Is remarketing expensive?
Are remarketing clicks a ‘good deal’? It used to be that remarketing clicks were cheaper than regular keyword-driven clicks. This is generally no longer the case.
Click prices are roughly comparable between remarketing display and Google search, it’s just more likely that a remarketing click will convert because the person clicking already knows you.
At least, that’s the theory. Cetaris paribus, as an economist might say.
In practice, remarketing clicks don’t always convert better. You have to ask… how well do the people in your remarketing audiences really know you? If somebody visited your website once three weeks ago, do you still consider them as ‘warm’?
Remarketing audiences are transient, and go cold quickly. Much more so than email. As long as your emails in the past were good you can usually get away with not emailing somebody for a while. You don’t get that luxury with remarketing.
Because your remarketing audiences quickly go cold, you want to spend more money on the people who were active most recently. Catalogue marketers call this principle ‘RFM’, which stands for recency, frequency and money.
RFM is a universal principle. Every pub landlord knows that the most likely person to step into the pub next is going to be the last person who left, followed by the person who steps into the pub most frequently, followed by the person who spends the most money in the pub overall. (I’ve rigorously tested that example).
RFM applies to telephone conversations. The next person to call you will most likely be the person who called you last. Followed by the person who calls you most frequently. Followed by the person who spends the most time on the phone with you overall.
In remarketing terms, the most likely contact to convert is the one who was on your website most recently. Followed by the person who keeps coming back. Followed by the person who spends the most time on your site overall. Of the three, recency is the biggest indicator of future purchase intent. (Or future likelihood to convert).
You minimise your remarketing risk by focusing your campaigns around the contacts with the highest RFM score, with recency being the most important factor.
Most remarketing campaigns that I audit operate with relatively long audience durations, often 30 days or more. (Facebook will let you keep people in an audience for 180 days, Google for 540 days).
You might still want to build those long term audiences, but they often won’t be a big part of your advertising strategy. It’s easy to waste money when you’re advertising to somebody for 30 days. It’s less likely when they only see your ads for a day or two.
The shortest audience duration you can set on Google and Facebook is one day (i.e. this will include people active on your website in the last 24 hours). If you have more than 100 website visitors per day that’s going to be your key audience for advertising purposes.
You can still have a 30 day audience, or a 180 day audience, or whatever. But don’t spend as much money on it. Focus your spend on your most recently active contacts.