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Win back lost customers

With a cross-channel retargeting strategy, brands can improve customer conversion rates

Sonali Chowdhury 

Did you know nearly 98 per cent of the first-time visitors on your website leave without purchasing anything? While some visitors browse the site for a short while and then move on, others add items to their cart but abandon it without going through the purchase process. If window shopping is a problem for brick-and-mortar retailers, shopping cart abandonment is one metric that keeps a large number of e-commerce bosses awake at night.

So what does one do? The first option would be to make the shopping experience so compelling for consumers that they complete the purchase loop. Second, if they do indeed exit, you need to find ways to bring them back to the site. Over 90 per cent of marketers responding to a recent survey by global retargeting company, AdRoll, said that retargeted ads are as good as or even better than the gold standard in digital marketing, search ads, to do the job.

What is retargeting? In simple terms, in retargeting, e-tailers try to bring back lapsed customers by showing relevant ads on other websites so that they come back to the original e-store for their next purchase. Today retargeting forms part of the monthly digital budget of most e-tailers and run throughout the year just like search marketing. "Retargeting helps convert users at one-and-a-half to two-and-a-half times the website's standard conversion rate. Typically the budgets for retargeting is 10-15 per cent of the total digital spend but it could be more," says Subra Krishnan, VP, products, Vizury. Adds Praveen Sinha, founder and MD, Jabong, "Retargeting is a high return-on-investment campaign, hence, budget expansion is easier on this."

Traditionally, retargeting had been strongly associated with performance marketing and the return on investment. But the concept is being redefined today. "It has become a customer value programme. Retargeting helps in extracting the value of the data generated and ploughing it back into the system to engage dormant or active customers," says Narayan Murthy, VP, global sales and strategy, Vserv.

A retargeting would vary depending on the category and sector you operate in. Here's how you can retarget effectively and then figure out when to pull the plug.

Cracking down on the problem

Like everything else, the starting point would be the consumer - understanding her needs and why she was on the said website in the first place.

The interest of the user could be defined in a variety of ways during the customer's journey. Some parameters to look at are: how many times the user has visited the site, which products and how many products did she see, how deep did she go into the website (cart versus home page), buying history and so on. If a customer has shown a greater propensity to convert then you can target her more aggressively. "The key to retargeting lies in creating a customised message," says Krishnan. For example, you may show a 'static ad' of a product, a 'semi dynamic ad,' which will include price, discount etc, or a 'fully dynamic ad' where other relevant products with their prices are shown.

Mostly e-tailers segment the audience under heads such as abandoned users, product viewers, category viewers, checkout users, and so on. By doing that they can use different communication plans for each segment to target them better. For instance, Lenskart's first-frame-free offer was not shown to visitors who have already made a purchase from the site. Such repeat visitors were rather shown the latest collection of its eyewear.

The next question is, which medium should a brand use to retarget. Ideally, brands should engage customers in all the channels - display advertising, Facebook marketing, email, SMSes, notifications, mobile ads, apps - in a unified manner.

It is also important to time your retargeting efforts. For example, if someone has ordered monthly disposable lenses then Lenskart starts reminding the user with messages to change her lenses before the expiry date. "We keep a close check on the performance of each segment and measure metrics like click-through rate, conversion rate, cost per action and ROI on a daily basis," says Peyush Bansal, CEO and founder,

Retargeting can prove especially helpful in a category like furniture where the purchase cycles are longer. "If a customer is looking to buy a sofa, she may take 10-30 days to make a decision. Hence, by effective targeting, we can stay relevant in her decision- making frame and tailor offers depending on how far she has progressed in the purchase cycle," says Vikram Chopra, CEO & founder,

In the e-commerce space, the entire game is moving to apps. "App re-targeting makes more business sense and companies have been investing heavily on data-led retargeting via apps. We have seen four-five times better conversion ratios in apps compared to mobile web," says Murthy.

Vserve offers two retargeting platforms - Smart RT and Smart Connect. Smart RT is capable of retargeting customers from desktop to mobile and show ads to consumers in real time with customised content. Smart Connect helps leverage offline consumer intent to help brands remarket to their consumers across mobile sites and apps. Data collection tags are implemented in apps and mobile web pages and then passed into Vserv servers. The information passed on in the server contains encrypted data about the user. Once the system deciphers this data, it starts running a match for the similar user with the same unique identity variable for audience identification. After the user is identified, a predetermined action-oriented communication is shown to the user with a clear call-to-action. The final step would be closure or re-engaging the customer into the client funnel.

In a campaign there can be multiple elements to entice a user to respond. Hence, retargeting potential buyers with different styles of communication and channel is important.

Pulling the plug

Companies need to consider two metrics - conversion and RoI - to determine the effectiveness of a retargeting "Typically for e-commerce companies, 5-10 per cent of daily sales should come from retargeting. The next thing would be to check the return on investment," tells Krishnan. You also need to consider if the campaign is enabling traction on higher margin or lower margin products.

Besides this, you have to keep in mind that the retargeting efforts should not prove to be a dampener because there is a thin line between following up, reminding or retargeting and spamming. There has to be a way to identify the customer you are retargeting and stop at the right time. "The decision is mostly based on mature algorithm and judgment that help to determine that we are not moving in the direction of spamming and it doesn't become a noise," says Sinha of Jabong.

To get this right the first step would be to exclude customers who have completed a transaction or to identify users who have lost interest based on their user score that factors in responses to ads. "Don't overdo campaigns; you will end up with higher opt-outs from emails," says Kalpit Jain, chief operating officer, netCORE.

Travel portal Makemytrip retargets customers more aggressively when she is close to the departure date. Customers are not retargeted for the second time if there was no conversion at the first instance.

At the same time it is crucial that companies don't compromise on the privacy of the consumer while retargeting. It has to be a controlled to ensure that you don't over-sell or reach out on too many channels, creating a lot of noise in the process. Most important, give the power to opt out of ads or emails targeted at the customer.

In other words, let the controls be in the hands of the customer.

Get the cheese, avoid the traps

Avoid these pitfalls when designing a retargeting strategy:

w Unmanaged frequency: Frequency is defined as the average number of times a unique visitor is exposed to an ad over a period of time. If it is too high, it would make a visitor feel overwhelmed

w Using same messaging for retargeting: Showing the same ad over and over again can annoy users exposed to it. One of the advantages of retargeting is that you can personalise the message based on the actions a visitor has taken on the website.

w Improper user segmentation: Ads should be relevant to anyone who sees them. Identify those who have shown interest in the brand and retarget only that segment.

- With inputs from Make My Trip

Tripti Lochan
Tripti Lochan
Three ways to make re-targeting work better: Tripti Lochan
Expert take

Ensuring that consumers return to a brand or third-party website to buy a product or service of interest is the focal point of re-targeting. The reason re-targeting works for the marketer is fairly easy to fathom. First, it is about building a funnel of consumers who have interacted with your brand already and shown interest in a product/service. Second, it ushers these consumers through the conversion funnel by bringing the message back in their view. So re-targeting is integral to the marketing mix. If we can create additional sales at no or little cost, then we are achieving the best possible return on investment (RoI). Having said this, there are some guideposts, which will help us make re-targeting work better:

w Keep in mind that re-targeting is a process and over a period of time you will know which audiences are more likely to convert. To work out optimal re-targeting frequency, find out those consumers within a target audience segment who don't buy and marry them with those who take a longer time to be persuaded to buy. This way you can work out the optimal re-targeting frequency.

w Ensure that you retarget with the right message. If you target consumers with a generic messages, you are likely to waste marketing money. Also, if you are far too specific in retargeting, you risk being seen as a quasi-stalker.

w In e-commerce, it is easier for e-retailers to define their RoI because any retargeting activity can be seamlessly linked back to online sales. However, for marketers who don not have any e-commerce presence, this becomes a little trickier. We have to find ways to close the loop at stores and counters to measure effectiveness of re-targeting.

Tripti Lochan

First Published: Mon, March 30 2015. 00:15 IST