I am sometimes frustrated not just at the volume of junk mail that I receive from companies often on very glossy and heavy paper stock, but that in many cases it is coming to me advertising a product I already am a customer of. Being in the ad business, I know that sometimes it makes sense to send a cheaper, untargeted message even if it may annoy/frustrate my existing customers (in some cases it may be helpful to reinforce and remind the user about the brand, other times less useful). But it still irks me when Comcast sends me a pamphlet to sign up for their Quadruple-whatever-service when I already use it.

I do unfortunately notice that a lot of companies do this online as well, showing me expensive retargeted ads for products I already use and of course I’ve read the inevitable articles in places like the New York Times decrying ads that follow users surfing around the web (http://1ad.me/v). It’s a lot easier to control this online than offline – simply drop a piece of code on your page that removes the user from the retargeting segment. Users who are prospects but have not yet turned into customers should be targeted for retargeted ads, but those who have already become paying customers should NOT be retargeted, unless of course there is an upsell opportunity to a higher tier of service.

That’s problem 1 – showing ads to people that already buy your product. And part of the reason for this, I know from one company that has been doing this and who described to me how they set this up, is that companies are still getting great ROI and vendors are making a lot of money while still being lazy about how they set these things up. A client that sees a 3x performance boost versus a traditional campaign will be very happy – but when you show them that if they’d eliminated the wasteful impressions in the campaign they would be at an 8x ROI, they are a little less happy.

Consumers are being drowned in retargeted ads today — vendors are not properly controlling frequency on retargeted campaigns – part of the reason for that is that retargeting campaigns are typically small in size. Let’s say that you have a 200,000 user segment you want to hit every month, you bid a $6 dynamic CPM (ceiling) and end up at a $3.00 CPM rate across ad exchanges – you’re a whopping $600 a month account for one of these vendors…. and they cannot afford to service you for that price hence they pump up the ad volume to $1000-2000 a month. Maybe they charge you on a CPC, maybe something else – or maybe they convince you that their view-based conversion numbers are metrics you should pay attention to (and pay them for!).

Be careful. This is a treacherous path to walk down and is the reason if you browse around having visited your own site you may see a few of your ads but beware if you see too many! It’s impressive to see your ad on a large publisher website, but if you’re seeing it four or five times a day on various sites you might be getting a raw deal.