Retargeting vs. PPC: Which Strategy Yields Better ROI in 2025?

Your business is getting considerable traction in the market. Visitors are coming in, but there is a problem. It’s always a 3-second visit and no further action. The market is also swarming with competitors; hence, you need valuable leads that will convert. So, you decide to invest in paid ads to gain quick and valuable conversions. However, the overwhelming factor remains the tug-of-war between Pay-Per-Click ads vs. retargeting—which will give you a better ROI?

While both aim to drive traffic and conversions, understanding their differences and effectiveness is crucial for making informed marketing decisions.

Let’s be clear, we aren’t telling you to choose a side (well, not at least now!), but we can help you see the clear differences.

Retargeting has taken the digital ad world by storm. Brands are spending thousands of pounds on retargeting strategies. According to a study by RankTracker, the average conversion rate for retargeting campaigns is 3.8%.

But is it that easy…?

What Is Retargeting and How Does It Work?

Also known as remarketing, retargeting is a digital advertising strategy that targets users who have previously interacted with your website or mobile app but did not complete a desired action. A perfect example is making a purchase or filling out your contact form.

By placing a tracking pixel on your site, you can display tailored ads to these users as they browse other websites or social media platforms, encouraging your visitors to return or convert.

Retargeting is usually executed through:

• Social retargeting: Ads are displayed on platforms like Facebook and Instagram.
• Display ads: Banner ads are shown on websites and apps you are using.
• Email retargeting: Ever got those quirky emails from Amazon about your Wishlist items or abandoned carts? That’s email retargeting.

Now, where does PPC fit into all this?

Understanding Traditional PPC Advertising

PPC involves bidding on keywords to display ads in search engine results or websites. As an advertiser, you are required to pay a fee each time your ad is clicked, hence the term “pay-per-click.”

Pay-per-click advertising strategies are particularly effective for capturing the attention of users actively searching for products or services related to your offerings.

Key platforms of traditional PPC ads include:

• Search ads: Text ads that appear on search engine results pages (SERPs) when users query specific keywords.
• Display ads: The most common one is visual banner ads displayed on websites within the ad network.
• Shopping ads: Product-based ads that showcase images, prices, and merchant information.

Comparing ROI: What’s The Difference Between Retargeting and PPC Ads?

When evaluating the ROI of retargeting and traditional PPC, several factors come into play, including target audience, cost efficiency, user intent, and so on.

We have made it easier for you.

Goal	Retargeting	PPC Campaigns
Target Audience	Users who have previously visited your website or engaged with your brand.	New users who are actively searching for products or services.
Ad Placement	Display networks, social media, and email platforms.	Search engines, display networks, and shopping platforms.
Target	Re-engage and convert interested users.	Attract new visitors and generate conversions.
Cost Per Click (CPC)	Generally lower than traditional PPC.	Often higher, especially in competitive niches.
User Intent	Warm audience – already showed interest.	Cold audience – might be seeing the brand for the first time.
Message Personalisation	Highly tailored based on user behaviour.	Keyword-centric and intent-driven to drive leads.
Performance Tracking	Tracks users across their journey post-initial visit.	Tracks performance from ad click to conversion.

In short, retargeting is highly effective for re-engaging potential customers while traditional PPC is valuable for attracting new prospects and improving brand visibility.

How Retargeting Improves Conversion Rates

Retargeting campaigns enhance conversion rates by:

1. Re-engaging interested users: By reminding users of products or services they browsed, retargeting encourages them to complete their purchase.

2. Multiple touchpoints: Retargeting ensures your brand stays visible across various platforms, reinforcing brand recall and trust.

3. Personalised messaging: Bespoke ads based on user behaviour increase relevance and the likelihood of conversion.

What Are the Benefits of Pay-Per-Click Advertising Strategies?

While retargeting shines in re-engagement, traditional pay-per-click advertising brings its own set of powerful advantages:

1. Captures high-intent traffic: Traditional PPC ads target users actively searching for products or services. These users often have a strong intent to purchase.

2. Precision targeting: With keyword-level targeting, geographic filters, device preferences, scheduling, and more, PPC lets you zero in on exactly who you want to reach.

3. Quick visibility and results: Unlike SEO strategies that take time to build, PPC delivers instant visibility on search engines. Businesses make an average of $2 for every $1 spent on Google Ads.

Top Tips for Maximising ROI in Paid Advertising

Regardless of what you are spending your pounds on; here are some effective ways to optimise your paid advertising efforts:

• Define clear objectives

  Establish specific goals for each campaign, such as increasing website traffic, generating leads, or boosting sales.

• Segment your audiences

  Tailor your messaging to different audience segments based on their behaviour and stage in the buyer’s journey.

• Schedule your ads strategically

  Run ads during peak engagement times for your audience. Use historical data to avoid low-performing hours or days — particularly important in industries with time-sensitive purchasing.

• Focus on high-intent keywords

  Prioritise keywords with the help of SEO experts for clear commercial intent, such as “buy,” “near me,” or “best [product/service]” — to attract users closer to conversion.

• Use tools for enhanced conversion tracking

  Use Google’s enhanced conversions, or integrate with platforms like HubSpot or CRM tools, to track deeper metrics. The goal should not just be clicks, but quality leads and actual sales.

• Align your ads with sales funnel strategies

  Use different messages for top-of-funnel (awareness), mid-funnel (consideration), and bottom-funnel (conversion) users. Don’t serve the same ad to everyone.

• Never forget A/B testing and monitoring

  Continuously test ad creatives, headlines, and calls-to-action to determine what resonates best with your audience. Additionally, review the performance and make data-driven adjustments to your strategies.

• Geo-target your campaigns

  Avoid broad targeting. Narrow your ads to specific locations where your target audience lives or shops, especially if you’re a local service business.

Which Performs Better: Retargeting or PPC?

The performance of retargeting versus traditional PPC depends on your specific marketing goals.

• For higher conversion rates: This is where retargeting works better. It targets users who have already expressed interest in your offerings.
• For brand awareness and new customer acquisition: Traditional PPC excels at reaching a broader audience and driving initial traffic to your site.

An integrated approach that combines both strategies often yields the best results, leveraging the strengths of each to guide users through the sales funnel — from awareness to conversion.

Ready to elevate your digital advertising strategy? Our team at Make Me Local today can guide you through our tailored PPC and retargeting solutions, which can drive measurable results for your business.

Call us on 0800 772 0022 or email us at hello@makemelocal.com today!