Nerd Alert: When Does Retargeting Work?

Summary

Podcast Summary: The Marketing Architects - "Nerd Alert: When Does Retargeting Work?"

Release Date: June 12, 2025

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Introduction

In the latest episode of The Marketing Architects, hosts Lana Jasper and Rob Demar delve into the intricacies of retargeting in online advertising. Titled "Nerd Alert: When Does Retargeting Work?", this episode dissects academic research to uncover the effectiveness of personalized retargeting strategies compared to generic advertising. The discussion is anchored around a study by Anya Lambrett and Katherine Tucker, titled "When Does Retargeting Work? Information Specificity in Online Advertising."

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Setting the Scene: The Retargeting Dilemma

The episode opens with Rob and Lana exchanging light-hearted banter about their "nerdiness," setting a collegial tone. Lana introduces the topic by referencing a common marketing practice:

Lana Jasper [00:43]: "This week I read a study titled When Does Retargeting Work? Information Specificity in Online Advertising."

Lana prompts Rob with a personal anecdote about excessive retargeting:

Lana Jasper [01:07]: "When was the last time you were retargeted excessively for a product you had already looked at?"

Rob humorously admits to evading retargeting by primarily using ChatGPT and Gemini for searches:

Rob Demar [01:07]: "I do so much of my product searches now on ChatGPT and Gemini, I think I'm off the radar."

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Exploring Personal Experiences with Retargeting

Lana contrasts Rob’s minimal exposure by sharing her own experience with retargeting related to an Achilles injury:

Lana Jasper [02:17]: "I have this wooden block called a Sidekick... I bought it and I've just been retargeted still excessively with ads for this."

This personal story serves to illustrate how retargeting can both be beneficial and intrusive, highlighting the fine line marketers must navigate.

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Introduction to the Study: Dynamic vs. Generic Retargeting

Lana transitions into the core of the episode by summarizing the research study:

Lana Jasper [03:00]: "This paper does something rare in marketing research... Does showing someone an ad for the exact same product they just viewed... increase the chance they'll buy it?"

She explains the concept of dynamic retargeting, where ads are personalized based on prior user interactions, versus generic ads that present broader offers without specific personalization.

Contrary to industry claims that dynamic retargeting performs significantly better, the study's findings were surprising:

Lana Jasper [04:17]: "On average, dynamic retargeted ads were less effective than generic brand ads."

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Analyzing the Counterintuitive Findings

Rob offers a hypothesis on why personalized retargeting might underperform:

Rob Demar [04:17]: "I think everybody will throw out there that our consumers getting creeped out by them... but I also think we just had our own case study of... you're not a buyer anymore."

Lana concurs, linking the concept to ad frequency and diminishing returns with repeated exposure:

Lana Jasper [04:39]: "...if you're hitting the same user a second time, a third time, a fourth time, it has to perform twice as well, three times as well."

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Deep Dive into the Research Methodology

Lana provides a detailed overview of the study's methodology:

Lana Jasper [04:43]: "They partnered with a major travel company and ran a real-world experiment."

Participants were divided into groups exposed to either dynamic retargeted ads or generic ads. The effectiveness was measured based on purchase conversions. Unexpectedly, generic ads outperformed dynamic ones.

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Contextual Factors Influencing Retargeting Effectiveness

The study further revealed that the success of retargeting ads is contingent upon the user's stage in the purchasing journey:

Lana Jasper [06:00]: "When people were early in their process... highly specific ads... might have felt too pushy... but when people had done their research... dynamic ads started to shine."

Visiting a review site like TripAdvisor indicated a user's advanced intent to purchase, making personalized ads more effective. Conversely, early-stage browsers were less receptive to specific ads, which could be perceived as intrusive or irrelevant.

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Practical Implications for Marketers

The conversation shifts to practical strategies for marketers to optimize retargeting efforts:

Rob Demar [07:15]: "It's really about a really good understanding of the funnel and where people are at in the funnel."

Lana suggests two potential approaches:

1. Broad Reach and Mental Availability: If pinpointing the exact moment is challenging, maintaining a consistent presence across broad channels can enhance brand recall.

2. Contextual Advertising: Focusing on situational relevance, such as appearing on travel blogs or destination guides when users are actively engaged in planning.

However, both approaches come with challenges, particularly regarding cost-effectiveness and the risk of overspending without guaranteed returns.

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Balancing Precision and Reach: Risks of Over-Targeting

Rob expresses concerns about the pitfalls of hyper-targeting:

Rob Demar [10:02]: "...if you give marketers a dial to turn, they end up spending a lot of money to turn that dial and they create a lot of waste."

He argues that without precise moment targeting, efforts to hyper-target may lead to inefficiencies, reinforcing the value of broader reach strategies.

Lana echoes these sentiments, emphasizing the complexity of implementing moment-based targeting without incurring disproportionate costs:

Lana Jasper [10:27]: "...even if you figured that out, how expensive is it? You might have just gone through all this pain when you could have paid the same cost and reached like 10 times the audience."

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Supporting Evidence: Lab Study Corroborates Field Findings

To validate the field experiment, the researchers conducted a lab study with controlled scenarios:

Lana Jasper [10:32]: "They split people into two groups... then they showed each group either a generic or dynamic ad and it was the same results."

Both studies consistently found that generic ads were more effective for early-stage thinkers, while dynamic ads resonated with individuals who had defined preferences.

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Key Takeaways and Final Insights

Lana distills the study's conclusions, offering actionable insights:

Lana Jasper [11:28]: "The biggest mistake marketers make is using the right message at the wrong time."

She introduces a metaphor to encapsulate the timing aspect:

Lana Jasper [11:53]: "Think of retargeting like solving a case... Timing makes the reveal stick."

Rob reflects on the evolving nature of marketing strategies, acknowledging that the industry is still grappling with the nuances of moment-based targeting:

Rob Demar [12:14]: "...it becomes another one of those vocabulary words that we get to debate in terms of moment and whether or not it's effective and time will tell."

Ultimately, the episode underscores that retargeting effectiveness is context-dependent, emphasizing the importance of understanding customer intent and journey stages to optimize advertising strategies.

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Conclusion

The "Nerd Alert: When Does Retargeting Work?" episode provides a nuanced examination of retargeting strategies, challenging conventional wisdom with empirical evidence. Lana and Rob effectively translate complex research into practical insights, guiding marketers to refine their approaches based on customer intent and timing. The discussion highlights the delicate balance between personalization and over-targeting, advocating for a strategic, data-driven approach to maximize advertising efficacy.

Notable Quotes:

• Lana Jasper [04:17]: "On average, dynamic retargeted ads were less effective than generic brand ads."

• Rob Demar [07:15]: "It's really about a really good understanding of the funnel and where people are at in the funnel."

• Lana Jasper [11:53]: "Timing makes the reveal stick."

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Transcript

[Rob Demar]

Nerd Alert. Learning is important, right?

[Lana Jasper]

Yes, exactly. What a bunch of nerds.

[Rob Demar]

Nerd alert.

[Lana Jasper]

That's right. Marketing Architects. Hello and welcome to the Marketing Architects, a research first podcast dedicated to answering your toughest marketing questions. I'm Lana Jasper. I run the marketing team here at Marketing Architects, and I'm joined by my co host, Rob Demar is the chief product architect of misfits and machines.

[Rob Demar]

Hello.

[Lana Jasper]

Hello. We're back with your weekly Nerd Alert. Every week, I'll take a deep dive into academic marketing research and translate its complex ideas into simple, understandable language for Rob, and of course, for all of you. Are you ready to nerd out, Rob?

[Rob Demar]

I put an extra scoop of nerd berries on my cereal this morning, so I am full and ready.

[Lana Jasper]

Perfect, let's get into it. As always, we'll link the research we cover in the episode notes. This week I read a study titled When Does Retargeting Work? Information Specificity in Online Advertising. This is by Anya Lambrett and Katherine Tucker. But before I get into things, Rob, let me ask you this. When was the last time you were retargeted excessively for a product you had already looked at? And can you remember what it was?

[Rob Demar]

I actually can't, to be honest with you. I do so much of my product searches now on ChatGPT and Gemini, I think I'm off the radar. I think I'm not being retargeted anymore because I never go to the. I just. I never go to do a standard Google search.

[Lana Jasper]

Well, that wouldn't necessarily change it. Like, if you went to someone's website and bought something, they could pixel you and start retargeting you.

[Rob Demar]

Yeah, we're not going to see it because I don't go there. Where are they going to retarget me? I'm not going to.

[Lana Jasper]

Oh, you don't go on Instagram. You don't go.

[Rob Demar]

Oh, hell no.

[Lana Jasper]

You exist in chatgpt pretty much exclusively.

[Rob Demar]

I live in Chat GPT. I don't go to any of that crap.

[Lana Jasper]

Yeah, you know, it's true, actually. You don't go on Facebook. You don't want to.

[Rob Demar]

I want the. I want the fake world.

[Lana Jasper]

I don't want to be Zoom Chats, Microsoft Outlook and ChatGPT. And ChatGPT.

[Rob Demar]

Yeah, that's it.

[Lana Jasper]

Man, you must be happier than the average individual.

[Rob Demar]

I'm pretty happy because ChatGPT really likes me, too.

[Lana Jasper]

Yeah, exactly. You know, it keeps you happy with me.

[Rob Demar]

I get all that I need, so I'm good. I don't need this retargeting. I'm impossible to retarget too. I'm like Teflon.

[Lana Jasper]

Well, unlike Rob, I am addicted to social media.

[Rob Demar]

And so you give the answer, then what have you been hounded by?

[Lana Jasper]

I could tell you a million things because I.

[Rob Demar]

Give me one.

[Lana Jasper]

One recent thing is I have this right here. I've had an Achilles injury from running and I've been targeted. I've been looking up excessively, like, how do I heal this? Like what magic beans do. I need to consume to get my ankle better in time for triathlons. And I ended up. I bought a lot of stuff, Rob. I bought a ton of stuff. You wouldn't even believe. Like anything they send me. I'm like, let me try it. But I have these, like this wooden block called a Sidekick and you can like change the configurations of it and you kind of balance on it to help improve your Achilles strength. And I already bought it and I've just been retargeted still excessively with ads for this. I'm like, I bought it. I fell for it.

[Rob Demar]

What a waste of money. What a waste of money for that.

[Lana Jasper]

Actually, no, no, I mean for you, it's great. I already bought it.

[Rob Demar]

Like, you just, you just keep hitting a buyer over and over and over.

[Lana Jasper]

Definitely. I already bought it. It worked. I don't need another one. So. Yeah, exactly. Just a waste of money. Well, let's talk about the study. This paper does something rare in marketing research. It asks a painfully practical question and then answers it with a large scale field experiment. The question is simple. Does showing someone an ad for the exact same product they just viewed. This isn't even, just, even purchased, they just viewed online actually increase the chance they'll buy it. So let's set the stage. You've probably experienced this. You browse, say a hotel on a travel website. Maybe you poke around, you look at a few places and then you leave. You didn't book a few hours or days later, you're scrolling another site, There it is, an ad for that exact hotel, plus three similar ones. That's called dynamic retargeting. And on paper, it should work. It's personalized, it's relevant, it's data driven. Some companies claim it performs four to six times better than standard ads. But what this study found was, on average, dynamic retargeted ads were less effective than than generic brand ads. So, Rob, when you hear that personalized retargeting ads underperform generic ads, what's your gut reaction? Why do you think that might be the case.

[Rob Demar]

I think everybody will throw out there that our consumers getting creeped out by them, which could be the case. But I also think we just had our own case study of okay, you bought already and now you're being retargeted that many times over. You're not even a buyer anymore. So I don't know is the overall concept of it like how often do you have to stock someone to buy and once they've bought, are you just going to keep stocking them?

[Lana Jasper]

Agreed. And we talked about something similar to this in an episode recently about over frequency and how if you're hitting the same user a second time, a third time, a fourth time, a fifth time, it has to perform twice as well, three times as well. So I think it's also when you speak about performance, I can see how it'd get harder to get a return from this instead of just hitting somebody new for the first time. But let's talk about how the researchers got to this. They partnered with a major travel company and ran a real world experiment. People who had browsed the company's websites were then shown two types of a generic ad showing a vacation like beach scene with the brand logo and a dynamic ad showing the exact same tilt that person had looked at, along with a few similar ones. And then they tracked which ad led to more purchases. Surprisingly, the generic ad did better. But here's where it gets interesting and important. The team didn't stop at the what they asked why. And it turns out the effectiveness of dynamic ads wasn't static. It depended on one key where the customer was in their journey. When people were early in their process, maybe they're just browsing ideas for vacation they were less likely to respond to highly specific ads. In fact, those ads might have felt too pushy or maybe irrelevant to their mindset. But when people had done their research, specifically when they visited a review site like a TripAdvisor, that's when the dynamic ads started to shine. That visit to a review site turned out to be a signal that the customer had narrowed in their preferences. They were no longer just dreaming about a beach vacation. They were comparing hotels, weighing options, getting ready to book. That's when showing that exact hotel paid off. So the insight here it's not just about dynamic ads. It's how we interpret intent marketers. We often assume that visiting a product page is a high intent signal. But this study suggests it might not be. People browse for all kinds of reasons. Curiosity, boredom, early stage planning a product view doesn't mean they're ready for a hard sell. But something like a review site visit, that's different. That shows their thinking seriously. They're comparing options, reading the fine print, preparing to make a choice. So this subtle shift from vague curiosity to narrow preference is what makes a specific ad work. And then the researchers took it another step further. They looked at what happened when people who had visited a review site were also browsing travel related content like travel blogs or destination guides at the moment they were served the ad. That's when dynamic ads were the most effective. It was like this stack of signals. They've narrowed their preferences, they're actively thinking about travel, and now they see the personalized offer and everything clicked. So, Rob, we talk a lot about message and audience fit, but this study, it shows it's also about that right moment fit. So how do you think marketers can get better at spotting these right time moments to target an ad?

[Rob Demar]

I don't know. I was thinking about this a lot because it's a really interesting study. And when you think about, I mean, it's kind of the magic trick of going, where in the funnel are you catching someone? Right. Because that's, that's really what we're talking about, is just a really good understanding of the funnel and where people are at in the funnel. And then making sure you're not hitting them too hard up front and as they're getting close to their buying moment. How does your message change? I think that's going to really vary by brand. It's going to vary by category, and it's going to vary by how much time does it take for someone to make a buying decision based on the category. Some categories are more impulsive, some are long. Travel is one of those that you don't tend to do impulsively. You tend to research. So, you know, how do you make sure that you're meeting them at the right moment? I think moment marketing, if that's kind of what they're calling it, is almost another really interesting category for marketers to investigate because again, I don't know if anyone has really cracked the code on that.

[Lana Jasper]

I agree. I thought this, and there's a little more to the study. I thought it was so interesting. But thinking about how to practically apply this is not as simple. And it leaves me with two ideas. For someone listening to this, they're like, oh, I want to change my retargeting strategy. First of all, overall, you might be over retargeting. I'd say we'll keep doing the study, but I Feel like there are two solutions in my mind because we all know data is so inaccurate. Like you could maybe subscribe to a solution, try to figure out how to target these exact moments. But depending on what you're saying, you category, this is all going to change. Yeah, looking at a review site when you're for travel, that's such a very specific use case and not everybody has that in their head. What's the equivalent of that for my brand? So option one, this is probably why broad reach and mental availability work. Well, if you can't figure out the moment, be ever present, right? Like just be around in general as much as you can through broad reach mediums. Or number two, maybe there's something here with contextual advertising where you're not relying on third party data, but you're thinking about like, what would be those moments where someone is getting really close to making a purchase in my category? Like, where are they probably nearing that final purchase and how could I show up in that situation to be contextually relevant to them?

[Rob Demar]

I think it's a super important conversation, but it makes me nervous because anytime you give marketers a dial to turn, they end up spending a lot of money to turn that dial and they create a lot of waste if someone starts to really hawk. You know, we figured out moment marketing. It's like hyper targeting. You start to run into the same issues and you go, why are you really gaining at the end of the day versus your point of just, you know, a broader reach is going to give you a better result anyways because you're not paying as much.

[Lana Jasper]

Yeah, that's why I'm trying to think of ways around it because it's sort of the same problem with hyper targeting. It's like, all right, well now I figured out, quote unquote, exactly how to target the right buyer at the right time with the right message. All right, say you even figured that out, which I would doubt. How expensive is it? Because unfortunately you might have just gone through all this pain when you could have paid the same cost and reached like 10 times the audience. But hey, figuring it out, I mean, I get how that feels good.

[Rob Demar]

And you got a whole bunch of secondary audiences to boot, you know, so it's like, yeah, like, I'm with you.

[Lana Jasper]

Well, I've got just a little bit more of this study to make sure this wasn't just a fluke of a field experiment. The authors also ran a lab study which I thought was kind of interesting. They split people into two groups. One imagined they were early in Their planning of, say, like I want a beach vacation. The other imagined they had specific preferences, AKA like I want a beach hotel in Hawaii with a pool. Sounds so nice. Then they showed each group either a generic or dynamic ad and it was the same results. Generic ads worked better for early stage thinkers. Dynamic ads worked better for those with well defined preferences. So the takeaway here is strong in both ways they looked at this. Don't assume that personalization is always better. It depends on whether the customer is ready to process and act on that level of detail. The biggest mistake marketers make is using the right message at the wrong time. Dynamic retargeting isn't broken, but it's often misused. And if your customer isn't ready, if they're still figuring out what they want, then pushing specific products just doesn't land and is probably a waste of money.

[Rob Demar]

So.

[Lana Jasper]

So smartest advertisers aren't just targeting people based on what they've seen. They're waiting for the right signal that the person is ready to decide. Now for our RobGPT think of retargeting like solving a case. You don't show your suspect the final piece of evidence until you followed the clues. A dynamic ad is the big reveal, but if you show it before the story makes sense to them, it just feels confusing. Timing makes the reveal stick. That's a new metaphor.

[Rob Demar]

It is. Good job. Good job. ChatGPT. That's a fresh one. Getting smarter. I think it's that 4.1 model they just released getting crapped here. No, I think that this was a really good one. This is really interesting. And again, I think it becomes another one of those, like, vocabulary words that we get to debate in terms of moment and whether or not it's effective and time will tell.

[Lana Jasper]

Yeah, it's another reminder too. With most marketing things. The conclusion from that study is not retargeting sucks. It depends. Everything depends. That's the ultimate answer. Everything depends for everything in marketing, but kind of interested in providing, you should consider nonetheless. That's it for this episode of the Marketing Architects. We'd like to thank Taylor Delos Reyes for producing the show. You can connect with us on LinkedIn and if you like the podcast, please leave us a review. Now go forth and build great marketing Marketing Architects.