Consumers don’t usually “Buy now.” But given some time, a lot of them do buy later. Brick-and-mortar merchandisers, who for decades have measured the buying (and non-buying) patterns of shoppers, understand that up to 72% of shoppers who come into a store to purchase a specific item will leave the store without having made that purchase. In the online world where the case is even more acute, 97% of visitors leave an ecommerce site without making a purchase.
The well-kept secret of the in-store world: of those shoppers who did not make the purchase, 67% of them actually make the purchase later. This underserved market of laggard buyers is a goldmine for online marketers who have discovered the effectiveness of remarketing, in which brands get another shot at the departed prospect. The key to remarketing can be broken down into two consumer traits:
- How interested in the product were they in the first place?
- How much permission have they given the marketer to reengage them?
The success rate of four remarketing efforts—ad retargeting, social marketing, abandoned shopping cart marketing, remind-me service—illustrates the effectiveness of a campaign based on these criteria.
Ad retargeting lets a brand reach people who have previously visited the brand’s site by showing them relevant ads when they visit other sites. By re-displaying an ad several times within a short period after the initial visit, marketers commonly speak of getting back to those days of a 2 to 3% click-through rate.
However, there still exists a large drop-off. After all, many users leave a site without making a purchase because their interest in that particular product was low in the first place. Because users didn’t explicitly raise their hand to receive further information, it’s not uncommon to hear consumers complain about the eeriness of ads that follow them around the web. A recent Pew study shows that 59% of users are aware of targeted ads, and a whopping 68% view them negatively.
This has led to new ways of retargeting the consumer, focusing on places where they have more consciously expressed interest in a specific product, or are more receptive to a remarketing campaign because they’ve voluntarily provided contact information. Social marketing has focused on the former—capturing a user’s early interest—while companies that use abandoned shopping cart information leverage the fact that the user has provided contact information. A new approach, remind me services, combines the best features of both.
Social marketing has become a staple of advertising among many brands. Campaigns will often include a call-to-action to “like” the brand on Facebook or connect on another social network. Such a declaration provides the brand with future opportunities for targeted advertising within that social network, making sure its new ads reach an audience that has already indicated a willingness to consider.
While “liking” or “following” a brand grants the permission to target users with ads, the overall interest in those ads is still questionable because of the motives behind a like or follow. For example, customers often opt-in to a brand on a social network to win prizes. Customers who are interested in something for free are not the same as potential paying customers.
Abandoned shopping cart marketing leverages the fact that many visitors to an ecommerce site get as far as putting an item in the shopping cart, and even providing an email address, only to abandon the site without making a purchase. So close, yet so far. However, there’s still a way to reach those “almost customers” with a follow-up email containing a simple reminder, a survey question, or a special offer. Studies have shown that such remarketing can help increase return visits to the site by as much as 26%.
While abandoned shopping cart remarketing scores well on both the level of interest expressed by a user and on implied permission to be contacted, because the brand doesn’t typically own the shopping cart (it’s retail partner does) reengagement is challenging. If a brand sells through third-party online stores, it is the store that has to decide to exploit abandoned shopping cart remarketing.
“Remind Me” services focus early on in the demand-generation stage of the shopping funnel. Product-centric blogs, review sites, and even digital magazines will use remind-me services to allow a reader to request a reminder about a product they’ve discovered on that blog. Because reminders leverage both high initial interest and explicit permission to reengage, they have enjoyed click-through rates of close to 20%. What’s more, deferred purchases tend to have a life well beyond the initial date, with interest in the product sustained for up to three months.
The trick for brands, of course, is finding a way to participate in the reengagement process—or create their own reminder service. Right now, the relationship is between the reminder service and the reader. When brands partner with a reminder service directly, they can provide valid “reminder worthy” content and events that target a very specific community of highly qualified leads.
Michael Maggio is chief marketing officer of ShopAdvisor.