Twitter announced a mobile retargeting product yesterday. I spoke with Digiday about it and was quoted in their coverage today. My view is that retargeting is an incredibly effective tool for direct response but not one that is really going to move the needle for 99.9% of publishers.
Retargeting is finding the proverbial needle in the marketing haystack. Retargeting essentially tries, via cookies, to find the 1 out of 225,250,000 possible US internet users that has visited a marketer’s site with a message targeted just for them. Obviously this gets amplified by the number of consumers that has visited a marketer’s page and in the case of a business like Criteo or Google, lots of marketers, but there is still a natural limit to the number of potential consumers eligible for retargeting at any given time.
To achieve scale in retargeting an ad tech or media business needs to have high total reach (Yahoo, Facebook, Twitter, Google) and/or be able to access that much reach via exchanges (DSPs, trading desks, some networks), and/or operate a network (Google via GDN, Twitter via Mopub, AOL via Ad.com, Undertone). Therefore having the best chance of seeing the users who are eligible to be retargeted. And do so with enough frequency to encourage a conversion (reach x frequency is the reason why Facebook’s FBX is such a beast).
Retargeting in mobile, as the article states, is trickier due to the nonexistence of cookies. Therefore companies that have a first party relationship with a consumer (usually via a login) AND scale are at an advantage right now. Think Google, Facebook and Twitter.
Back to publishers. The 34th largest publisher in the US as tracked by comScore in October, Fox News, sees about 32 million unique desktop users, or approximately 15% reach. A publisher of this size simply is not large enough to see a very meaningful revenue increase by working with companies to retarget users. Mobile for most publishers is half of their traffic or less. The numbers get even smaller.
Twitter, like Criteo, can certainly build a meaningful retargeting business by aggregating many of these publishers. And they will.
However this does not mean that publishers enjoy meaningful incremental revenue increase by adding retargeting ads (via Twitter or others) to their mobile sites. They should.
The real mobile money for publishers will be made differently.