We’ve all been there: sitting in front of the computer or scrolling along on your phone and seeing the one-millionth ad of the day. You can often ignore them but sometimes the ads jump out, not because they use bold fonts or bright colors but because you were just thinking about the very same product or service that’s being advertised via PPC.
As the consumer this can feel wild, like the device is inside your head, watching your every move and making note of your every thought. But as a business owner, you should know better.
This is the practice of retargeting ads and it’s a valuable one. No witchcraft of telepathy required.
When you’re paying to advertise your product or service, you want those ads to cut through all the noise and actually reach people who are interested in buying what you’re selling. That’s why you need retargeting.
First, let’s start with a typical series of events without retargeting.
A customer is looking for something similar to what your business provides. They enter some keywords into a search engine and end up on your website. Great news, right? This is a success of SEO and maybe even pay-per-click advertising. Not so quick.
The customer browses around the site, maybe even adds items to their cart or chats with the support, but ultimately leaves without making any purchases.
Without retargeting, this story ends there. So close to making a sale, yet still so far away. It’s frustrating and it can happen over and over again with piles of potential customers slipping through the cracks.
Here’s how the story can end differently, with a happy ending for everyone involved.
The same sequence of events takes place, but in this version, your business practices retargeting.
After the customer leaves your website, they are shown additional ads, often specifically referencing the items or pages they originally viewed on your site. You use the information you gleaned about them to show them just the right ad to make the conversion.
One of these ads catches their attention, so they click on it, come back to the website, and make the purchase, sign up for the email list, fill out a form, whatever the final desired action is. They’re happy, you’re happy; it’s all worked out and the credit goes to retargeting ads.
Although, if you want to tell people it’s all due to your superior business skills and product, we won’t argue.
The simple premise of retargeting is to show potential customers who have expressed some interest in your business highly relevant ads that convert them from potential customers to customers.
This can take a variety of forms so let’s look at some of them and compare.
Pixel marketing is the most common kind of retargeting. And no, it doesn’t mean the ads are blurry and pixelated.
Pixel-based retargeting works by putting a line of code (otherwise known as a pixel) on your website. The pixel then puts an anonymous browser cookie in each of the visitors’ browsers as they come to your website or landing page.
They then leave the site but the pixel allows your ad provider (e.g. Google Ads, Facebook retargeting) to start showing your specific ads to these visitors.
You’ll be able to glean lots of information about visitors to your website through this method and retarget them accordingly. Want to target a visitor who clicked on a specific product page but didn’t follow through to adding to the cart or checking out? You can do it with pixel retargeting.
Sometimes pixel retargeting can come in the form of serving very specific ads showing visitors the exact products they viewed on your site, a practice called dynamic retargeting. It can be beneficial in that potential customers are reminded of the exact thing they were interested in, but some may find it intrusive and disquieting.
List-based retargeting is a more traditional kind of retargeting where you show ads to existing customers or visitors who provided you with some level of personal information like an email address.
You can email these people directly or upload the list to your retargeting platform of choice and have the retargeting campaign address them according to what you already know. It’s a slightly less sophisticated technique but it can still be extremely effective.
The major con with list-based retargeting is that you won’t be able to go after customers who have only minimally engaged with your website, but you can achieve that through other methods.
On-platform retargeting is most used on social media platforms such as YouTube and Facebook. If you post a video on Facebook, you can choose to retarget specifically those who watched the majority of the video.
It’s a different way of gathering information on the potential customer’s interest in your business and can also work well.
Showing users things they’ve expressed an interest in is already how these sites work, so your ads will generally fit right in.
Going back to our little story from earlier, what if the customer targeted in the retargeted ad campaign sees the ads for the business they were interested in and decides they aren’t actually interested at all? Isn’t it all a big waste of time and money?
Simply put, no. And there are a few reasons for that.
Marketing and advertising are always going to be a numbers game. There may be lots of fish in the sea but you’re never going to catch them all, even the ones right near your boat.
What you can do is narrow the holes in the net you’re casting so fewer fish get away. But enough with the fish metaphors.
Let’s put it into hard numbers. If you liked math in school, this will be your favorite part.
Website visitors who have been retargeted with display ads are more likely to convert by a whopping 70%. That’s 7-0 percent. Not good enough for you?
How about the fact that retargeted ads have a click-through rate that is 10X higher than regular display ads?
What about the evidence that retargeting campaigns can produce crazy returns on investment, as was the case with one company, Watchfinder, which achieved a 1,300% ROI over six months?
Of course, every business will see different conversion levels with their retargeting campaigns, but the numbers show they can be incredibly effective. So effective, in fact, that you’d really be silly not to get in on the action.
But if you really want to increase the success of your remarketing campaign, follow these tips:
This may be the most important tip of them all, which is why we’ve put it at the top. Do you hear that? If you’re only going to pay attention to one of these, make it this one!
One of the worst things you can do is to bombard potential customers with too many ads. Customers have expressed frustration and annoyance regarding repetitive ads that seem to follow them around wherever they go online.
Don’t be the creepy business harassing would-be customers. It’s not a good look or a good strategy.
On the other side, use too few impressions and your ads may never breakthrough, even to the interested customers you are specifically going after. Show them enough to keep them thinking about your business but not so many you turn them off of it.
Essentially, you want just the right number of impressions. A Goldilocks amount, if you will. Not too many and not too few.
You may think that just because retargeting goes after customers who have already expressed an interest, that the ads don’t have to be as eye-catching the second (and third and …) time around.
Well, cast that thought from your mind. Lock it out and throw away the key.
Ad design will always be important. It may even be more important in retargeting.
You need to make sure the ads are recognizable and tie directly to your brand. Variety in ad type is also valuable here since customers can find the same ad over and over again much less appealing than a bunch of different ones.
This goes with tip #1 but it deserves its own shoutout. Don’t go after recent customers right after they’ve made a purchase.
If a customer is won over by your ads, decides to buy something, and then is immediately inundated with more ads, it will feel more like a punishment than a friendly suggestion.
An annoyed customer is not likely to become a repeat customer. And if you happen to make the critical error of serving them an ad for the very product they just purchased? Forget it.
You should be conscious of where each potential customer is in the sale funnel and make sure that your retargeting campaigns reflect that.
The value of the retargeting campaign compared to any ordinary ad campaign is that you already have additional information about the potential customers and their interest in your business.
Don’t waste that information by doing nothing with it. Create specific ads and different campaigns depending on what level of interaction the customers have engaged in and what product types they showed interest in.
As with any marketing campaign, a critical component is consistent monitoring and evaluation.
Tracking conversions, whichever conversion you’re aiming for, whether it’s sales, email signups, or views, is a great way to know how your retargeting campaign is going.
If something’s not working right, this is how you can find out and fix it. And if everything’s perfect, well, you’ll want to know that, too, so you can keep doing what works.
Find the right metrics that work for you and track them religiously.
As you may be able to see at this point, retargeting, while very beneficial, isn’t always the simplest strategy to implement. There are lots of different factors and best practices to stay on top of to get the process to pay off the way you hope.
If you want to be sure that you get the full rewards of a retargeting ad campaign, go to the professionals.
At PPC.co, we have a team of marketing experts that will help ensure your first-time visitors don’t stay one-time visitors. We do the heavy lifting on the retargeting front so the potential customers who are most likely to make a purchase are right there, ready to be wowed by your business.
Play your cards right and you’ll have swaths of new customers who keep coming back. That’s the potential for a crazy high return on investment.
Don’t leave money on the table by using a poor performing PPC marketing agency. Start using retargeting by engaging our PPC retargeting service.
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If you’re running an e-commerce or retail business, you already know that visibility is everything. The best product in the world won’t sell if no one sees it. That’s where paid ads for ecommerce comes in.
Done right, they drive traffic, conversions, and repeat customers.
Done wrong, they drain your budget and leave you wondering what went wrong.
Whether you’re spending $500 a month or $50,000, your goal is the same: profitability. Not just clicks, and certainly not just impressions. You want to turn ad dollars into real, predictable revenue.
So how do top-performing e-commerce and retail brands make their paid ads work?
What are they doing that you’re not?
This guide breaks it down step-by-step, so you can start running profitable ads with confidence.
Before you launch a single campaign, you need clarity on your audience and goals. Are you trying to boost first-time sales? Increase average order value? Each objective requires a different strategy and metrics for success.
Don’t fall into the trap of launching ads just to “see what happens.” Paid media works best when it’s part of a bigger strategy. So before you log in to Google Ads or Meta Ads Manager, get specific about what success looks like.
If you want to run profitable paid ads, knowing your numbers is the foundation of your entire strategy. Without a clear understanding of your margins, break-even points, and how much you can afford to spend to acquire a customer, you’re essentially gambling with your ad budget.
And in e-commerce, that can get expensive fast.
Let’s start with the most critical numbers you need to know:
Your break-even ROAS tells you the minimum return you need on your ad spend to not lose money. It’s calculated by dividing 1 by your gross profit margin.
So if your margin is 50 percent, your break-even ROAS is 2.0. That means for every $1 you spend on ads, you need to make $2 in sales just to break even.
For example, let’s say you’re running Facebook Ads and spending $1,000 on a campaign. If your break-even ROAS is 2.0, you need to generate at least $2,000 in revenue to avoid losing money. Anything above that is profit. Anything below that eats into your cash.
Once you know your numbers, you can reverse-engineer your ad strategy instead of throwing money into the void and hoping for results. For instance, if your AOV is low (say $25), you might struggle to profit from ads unless you have a very low COGS or high conversion rates. In that case, you might want to:
On the other hand, if your AOV is $150 and your margins are strong, you have more room to compete in ad auctions, bid more aggressively, and test multiple audiences and creatives without instantly wiping out your profit.
A lot of beginner advertisers focus entirely on immediate return from ads. That’s understandable – but short-sighted. If you’re breaking even or slightly losing on the first sale, that might still be a smart move if you’re building long-term customer relationships.
That’s where Customer Lifetime Value (LTV) comes in. If you know that your average customer places three orders a year, each worth $60, then their LTV is $180. If you spend $40 to acquire that customer with your first ad, but earn $140 more over the next 12 months, that ad was extremely profitable in the long run.
Top e-commerce brands build their paid strategies around LTV-to-CAC ratio – how much they earn over time compared to what they paid to acquire the customer.
A healthy ratio is usually 3:1 or higher. So if you’re spending $50 to acquire a customer, you want to earn at least $150 from that customer over time.
Once you understand your numbers, you can plan your ad spend with precision. You’ll know exactly:
Let’s say you want to make $5,000 in profit this month, and your product has a 50 percent gross margin. That means you need $10,000 in sales. If your target ROAS is 2.5, you can spend up to $4,000 in ad spend to hit that goal. With those numbers in hand, you now have a roadmap for campaign budgeting, not just a shot in the dark.
Every ad platform has strengths. But if you try to use them all at once, you’ll burn through your budget without learning much. Instead, pick one or two that align best with your business model and customer behavior.
If you’re selling visually appealing products like apparel, skincare, or home goods, platforms like Instagram and TikTok can deliver strong returns – especially with the right creative. If you’re focused on high-intent buyers, Google Search and Shopping Ads are goldmines. And if you’re targeting professionals or B2B retail buyers, LinkedIn may offer surprising results.
Test channels strategically. Start with the one that matches where your customers spend their time and scale from there. The best platform for you is the one where your ideal customers are already shopping, scrolling, or searching.
One of the biggest mistakes retailers make is casting too wide a net. You don’t want everyone to see your ad – you want the right people to see it.
On Google, this means targeting high-intent keywords that signal buying behavior. Focus on terms like “buy,” “best,” “free shipping,” or product-specific searches. On Facebook, Instagram, or TikTok, you’ll want to dial in your custom audiences using demographic data, lookalikes, interests, and behavior.
Don’t forget retargeting. Most people won’t buy the first time they visit your site, but retargeting brings them back when they’re ready. Set up ads that follow people who viewed a product, added to cart, or engaged with your brand but didn’t check out.
The more relevant your targeting, the more efficient your spend and the higher your return.
Creative is the make-or-break factor in most e-commerce ad campaigns. You can have perfect targeting and the right product, but if your ad doesn’t grab attention in the first two seconds, it won’t convert.
Your creative needs to do three things quickly:
Use high-quality product photos or videos. Show your product in action. Highlight a clear benefit or solve a specific problem. Incorporate customer reviews or user-generated content to build trust.
For paid social, test multiple creatives at once – video vs. image, UGC vs. branded, short-form vs. long-form – and let performance data guide your iterations. On search platforms like Google, focus on copy that’s compelling and packed with relevant keywords. Test different headlines and descriptions to see what gets the best click-through rate.
Sending paid traffic to your homepage is a rookie mistake. You want every click to land on a page that’s designed to convert. That means fast load times, mobile optimization, and a clear call-to-action.
If you’re promoting a specific product, send users to that product page and not your full catalog. If you’re offering a bundle or a seasonal deal, create a dedicated landing page with copy, visuals, and layout tailored to that offer.
Remove distractions. Reduce friction. Make it stupid-easy for people to buy. The less effort it takes, the more sales you’ll see. And don’t forget to A/B test. Sometimes a simple tweak to your headline or CTA can double your conversion rate overnight.
Once your ads are live, your job isn’t done. In fact, this is where it really begins. You need to monitor performance regularly, looking at more than just the surface-level metrics.
Click-through rate (CTR) tells you how well your ad is capturing attention. Conversion rate shows how well your landing page is sealing the deal. ROAS tells you how profitable your campaign is. And CPA helps you compare efficiency across different products or audiences.
Watch for early indicators of success – or failure.
Treat your campaigns like living systems. Tweak, test, and improve them continuously.
Once you find a winning combination – an ad, offer, and audience that works – it’s time to scale. Increase your budget gradually while keeping an eye on performance. Scaling too fast can tank your results, so go step by step.
Duplicate high-performing campaigns to test new audiences or creatives. Experiment with upsells, bundles, or time-limited offers to increase AOV. Layer in email or SMS marketing to retarget paid traffic and drive repeat sales.
And just as importantly, don’t be afraid to kill underperforming ads. If something isn’t working after a reasonable test period, cut it. Your budget should be flowing to what works – not what you hope will work.
One of the biggest mistakes in paid advertising is chasing one-off sales without thinking about the bigger picture. Winning e-commerce brands think in terms of customer lifetime value.
If your first sale breaks even, that’s fine. (As long as you have a plan to turn that customer into a repeat buyer. ) You can use post-purchase emails, loyalty programs, and retargeting ads to bring people back.
At the end of the day, when you view paid ads as the beginning of a customer relationship – not the end – you unlock real long-term profitability. And at PPC.co, that’s where we want to help you! We offer industry-leading PPC management services for ecommerce and retail brands who want to stop wasting ad spend and start generating real ROI.
Contact us today to learn more!
