Mastering the Retargeting Campaign: Strategies for Higher Conversions

Retargeting is a set of techniques designed to keep your brand top of mind for consumers. For instance, when a shopper looks for a new watch for her husband’s birthday, she browses through several pages of a store’s website. She probably won’t purchase the first watch she sees, so she leaves the site without purchasing.

Retargeting ad campaigns then display the brand’s product ads on other websites and social media platforms that the shopper visits. The goal of these retargeting ads is to bring her back to the store’s website to purchase the watch she was considering for her husband’s gift.

The issue most retailers face with retargeting, however, is instability in third-party data acquisition. Google’s new cookie-tracking protection gives users an invisibility cloak when browsing online—and Apple’s App Tracking Transparency feature requires users to opt into (rather than out of) cookie tracking.

Ecommerce brands are reducing their reliance on third-party data, and collecting first-party data in an attempt to personalize the customer experience and create retargeting ads. This guide shares how to do it, with creative tips and examples of brands that are doing it well across acquisition, the shopping experience, conversion, and retention.

How retargeting campaigns work

Retargeting works because of a psychological principle called the mere-exposure effect. The gist of the theory is that the more times a person is exposed to something, the more likely they are to prefer it.

Television ad frequency has benefited from this principle for decades. When you see the same TV ads multiple times in offline marketing, companies rely on the fact that you’ll be so familiar with the company or product that you will naturally like and trust it more.

Here’s how online retargeting works and the different technologies behind it. 

Pixel-based retargeting

Pixel-based retargeting uses JavaScript code to collect customer data from visitors. The pixel drops an anonymous browser cookie in the visitor’s browser and feeds their activity back to the pixel platform (i.e., Meta or Google). This includes online behavior like:

• How long they spent on your site 
• Pages they’ve viewed
• How far they scrolled down the page 
• Whether they’ve initiated a checkout
• Products they’ve added to an online cart
• Items they’ve bought
• Whether they’ve signed up to your email list 

This retargeting method guarantees that ads are seen by people who have already visited your website. You can also get granular with segmentation based on pixel data—you can isolate website visitors who’ve visited a specific page but not bought anything, for example. 

The first step for retargeting is to make sure that you properly install your pixel. This code creates a list of people who’ve visited your website—without it, you won’t be able to track who’s visiting your site and how they’re behaving. Most advertising platforms have their own pixels and setup process. Shopify integrates with Meta Pixel (for Facebook and Instagram retargeting), Pinterest, TikTok, and Google Ads for easy setup.

Of course, pixels rely on cookies to track user activity—and people can disable cookies or opt out of tracking, making it impossible for you to follow their on-site behavior and retarget effectively. Cookie opt-out laws, like the EU Cookie Law, also require you to obtain explicit permission to place a cookie in a shopper’s browser. These popups can often feel intrusive for first-time visitors.

List-based retargeting

List-based retargeting uses lists of existing customers or visitors to show specific ads. Also known as custom audiences, this approach involves uploading a list of contacts to a retargeting platform to start showing ads to those contacts. It’s great if you want to retarget a list of:

• Email subscribers
• Event attendees
• People who’ve bought in-store 
• First-time customers
• Loyal or VIP customers

This retargeting method allows you to send personalized emails to convince visitors to revisit an offer. For example, you could export the list of people who’ve subscribed to an email popup that offered 10% off their first purchase—exclude people who already bought from the list, then remind the remaining potential customers of their discount code through targeted ads.

The effectiveness of this approach hinges on your ability to collect clean, recent data. That’s made easier with a unified commerce platform like Shopify, which acts as a single central repository for your customer, sales, and order data.

As Bobby Morrison, Shopify’s chief revenue officer, says: “Now, with third-party cookies behind us, marketers on Shopify already have everything they need to optimize their acquisition, shopping, and checkout experiences with the best data out there: the data they own.”

“This unified data model is the foundation of everything that comes next—the world’s best checkout, personalized shopping pages, laser-targeted outreach, and cost-effective customer acquisition.”

Retargeting platforms and tools

There are many options for implementing retargeting, including native advertising platforms that collect data on how people interacted with previous campaigns. Meta, for example, lets you reach people who’ve responded to an event you posted on Facebook through retargeting campaigns.

Third-party platforms like Adroll, Outbrain, Criterio and SharpSpring Ads also offer web and social retargeting. These tools track on-site behavior and combine it with mass market consumer data and behavior trends to optimize your retargeting ads.

Shopify Audiences, in particular, draws on aggregated first-party data to create better targeting. It uses commerce data from the millions of stores using Shopify to build targeted audience lists you can market to on the largest-reaching channels—and is proven to cut customer acquisition costs by up to 50%.

Luxury women’s apparel brand Mac Duggal turned to Shopify Audiences in an attempt to improve ad performance and retarget previously lost customers. They added Retargeting Boost to their existing Meta and Google ad sets and built a 2.3 times larger retargeting audience. The brand’s ROAS doubled, resulting in a 3.6 times lower cost per purchase through the retargeting ad set.

“While it was harder to get strong performance out of ads as a result of digital industry changes, Mac Duggal is now able to target more effectively and more efficiently through Shopify Audiences,” says Emily Greenfield, ecommerce director at Mac Duggal. “The solution allows us to reach new potential shoppers that are worth targeting.”

How to set up an effective retargeting campaign

Use ads to build audiences

It’s easy for eager companies to get sloppy with their campaigns and bombard prospects with aggressive advertising in hopes of a quick return. This feels invasive to customers, and can drive them to make a conscious decision not to purchase from your store. A lower-effort commitment, like getting them to opt into your newsletter, is more likely to keep them engaged. 

Use a retargeting campaign to get potential customers to sign up to your email list. From there on out, you won’t need to pay to advertise to them—emails are free for you to send, so you can reach out to them anytime you want.

For instance, if you sell high-end fashion apparel, offer customers a how-to guide on washing particular fabrics in exchange for their email address. Give customers the option to feel comfortable with your brand. That trust may lead to more sales over time.

The added advantage of email is that it helps you collect first-party data you can use for retargeting further along in the customer journey. For example, email apps like Klaviyo show what a recipient engages with. Subscribers who opt in through a discount incentive and click the link to your “Women’s dresses” collection page, for example, could see best-sellers in that category through retargeted Google Ads. 

Create dynamic retargeting ads

We live in an always-on environment, where within a couple of minutes we can receive one phone call, read three emails, and catch a cab. These interruptions result in customers abandoning shopping carts, or forgetting to revisit sites for days. 

Dynamic ads automatically show products that users have viewed on your website, increasing relevance and the likelihood of conversion. You might see these ads referred to as “Advantage+ catalog ads” on Meta, or “Dynamic Search Ads” on Google Ads.

You’ll need a pixel installed to connect these abandoned carts or browsing sessions with customer profiles, as well as a product catalog synced to the advertising platform. Shopify can handle both aspects through sales channel integrations. 

Capture attention with product page retargeting

When targeting high-intent users (people who’ve demonstrated an interest in your brand), your retargeting ad should remind them about the product they viewed last. 

This approach, known as product page retargeting, is the simplest way to profit from your advertising efforts. It involves getting people who’ve visited your store and looked at actual products to come back and buy them.

Product page retargeting works better in shorter windows—wait too long and shoppers might forget about the items they’ve viewed. Experiment with these time frames to see the optimal waiting period for your potential customers.

Localize the online experience

Multiple studies have proven that online shoppers would rather buy products in their own currency, on sites that use their native language—and they’re willing to exit a retailer’s website in search of a brand that allows them to do so. 

Use geographic segmentation to divide your customers based on their location. For each group, customize retargeting ads with that location’s:

• Language
• Currency
• Promoted payment methods 
• Shipping offers—including any applicable taxes or duties

📌Pro tip: Localize not just the advertisement that shoppers see, but the on-site experience they get when clicking through using Managed Markets. Translate online content, accept over 150 local currencies, and welcome international payment methods—without creating a new online storefront for each global audience.

“Managed Markets started as a solution to our international fulfillment problem,” says Gillian Gallant, owner and CEO of Paper Shoot Camera. “Since then, it’s grown into a powerful tool for helping us unlock and expand our global presence. Without it, we could not have grown as fast as we have.”

Advanced retargeting strategies for ecommerce 

Behavioral retargeting

Behavioral retargeting segments visitors based on their behavior on your website. With this approach, you can identify the stage of the sales funnel a particular prospect is in, the channels they’re likely using at that time, and the content they need to progress. 

Here are the behavioral segments you might want to consider:

• First-time visitors: Highlight the products that gained their initial attention, then direct them back to the same pages in your retargeted ads.
• People who visited specific pages: Visitors who read your blog post are higher in the sales funnel than those who click on a product page—they might not be open to a hard sell or product recommendation. Instead, prioritize getting their email address to share more value, so you’ll be top of mind when they’re looking for a solution. 
• Frequent visitors: Offer discounts to warm leads, such as frequent visitors to your website. If visitors click on your homepage, view your “About” page, and then browse your product pages, offer an incentive—like a free gift with their order, or free shipping on their first purchase—with retargeted campaigns.
• Cart recovery: Retarget the 70% of people who abandon online carts with a follow-up email or a retargeted ad to remind them of the products they left behind. Play on the biggest reasons for cart abandonment: promote buy now, pay later offers, guest checkout, or free shipping. FUNNYFUZZY used Shopify to trigger these cart recovery emails and increased its conversion rate by over 40%.
• Premium buyers: Big spenders will likely purchase more from you if you retarget with cross-selling or upselling options. Don’t be afraid to communicate your latest products through retargeted campaigns that reach this segment.

You could also retarget existing customers after releasing a new feature or pricing plan update. This type of campaign can yield great results, especially for inactive customers. A beauty retailer that offers a monthly subscription service, for example, could retarget customers to upsell a more expensive tier. 

📌Pro tip: Shopify has its own segmentation capabilities to divide customers based on qualities they share. Group them based on their geographic location, lifetime value, and buying frequency—without manually slicing and dicing customer data yourself repeatedly. 

“We identified the segment in Shopify, created a discount, communicated with them in a way that was very personalized, and we saw about 30% of those people convert,” says Alex Dashefsky, cofounder of Airsign.

Retargeting by time

Time-based retargeting tailors your campaigns based on how much time has passed since a customer’s last interaction with your brand. It can be combined with behavioral targeting to prevent ad fatigue—showing the same ad too soon can irritate online users and create a negative perception.

Here are some time-based examples:

• Within 1 hour: Retargeted email to show the items someone left in their cart
• Within 24 hours: Retargeted social media ad to show the products they abandoned
• Within 7 days: Collection ad that retargets website visitors who visited a specific page but didn’t buy
• Within 14 days: Email upsell to customers who made a purchase 
• Within 30* days: “Ready to restock?” email to customers who bought a specific product that will need replenishment

*This time frame will change based on your average purchasing frequency. A dental brand whose mouthwash lasts for one month before it requires replenishing, for example, might want to retarget existing customers 21 days after their last purchase. This gives them enough time to buy and have their item delivered for a continuous supply.

Lean on retargeting exclusions

Most advertising platforms bill by view, so the more people you target, the higher your advertising costs will be. This becomes an issue if you’re not excluding people who have already completed the action you’re incentivizing. 

Let’s do some napkin math to illustrate: You upload a custom audience list to Facebook to retarget people who’ve visited your product page. Of the 100,000 people on the list, 15% of them have already bought the product you’re promoting. You’re paying to reach 85,000 Facebook users. With an average CPM of $10.32, that’s over $877 you’re potentially wasting by targeting existing customers through the retargeted product page campaign. 

Retargeting ads on social media platforms

Social media is a great way to retarget potential or existing customers because almost everyone uses at least one platform. Per Data Reportal, some 94.5% of the world’s internet users access social media at least once per month. You just need to figure out which platforms your target audience is using to effectively retarget them there. 

Most social commerce platforms have their own retargeting capabilities to make it easier to reach those who have already interacted with you, including:

• Facebook and Instagram (Meta) retargeting: Meta retargeting is a process of finding people who’ve visited your website and using their data to find their Facebook or Instagram profiles. You can run an ad campaign to target those people and convince them to head back to your website. The Meta Ads Manager (formerly known as the Facebook Ads Manager) handles all of this for you, so there’s no need to painstakingly match email addresses to profiles.
• TikTok retargeting: TikTok knows who’s visited your TikTok Shop or downloaded your app on a smartphone. You can also upload custom lists to the TikTok Ads Manager to match specific user behavior with TikTok profiles. 
• Pinterest retargeting: ThePinterest ad platform lets you run dynamic ads. You can reach the 50% of Pinterest users who use it as a place to shop by retargeting people who’ve already interacted with your brand elsewhere. 
• LinkedIn retargeting: If you’re selling B2B, retarget audiences on LinkedIn based on activities like company-page visits, lead-gen form responses, and LinkedIn event RSVPs. To collect website visitor information, set up the LinkedIn Insight Tag.

📌Pro tip: Supplement your custom audience lists with Shopify Audiences. Proven to drive up to two times more retargeting conversions for every dollar spent on retargeting, it’s no wonder why Shopify Audience merchants reduce their cost per acquisition by up to 50%.

Google Ads remarketing 

Google Ads remarketing campaigns work by reconnecting with anonymous website visitors and offering a seamless and instantaneous means of re-engaging potential customers post-visit. The platform allows you to customize lists, run tests, and optimize ads, and offers various types of retargeting campaigns to experiment with.

What’s unique about Google is that it’s not just the search engine that you can show retargeted ads in. Google Shopping aside, you can use the Google and YouTube app to run retargeting campaigns on:

• Google Display Network: Over two million publishers use Google AdSense to serve ads on their website, apps, or videos. The display ad format is great for impressions—retargeted ads show up when your targeted audience surfs the internet, not just specific social media platforms.
• YouTube. Link your YouTube channel to your Google Ads account and retarget people who’ve viewed, interacted with, or subscribed to your channel. If someone liked your “Capsule wardrobe” video playlist, for example, you could retarget them on YouTube to promote your “Apparel basics” collection.

Email retargeting campaign

Segment your ads by geographic region, interests, behaviors, age, and other demographics to hone in on your audience. Examples of popular email retargeting strategies include:

• Cart recovery emails, a form of dynamic ad that shows the products someone abandoned on a recent visit
• Personalized product recommendations, which you can offer by digesting zero-party data willingly volunteered by your audience through quizzes or feedback surveys 
• “We miss you!” emails, which rengage lost customers and convince them to buy again

But remember: Even as your email list grows, it’s not a magic bullet. People might not open your email—and even when they do, there’s no guarantee that they’ll take action. That’s why email marketing works best when combined with retargeting campaigns, which reinforce the message and reach out to your customers beyond the inbox. 

How to optimize retargeting campaigns

Evaluate retargeting costs 

Although retargeting campaigns naturally drive more conversions due to their personalized nature, customer acquisition costs (CAC) are rising across the board. Today it’s 60% more expensive to acquire a customer than it was five years ago.

Regularly check in on CAC and benchmark it to customer lifetime value (CLV)—not just for that retargeting campaign, but the entire budget you’ve spent to get the customers’ attention in the first place. If you spend $5,000 on a Facebook advertising campaign targeting new traffic, a further $15,000 to bring them back with a dynamic retargeting ad, and 480 customers buy, will each one spend more than the $42 you’ve splashed to acquire them? 

Test homepage and collection page retargeting ads

Not every retargeting campaign has to promote a product. That’s not to say the goal should be something other than a sale—but homepage or collection page ads differ from product page ads because the viewers have never seen a product. 

People browsing a homepage or collection page might not be ready to buy a specific product, but know they have an issue to solve or a goal to achieve. Play on the pain points shared by your buyer persona. A stationery brand, for example, might promote a UGC video of a creator sharing their optimal morning routine (which includes journaling) and link to the brand’s “Journal” collection page.

A/B test the offer and creative

Destination URL aside, there are multiple ways to experiment with retargeting campaigns. What engages one audience won’t be the best way to capture another, so experiment with different offers, creatives, and ad messaging to find the optimal combination for each segment. 

Say that you’re optimizing a Facebook campaign that retargets first-time customers of your skincare products. You want to squeeze more revenue out of these existing customers because it’s more cost-effective than acquiring new ones. So, you experiment with:

• Creatives and ad format: Does user-generated content produced by influencers get more attention than video ads you’ve produced?
• Subject line: What entices people to click your retargeted emails?
• Messaging: Do people respond better to microcopy in the first person or third person?
• Campaign goal: Is it cheaper to acquire email subscribers when the Facebook advertising goal is “Leads” or “Engagement”?
• Timing: Do you recover more carts when sending a retargeted email 1 hour or 4 hours after a shopper’s exited session?
• Exclusions: Is your ROAS higher when you exclude specific audience lists?

Measuring success and ROI of retargeting

Regular evaluation is the best way to save money on retargeting. For each campaign, track website clicks, reach, CTR, CPC, and total ad spend at least twice per week to compare them to your initial goals. 

Use this data to refine your targeting and improve your ad creative. If it becomes obvious that UGC outperforms branded videos, for example, work with more influencers to produce more UGC and keep the content fresh. 

It helps to use CRM to look at the performance of your destination URL. The Klaviyo app for Shopify, for example, integrates with CRMs like HubSpot so you can track views, clicks, and submissions back to specific retargeting campaigns. What’s most effective—not just for getting your customers’ attention, but doing it in the most cost-effective way? Double down on the answer.

The all-new Shopify Analytics dashboard can surface these metrics without custom-coding a reporting dashboard. View your most important marketing metrics, isolate on-site activity—like revenue and orders—by channel, and benchmark your KPIs against similar stores without leaving your Shopify admin. You can make smarter marketing decisions based on actual data, as opposed to gut instinct.

Identify your highest-priority segments—and retarget them effectively—with first-party data on Shopify 

First-party data is the crucial piece of the retargeting puzzle. Only when you can lift the lid on what your audience is already doing can you identify the highest-priority segments and leverage their data to better retarget them. 

As an innovator in the space, with thousands of engineers dedicated to innovation research, Shopify offers a core customer data model that is built on first- rather than third-party data—and is fully unified and able to plug directly into every core function needed to personalize the customer experience, including retargeting.

It doesn’t matter where a customer interaction takes place—whether they click a link in Klaviyo email or visit your popup store—it’s all there in Shopify. This core customer model allows for granular retargeting—like offering customers personalized product recommendations through Facebook Ads that show new products complementary to those they bought in-store. 

Deliver the right message to the right audience with retargeting

When you combine a stellar first-party data-driven retargeting strategy with visually engaging content and adept ecommerce copywriting that actively addresses visitors’ queries and showcases the value of your offerings, your customers will be much more likely to engage—and to head right to checkout.