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Advertisers Beware: Your Retargeting Attribution May Be Flawed

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Is your retargeting solution truly effective? The answer to that question is not always clear. While many solutions may claim to drive sales, a black-box approach and lack of in-depth reporting keeps many advertisers in the dark and prevents them from crafting truly impactful retargeting campaigns.

Why does a lack of transparency lead to flawed retargeting attribution, and what can you do to remedy this situation? Here’s what advertisers need to be aware of so they can run retargeting campaigns that drive true incremental return.

A lack of transparency changes everything

Today, many retargeting solutions shield advertisers from valuable insights into the actual impact of their retargeting campaigns. This lack of transparency gives these vendors the ability to claim responsibility for a sale or conversion that may have happened regardless.

Incrementality graph - Incrementality and attribution

The graph above illustrates this point. Both Meghan and Carmen viewed and added a product to their digital cart on an ecommerce site, yet both left before completing the purchase. Meghan, who had an initially lower purchase intent, returned to finish purchase after being retargeted with a Dynamic Ad featuring the item she had added to her shopping cart. In this instance, Meghan’s purchase can be attributed to the retargeting campaign.

Carmen also added an item to her shopping cart and then abandoned it. However, Carmen had a higher purchase intent, and based on past actions was very likely to return to the site and complete the sale. Regardless, she was still shown a retargeting ad. Because she would have likely returned to complete her purchase regardless if she was retargeted, the Dynamic Ad had little influence on her decision. A retargeting solution that lacked transparency could take easily credit for this sale, even though the retargeting campaign ultimately was not responsible for this result.

The impact is huge

The approach described above can have a negative impact on many aspects of your campaigns.

Because ad spend is unnecessarily delegated to reach shoppers like Carmen who will purchase regardless of retargeting ads, marketing teams are not fully optimizing their ad budget. This wasted ad spend could be put to good use reaching shoppers like Meghan, with whom retargeting ads will have a much greater impact.

Incrementality and attribution 1Additionally, this approach provides you with a limited understanding of what actually drives success. By blindly retargeting every shopping cart abandoner, advertisers have no insight into or optimization towards incrementality. It also robs you of the ability to measure performance along multiple touchpoints or automatically optimize towards channels with higher return on ad spend (ROAS).

Cursory reporting goes hand-in-hand with this approach. Many retargeting vendors fail to provide detailed reporting options that allow advertisers to actually gain insights into which strategies work. High-level reports does more than prevent you from drilling deeper to gain more meaningful knowledge. It also means that your vendor is essentially grading their own homework, giving you a limited understanding into whether or not you’re actually getting what you paid for.

It doesn’t have to be this way

Incrementality and Attribution 2None of these issues arise when you have full transparency at your disposal. The ability to understand every detail of your retargeting campaigns at a granular level means that you can get a 360-degree of your performance and measure the true impact of your retargeting efforts. In turn, this will empower you to make necessary spend and targeting adjustments, in addition to optimizing for incrementality.

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