The ONLY Facebook Ads Retargeting Strategy You Need

Retargeting. It's one of the most hype-driven, misunderstood, and—yeah–even controversial strategies in the paid ads world. Whether you've just started dabbling in digital ads or you've been in the trenches scaling brands and building funnels, there’s one thing you’ll quickly notice: retargeting is either massively underestimated or completely overhyped.

Table of Contents

1. Retargeting: Why People Get It Wrong

2. First Party Data vs Third Party Data

3. How Facebook Tracks & Uses Your Data

4. Setting Up Facebook Conversion API & Pixel

5. Retargeting Audiences: What Actually Works

6. How Retargeting Fits Into Real Ad Accounts

7. Budgeting, Exclusions, and Lookalike Strategies

8. Practical Case Study: From Cold to Conversion

9. Pro Tips, Takeaways & Next Steps

Retargeting: Why People Get It Wrong

Retargeting isn’t a magic band-aid for your ad account, but it is one of the highest-ROI strategies out there, if you know how to use it right. Too many people slap together retargeting campaigns and then wonder why nothing sticks:

• “Why aren’t my retargeting audiences converting?”

• “Why is my ROAS all over the place?”

• “Why do I keep getting conflicting numbers in Facebook vs Google Analytics?”

Spoiler Alert: It’s almost always a data problem, not a strategy problem. That means before you even touch campaign settings, you need to understand where Facebook is getting its info—and how to feed it the good stuff.

First Party Data vs Third Party Data

Let’s dig into the one thing most marketers ignore: Data Quality.

What is First Party Data?

First party data = information Facebook collects inside its own ecosystem:

• Facebook Engagements

• Instagram Interactions (likes, comments, shares, DMs)

• Messenger conversations

• Facebook Lead Forms

• WhatsApp conversations

All of these are what I call on-platform actions.

“First party data is everything on platform. On platform means everything on Facebook, Instagram and Messenger… it’s all data that comes from Facebook itself.”

This is the cleanest data you can use. It’s direct, accurate, and 100% matched to real user profiles.

What is Third Party Data?

Third party data comes from outside Facebook—mainly your own website:

• Website pixel events (Views, Add to Cart, Purchases)

• Email lists and customer uploads

• External community/member platforms (like Teachable, Kajabi, Skool, etc.)

But, here’s the catch:

• There’s always timing lag (Facebook can take up to 2 days to hear about a purchase)

• Data loss happens without proper setup

• Matching gets messy unless you help Facebook connect the dots (with things like the Conversion API)

Third party data can be powerful, but only if it’s clean and synced.

How Facebook Tracks & Uses Your Data

When someone clicks your ad, lands on your site, and does something (like add to cart or buy), several things have to happen for that data to come back to Facebook:

1. Facebook Pixel or Conversion API (CAPI) on your website picks up the action.

2. The website sends that event to Facebook’s servers.

3. Facebook tries to match email/phone/other signals to a real profile.

4. The event gets logged in your Ads Manager.

Sounds simple—until you realize:

• If your Pixel or CAPI isn’t set up, nothing gets tracked.

• If your purchase event only gets a 4/10 quality score, you’re flying blind.

• Pixel-only setups are dying as browsers and privacy rules get stricter.

How to Check Your Data Quality (Event Matching Quality)

Inside your Facebook Events Manager, every event (like Purchase, Add to Cart) has an “Event Match Quality” score. It’s literally out of 10.

Quick Steps:

1. Navigate to Events Manager.

2. Open your Data Sources (Pixels).

3. Check the “Event Match Quality” column, especially for Purchases.

Pro Tip:
For purchase events, aim for an 8/10 or higher. That means most (almost 9 out of 10) of your conversions are getting tracked and matched accurately.

“If your purchase event is above 8.7 out of 10, then you know your data quality is good. For 10 purchases, almost 9 are clean and correct.”

Setting Up Facebook Conversion API & Pixel

OK, so how do you make sure your third party data is as clean and reliable as your first party data?

1. Pixel Setup

You’ve probably already installed the Facebook Pixel on your store (Shopify, WooCommerce, custom). But that’s barely enough in 2024.

2. Conversion API (CAPI)

The Conversion API (or CAPI) is a “server to server” connection that feeds Facebook data directly from your backend:

• It links backend actions (actual purchases, opt-ins, memberships) to ad IDs and users.

• It improves match rates by passing more data (email, phone, time, UTM parameters).

• It’s required for high-retargeting performance in a world of iOS17, 3rd party cookies dying, and browsers blocking scripts.

Most modern ad platforms (Shopify, Skool, GoHighLevel, etc.) make setting up CAPI easy. If you use Shopify, you can literally add it in seconds with native or third-party apps.

Why Event Match Quality Matters

A low score = lost money.

• Low score? Your retargeting audience is broken, stale, or full of mismatches.

• High score? You’re reaching exactly the right people—people who already engaged with your funnel.

Tools like Triple Whale, Hyros, and others promise to “plug in the gaps.” But unless your base data (Pixel/CAPI) is sorted, you’re just plugging holes in a sinking bucket.

“If you don’t have server side tracking set up, you will never have the same quality of events as in Google Analytics or in Ad Manager.”

Don’t waste your budget on fancy attribution hacks before fixing the basics.

Retargeting Audiences: What Actually Works

Here’s where most marketers go wrong: they use bad audiences or chase bottom-barrel segments.

Instead, focus on the highest quality audiences:

For First Party Data (On-Platform)

• Instagram Engagers (365 days): Anyone who has interacted with your Instagram in the last year.

• Facebook Engagers (365 days): The same for your Facebook page.

• Lead Form Openers: Facebook lead generation forms, even if they didn’t submit.

• Video Viewers: Especially those who watched 50%+ of your promos or educational content.

• Messenger/DM Interactions: Anyone who’s messaged your page or account.

For Third Party Data (Website Events)

• Website Visitors: Anyone visiting in the last 30 or 180 days.

• Add to Cart: Triggered high intent! They were one step away from buying.

• Initiate Checkout: Entered email, started checkout, but didn’t buy.

• Purchase: For exclusions (don’t pitch an offer to someone who already bought).

“For first party data, use Instagram Engagers for 365 days as well as on Facebook… For third party, use your website, Add to Cart, and Purchase—they’re the highest quality of event match.”

Why These Audiences Matter

Events like Add to Cart, Initiate Checkout, and Purchase force people to enter data (email, sometimes phone)—which means Facebook gets way more signals to match.

The higher the “match quality”, the stronger your retargeting pool.

How Retargeting Fits Into Real Ad Accounts

When you build your funnel, it should look something like this:

• Top of Funnel (TOFU): Broad targeting, interest-based, or lookalike cold audiences. Think intro videos, short product demos, free guides.

• Middle of Funnel (MOFU): Engaged viewers, repeat site visitors. Here you can run stronger offers, testimonials, or value-based content.

• Bottom of Funnel (BOFU): True retargeting. Add to Cart audiences, Initiate Checkout, IG/Facebook Engagers, Lead Form openers.

When you set these up correctly, your bottom-funnel campaigns pick off the “ready to buy” people—WITHOUT wasting budget on cold leads.

“We have top of the funnel content, bottom of the funnel content, and with retargeting… if everything’s set up properly, it gets pushed back properly.”

Budgeting, Exclusions, and Lookalike Strategies

Budgeting for Retargeting

You don’t need to drop massive budgets—start small and consistent:

• $5–$10/€5–€10 per day is enough for most businesses.

• Let it run evergreen: don’t keep pausing and restarting.

Exclusions: Don’t Spam Your Buyers

• Exclude Purchasers: Always exclude people who have bought in the last 30–90 days. If you sell products that get reordered (like skincare or supplements), tailor exclusion windows to purchase frequency.

• Dynamic Offers: For a 30-day supply, retarget 30 days out with “Ready for your next batch?” content.

Building Lookalikes

• Best Source Audiences: Use Add to Cart or Purchase events with high event match quality. These make the strongest lookalike bases, especially when your CAPI is properly set up.

Practical Case Study: From Cold to Conversion

Let me show you exactly what this looks like inside a real ad account.

The Setup

• Client: e-commerce brand selling physical products

• Account structure: TOFU (cold), MOFU (engaged), BOFU (retargeting)

• Dynamic Carousels: Show each visitor the exact products they viewed—and related ones too

In May:

• Ad Spend: Just a bit over $2k

• Campaigns: Cold conversion, lead generation, and dedicated retargeting carousel

• Retargeting Spend: Only $5/day, pulling consistent new orders every day

Results

• Top of Funnel (Lead Gen): Surprisingly, even cold campaigns brought purchases at a 2x ROAS

• Retargeting Carousel: Conversion costs dropped, purchases increased, ROAS hit 7x

• Frequency: Yes, frequency spiked—totally normal in retargeting. You want people to see your offer multiple times, just not 15+ per week.

“…with retargeting… we have a retargeting carousel. As you can see 6 purchases, cost per purchase €18 with ROAS 7. The frequency is way higher—which is normal as well.”

Retargeting Campaign Settings

• Retargeting View Content (VC): Targeted only people who viewed a product (because it's a higher-ticket brand, buying cycles are longer)

• Testing Add to Cart Retargeting: If your brand is more impulse-focused, retarget Add to Cart audiences for the past 30 days

• Exclude Recent Purchasers: To avoid annoying your newest customers

Common Retargeting Questions

Should I use retargeting?

Yes. If you have any traffic at all (site visits, lead forms, IG engagement), a small always-on retargeting campaign will boost your conversions.

What if my pixel/CAPI isn’t set up?

Set it up—now. If you don’t, your audiences will be full of holes. Use platform guides or third-party Shopify/CMS apps to help.

What about Hyros, Triple Whale, or other tracking tools?

They can help, but ONLY if you’ve already maxed out your base setup. If your event match quality sucks, no tool can fix that.

Should I exclude purchases?

Always. Set your exclusion to match your typical reorder or repurchase window.

How do I know if my audience is too small?

If your frequency is spiking over 10 in a week, consider lowering time windows or expanding to broader engagement events.

Blockquote Highlight

“Retargeting is still super undervalued. Not a lot of people are using it… even a €5-a-day campaign will pull in new sales from warm leads consistently.”

Pro Tips, Takeaways & Next Steps

• 1. Nail Your Tracking First: No retargeting strategy works if Facebook can’t see what’s happening. Pixel + CAPI with high event match quality = non-negotiable.

• 2. Use the Right Audiences: Focus on Add to Cart, Initiate Checkout, and high-engagement on-platform signals.

• 3. Exclude Smart: Always exclude recent buyers, matching your product’s purchasing cycle.

• 4. Keep Retargeting Budgets Small: $5/€5 per day is plenty for most small to medium brands.

• 5. Use Dynamic Product Ads: For e-commerce, let Facebook automatically show each person the right product(s).

• 6. Monitor Event Match Quality Monthly: If your quality scores drop, fix it before your ROAS does.

• 7. Layer in Content by Funnel Stage: Map Content (TOFU/MOFU/BOFU) to your retargeting audiences.

• 8. Keep It Evergreen: Don’t pause or reset retargeting unless your business changes dramatically. Consistency builds momentum.

Final Thoughts

Retargeting isn’t about chasing abandoned carts with discounts forever. It’s about creating a clear path, from cold awareness to “take my money” buyers, using the best data at each step.

Whether you’re a coach, course creator, or e-commerce store owner, this is the only retargeting setup you need to scale with confidence. Don’t overcomplicate it—just start with clean tracking, set up basic audience segments, and let Facebook’s algorithm do the rest.

Want Done-For-You Ads or Setup Help?

If you want results like these—or if you just want your tracking and retargeting dialed in once and for all—book a call with me and let’s take your ads to the next level.

And if you found this guide helpful, drop a like, share it, or let me know your retargeting wins and struggles in the comments!

You’ve got the knowledge. Now put it to work—with the only retargeting strategy you’ll ever need on Facebook Ads.