While most digital marketers and online business owners are familiar with the concept of “remarketing” or “retargeting,” it is a step in the marketing process that is too often downplayed or overlooked in favour of reaching as many people as possible.
There are, however, a few reasons why focusing entirely on reaching new people isn’t likely to get you the results that you want. Of course, there are exceptions to every rule, but here are a few reasons why remarketing might be your new best friend.
1. Consistent Customers Equals Consistent Revenue
While it’s true that acquiring new customers is essential to the growth of any given business, maintaining repeat customers is essential to a business’s longevity. Imagine that you own a diner in a small town. If everybody in town eats at your diner on the opening day then you might make some good money; but if none of them come back, it’s going to be hard to keep that business alive. One way to keep people coming back is to use remarketing ads to remind them that you’re still in town – just don’t beat them over the head with it.
In fact, according to an article published by Forbes, increasing customer retention rates by a mere 5% can yield an increase in profits from as much as 25-95%. That’s right, retaining an additional 5% of your existing customer base may be enough to nearly double your revenue.
2. Existing Customers Have Higher Value Than New Customers
Here are two more important stats from Forbes:
- Existing customers spend 31% more than new customers.
- Existing customers are 50% more likely to try new products.
Everyone has their brand. Once people fall in love with yours, they’re going to be much more eager to add new items to their collection. We all know at least one person who, as we speak, is lacing up their Adidas Superstars and zipping up their two-piece Adidas tracksuit as they head out the door. Don’t underestimate the importance of brand loyalty!
3. Not Everyone Converts The First Time They Visit Your Site
In the past five years, the cost of acquiring a new customer has increased by almost 50%. What this often means in the digital marketing world, is that you may need to show your ads to people more than once before they convert. Since online competition is continuing to grow across almost all industries, this may be truer now than ever before – especially with the ongoing COVID-19 pandemic and lingering restrictions on brick-and-mortar business in some parts of the world, including Toronto.
In 2020, U.S. consumers spent a whopping $792 billion online, which was 32.4% more than in 2019. While this certainly means more opportunity, it also means more competition, which means more ads being targeted at your customers by your competitors.
If someone goes out of their way to click on your ad but doesn’t make a purchase, it doesn’t mean that they never will. They might just be a tougher sell – or they might be busy. There’s plenty of bright lights and distractions on the internet, as well as in the outside world. Elements of both will be fighting for your customer’s attention.
Another factor to consider is that you don’t have much control over the circumstances in which your ads are shown to people. Perhaps, someone clicks on your ad while they’re making their morning commute to work. When was the last time you had your credit card out while you were riding the bus?
4. Returning Visitors Behave Differently than First-Timers
Once the ice has been broken between you and your prospective customers, they may be more trusting and more open to giving your brand a try. After all, very few people trust somebody the first time they meet them. The same goes for businesses – especially businesses that are online. Bringing people back to your store is an essential step in the marketing funnel.
This fashion brand, for example, received 70% of its total revenue from returning visitors during the first half of 2021. Not return customers, mind you, but returning visitors. Meaning that most website visitors weren’t ready to convert until they’d already been on the site at least once.
In this case, returning users were six times more likely to make a purchase, and those that did make a purchase spent more than three times as much money as new users. It is also worth noting that this segment of returning visitors, where 70% of the revenue came from, made up only 35% of the website’s traffic as a whole.
Remarketing can help you convert some of the more frugal or reserved online shoppers, increase brand loyalty, increase revenue, and create a consistent customer base that you can count on to keep your business alive and well.
For more information on remarketing and other media management services offered at TechWyse, click here.
Thank you for sharing the valuable content about “Remarketing” and the Importance of Online shopping.