Anja Lambrecht†and Catherine Tucker‡ May 6, 2013
We thank Havas Digital and particularly Katrin Ribant for access to data from Artemis and Marco Bertini for facilitating the contact to Havas Digital. We gratefully acknowledge financial support from the London Business School Centre for Marketing. We thank Kristin Diehl, Anindya Ghose, Avi Goldfarb, Brett Gordon, Duncan Simester, Catalina Stefanescu, Florian von Wangenheim and Ken Wilbur for their comments, as well as participants at the 2011 SICS conference and seminar participants at Cass Business School, ESMT, ESSEC, London Business School and the National University of Singapore. † London Business School, London, UK; alambrecht@london.edu. ‡ MIT Sloan School of Management, MIT, Cambridge, MA; cetucker@mit.edu. and NBER
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Electronic copy available at: http://ssrn.com/abstract=1795105
When Does Retargeting Work? Information Specificity in Online Advertising
Abstract Firms can now serve personalized recommendations to consumers who return to their website, based on their earlier browsing history on that website. At the same time, online advertising has greatly advanced in its use of external browsing data across the web to target internet ads. ‘Dynamic Retargeting’ integrates these two advances, by using information from earlier browsing on the firm’s website to improve internet advertising content on external websites. Consumers who previously visited the firm’s website when surfing the wider web, are shown ads that contain images of products they have looked at before on the firm’s own website. To examine whether this is more effective than simply showing generic brand ads, we use data from a field experiment conducted by an online travel firm. We find, surprisingly, that dynamic retargeted ads are on average less effective than their generic equivalent. However, when consumers exhibit browsing behavior such as visiting review