How to spend $300 on retargeting and earn $5,400?

Hi there,

My name is Alex and I’m a co-founder of Rontar. We recently launched an app for Shopify merchants, helping them start a dynamic retargeting campaign in just a few clicks.

I would like to share with you some recent case studies, and briefly reveal what led to those results. At the same time, I’ll answer some of the most popular questions our customer support team receive from Shopify merchants.

We will take a look at 3 different campaigns that produced completely different results: average, negative and positive. All 3 campaigns were started via our Shopify app. In order to accurately understand the results produced by the ad campaigns, we contacted the online store owners and inquired about the average margin on the products they sell.

Note. For quick navigation between cases, please use the following links:

Campaign #1 (average result)
Campaign #2 (negative result)
Campaign #3 (positive result)

So, let’s go!

 
Campaign #1 (average result)

Client: Online jewelry and bijouterie store, Spain

Spent: $280.67

Revenue: $1,537

Profit (considering 25% margin): $1,537*0.25 - $280.67 = $103.58

Note: As long as the app doesn’t know anything about the margin on the products being sold, the Profit in the app is calculated using the following formula:
Profit = Revenue – Spend.

Result reasons

As a result of my experience of running numerous retargeting campaigns, I’m able to tell if a new campaign will be successful or not before it even starts. Although there are many different factors that influence the success of an ad campaign, only a few are fundamental. I’ll highlight those that positively/negatively affected the results of this particular ad campaign.

Positive factors

Unique products.

The more unique products you sell, the smaller the likelihood of the potential customer finding a particular product in other stores, and the more effective your retargeting campaign will be.

Our client sells jewelry of gold and bijouterie, which is difficult to find in other stores. As a result, the average conversion rate in the store was 1.95%, which meant the campaign ran into a small plus.

Negative factors

Large proportion of low quality traffic.

The more low quality traffic you attract, the less effective retargeting will be. If the visitor initially wasn’t interested in buying, retargeting won’t be able persuade him to buy either. This will lead to a situation where we are making ad impressions on the visitors, and possibly gaining clicks, but orders won’t follow. As a result, the CPC (cost per click) and the CPO (cost per order) will increase.

You can find the distribution of traffic sources for this online store on the screenshot from SimilarWeb below:

As you can see, the share of the highest quality traffic, which is from search engines, is only 8.88%, while 62.19% of visitors come to the website from social networks and other websites (47.74% and 14.45% respectively).

 
Campaign #2 (negative result)

Client: Large online electronics store, Canada

Spent: $523.6

Revenue: $2,869.45

Profit (considering 25% margin): $2,869.45*0.15 - $523.6 = -$93.18

Result reasons (positive factors)

High average check. The average check for this online store is $300, which is the only reason the campaign hasn’t gone into an even greater minus.

Result reasons (negative factors)

Large proportion of low quality traffic.

You can find the distribution of traffic sources for this online store on the screenshot from SimilarWeb below:

As you can see, the share of traffic from search engines is only 14.28%, while 80.31% of the visitors come to the website by typing the URL directly in a browser, or from other websites (48.82% and 31.49% respectively).

High competition and non-unique products.

The store sells electronics that can be bought in thousands of similar stores. This leads to a situation where most clicks driven by the ad campaign don’t end with a purchase.

Using 5 retargeting platforms simultaneously

The higher the number of retargeting platforms being used by a store, the more the attraction of each given visitor will cost. Even though in most cases using 2, or even 3, retargeting providers positively influences an online store’s profits, there is a maximum number of retargeting providers that shouldn’t be exceeded.

Our online electronics store uses 5 different retargeting providers simultaneously, which noticeably worsens the figures of each retargeting campaign being run.

 
Campaign #3 (positive result)

Client: Online youth apparel store, USA

Spent: $317.2

Revenue: $5,407.2

Profit (considering 25% margin): $5,407.2*0.25 - $317.2 = $1,034.6

Result reasons (positive factors)

Large proportion of high quality traffic.

You can find the distribution of traffic sources for this online store on the screenshot from SimilarWeb below:

Please note the share of the highest quality traffic, which is from search engines, is 53.96%.

Low competition among stores.

Our client’s store sells apparel, which is almost impossible to find in other online stores. This means that if a visitor is interested in a particular product, he will be able to buy it in this store only, and nowhere else.

Thanks to this and other positive factors, we managed to take the CTR of the ad campaign to 1.22%, and the CR (conversion rate) to an incredible 3.4%!

Low competition among retargeting platforms.

At the time of starting the retargeting campaign through Rontar, the client was using Facebook retargeting only. Since Rontar mainly uses the Google DoubleClick AdExchange network to show creatives, and not Facebook, the online store not only didn’t lose out by adding a new retargeting platform, but managed to additionally attract a meaningful number of new orders.

 
In conclusion

As you can see, there are lots of factors that influence retargeting effectiveness: quality of traffic on a website, uniqueness of products, the average check in a store, the number of retargeting platforms being used, and many others.

As previously stated, it’s usually possible to determine if an ad campaign will be effective before it even starts. However, the best (and the most accurate) way to tell if retargeting will be right for you is to start a campaign yourself.

In the 2 weeks after the release of our app on the Shopify platform, it was installed by 24 online stores, 19 of which continue to work with us after the trial period. This means retargeting is effective for 8 out of 10 stores on average.

To start a dynamic retargeting campaign, follow this link and install the app.

P.S. If the number of visits to your website is more than 30K a month, drop us a line at support@rontar.com and we’ll apply an additional bonus against your account balance.

P.P.S. If you’re a Shopify Expert/Partner, let me know at alex.velikiy@rontar.com – we have a special offer for you and your clients.

Good sales to all and good luck!