversion Rate | Historically speaking, how many of your site visitors convert? Is it close to the industry standard of 3%? Is it higher? Lower?
> Your Campaign Budget | This will determine how far your ads get — a higher budget will get your ads in front of more people, just as a lower budget won’t win you as many placements.
> Average Order Value | This number gives you an idea of how much revenue each conversion brings in.
So let’s say your MUV is 100,000 and your site’s conversion rate is 3%. Once we multiply the two together, we can see that your particular brand is looking at about 3,000 site conversions in a given month. By then looking at your own total marketing mix (email, display, social, etc.), you can better understand how much of that 3% retargeting has traditionally been responsible for. Armed with this knowledge, you should be able to set a realistic goal for your current retargeting campaign.
If you fail to do this, you run the risk of setting unrealistic expectations around your retargeting campaign goal. You would put yourself in the position of being disappointed with a campaign that actually performed admirably. The campaign did its job — it’s the expectations that came up short. This is why setting realistic goals can be the difference between a successful campaign, and an uncomfortable performance meeting with your boss.
Tips to Move the Needle
Once you’ve set a realistic goal, there are a few other ways to help ensure your campaigns are a success. Here are a few other thing to keep in mind to ensure your campaign is hitting its potential.
> Increase Your Spend | The more you spend, the more leverage you give your vendor to try every avenue possible to target those users who have the highest potential to purchase.
> Use Beautiful Creative | Using the right ads that look great and grab your customer’s attention can go a long way. Check out our guide here.
> Match Your Message to Your Audience | Adapt your copy to whoever you’re trying to connect with to better address what matters most to them. You can play up the value props that you know will reach them, thus making your ad much more click-worthy.
When you set the right goals and utilize sound campaign fundamentals, you’re setting your campaigns up to perform at or above your expectations. After all, the first step to running a successful campaign is ensuring you’re giving yourself the chance to succeed.