ADOTAS — If you work in the industry, you’re probably already familiar with the problem: The cookie, that tiny bit of code that gave rise to the entire retargeting industry, just can’t be relied on when it comes to mobile.
That’s the bad news for the retargeting industry. The good news is that, according to a new survey, ad exchanges on social media platforms are increasingly filling the gap. And not only do these new exchanges make it possible to retarget in the absence of cookies, they make it possible to retarget on every single device on which you’re using the social platform — whether it’s your desktop computer, phone, tablet — or phablet, for that matter.
Commissioned by Chango and carried out by Digiday, the survey asked 400 agency executives, brand executives, and media buyers a wide range of questions about retargeting in general and about social and mobile in particular. And though ad exchanges on social platforms are a relatively new phenomenon — Facebook’s exchange, FBX, launched less than two years ago — the survey leaves little doubt that the social exchanges are making a big impression.
How big? Some 41 percent of both agency and brand executives now say that the exchanges are “key” to mobile retargeting.
“It’s becoming more and more important because there are starting to be more ways to do paid social than there ever were before,” said Barry Lowenthal, president of The Media Kitchen.
The Chango/Digiday survey backs Lowenthal up: Brands are pouring money into social ad exchanges. The survey found that 67 percent of buyers are now using Facebook’s FBX exchange for retargeting. And while Twitter’s Tailored Audience exchange launched only late last year, the survey found that 38 percent of buyers have already tried it.
Still, if brands are diving into retargeting via ad exchanges on social media, it doesn’t mean everyone is satisfied with the practice, as it currently stands. Simply put, mobile retargeting remains a risk. According to the survey, only eight percent of respondents were “very successful” in meeting their objectives. An additional 29 percent said they were “successful,” while 45 percent said they were “somewhat successful.”
That a mere eight percent were “very successful” is a reflection of the uncertainty about identifying and targeting users on mobile browsers. And yet the lack of total success doesn’t appear to have dampened the enthusiasm of the industry executives, 45 percent of whom said mobile retargeting was a “soon-to-be mature practice.” Another very confident 17 percent believe mobile targeting is already “standard practice,” while 34 percent said the practice is “still experimental.”
While the survey has garnered some attention for its intriguing findings on mobile, it also looked at the retargeting industry more broadly. When it comes to retargeting budgets, the numbers paint a clear picture of the industry’s growth: 68 percent of agencies and 49 percent of brands are moving dollars from traditional display into retargeting. Perhaps an even better sign for the industry: 10 percent of agencies and nine percent of brands now allocate a separate budget for retargeting.
How is all that money being spent? The survey found that 42 percent of brand and agency executives use retargeting to build brand awareness and increase direct revenue, while 56 percent use the practice to find new customers.
What comes next for the industry will likely come down to the big questions still lingering around mobile. Based on the Chango/Digiday survey there’s good reason for optimism. If the ad exchanges on Facebook and Twitter are any indication, social media platforms may turn out to be a big part of the solution to the mobile retargeting dilemma. And if that dilemma goes away, you can get ready for another retargeting boom.
The full report is available for download here.