At TellApart, we’re reinventing the customer data platform for e-commerce companies because we believe that knowledge of one’s own customers has the potential to dramatically improve ROI across all online marketing applications. One of the key applications on this platform is Transactional Retargeting.
Informed by the past few months of client conversations, it’s clear that many top online retailers have had really poor experiences with their display ad retargeting efforts to date. But the underlying factors behind that lack of performance are also clear: old technology, inefficient vendor business models, sub-optimal creative formats, etc. We call this Retargeting 1.0.
Leveraging customer data on an entirely reinvented display ads infrastructure, we believe we’ve created a product and business model so radically different from the previous generation that it leads the way toward Retargeting 2.0.
Here’s a quick guide to tell apart the two:
1. Business model:
- 1.0 vendors charge CPMs or on CPAs that are massively overinflated by “view-throughs.” They have hidden fees, cumbersome I/Os, and generally attempt to constantly take credit for transactions that would have happened anyway.
- 2.0 vendors acknowledge the worth of an ad click, with the best charging only a rev-share on successful post-click conversions. Because the vendor only makes money when the client does, these campaigns are “always on” and grow each month as predictive models train on your data.
2. Customer-specific targeting:
- 1.0 retargeters, per their business model above, are incentivized to spread a thin layer of impressions on almost all users, resulting in undifferentiated & wasteful impressions that can over-saturate users… especially those who needed no ad to help them complete their transaction.
- 2.0 platforms use predictive modeling to seek out just those prospective customers who need a “nudge” toward a final transaction. Their modeling is specific to the user and the exact items in which they have shown the most interest. This yields maximum incremental revenue to your bottom line.
3. Real-Time Bidding
- 1.0 vendors place users into rough CPM buckets with hard frequency caps and buy impressions in chunks, creating in a sub-optimal user experience that typically results in either too few or too many ads being shown.
- 2.0 vendors utilize a new technique called real-time bidding (RTB) to bid per-impression, per-user. Combined with customer-specific modeling, this results in the right number of ads being shown to just those users whose conversion rates can be lifted with retargeted ads.
4. Dynamic creative assets:
- 1.0 vendors display static banner ads repeatedly, depressing click-thru rates (CTR) and thus, your potential revenue. Their platforms typically lack A/B testing frameworks to continuously optimize the ad creatives.
- 2.0 vendors use Flash-based, dynamic banners to insert the best information into the creative, automatically optimizing for CTR. Every element will be tested: product-images, copy, coupons, button color, animations, etc.
What’s the big picture?
Retargeting 2.0 is a no-brainer for online retailers, but there is a natural ceiling to its upside (based on the number of visitors to your site). You should ask, what’s the big vision beyond retargeting that will make this a worthwhile integration, beyond the immediate revenue lift?
While TellApart Transactional Retargeting uses customer data to generate 10x improved ROI over Retargeting 1.0, we believe this data will also unlock gains across every online marketing channel that you have. And the platform we have built will enable many applications powered by this customer data. That’s the big picture, and that’s where we’re headed with our clients today.
To find out more about what it’s like to work with a Retargeting 2.0 solution, contact us today.