How Tracking Pixels Work and How to Use Them

Programmatic Media, Marketing Technologies, How Tracking Pixels Work

Modern digital marketing focuses on how to effectively use audience data in targeting and campaign optimization. New technologies have allowed both digital marketers and agencies to glean more data from campaigns than any previous time.

Marketers do not have to solely rely on impressions, click-throughs and conversions to determine if campaigns are working. Now, they have a lot more data points about:

  • Who the audience is
  • Where they are coming from
  • How they are getting there
  • And what are their audiences’ profiles (i.e. demographics, behaviors, interests, purchasing habits and more).

This data is gathered via first- and third-party tracking pixels. So how do tracking pixels work? A tracking pixel is a piece of code inserted into a custom or third-party creative that makes a server call. Basically, it’s a piece of code that tracks how people get to your site and obtains data like demographics, psychographics and the like.

With this information, marketers can gather a large amount of extremely detailed information about their audiences, which then can be used to granularly optimize campaigns. This ultimately leads to better targeted, more efficient campaigns, which leads to a competitive edge over others in the market.

How Tracking Pixels Work

Tracking pixels are transparent images that are can be placed nearly anywhere, including on websites or embedded in advertisements. When users visit a website or click an ad, the pixel fires. Tracking pixels communicate with the advertiser’s server and provide insightful information about the visitor.

This information is gathered and compared to existing audience data. If the agency or marketer has the capabilities, this data can be used to enhance current audience profiles. In turn, this improves the current database profiles and provides more data points for campaigns. This is done via tracking and matching against the new data, which provides more enhanced targeting.

Why Marketers Shouldn’t Underestimate the Importance of Tracking Pixels

While most people know how to place a tracking pixels, they don’t understand the importance of managing tracking pixels – or even the value of the traffic/audience data that they’re collecting.

Marketers need to be very selective about where they are placing their tracking pixels. This is especially true when it comes to multi-vendor situations like data cooperatives. Many agencies are now getting involved with these. Data co-ops help identify target audiences by using all the data from member organizations. This data is pooled together, and allows the data co-op companies to build in-depth audience models – which in turn help improve campaign efficiencies.

The problem with this is that marketers could negate their agreement with the vendor, but their pixels could still be used in the co-op. Always review vendor agreements, and determine what rights a vendor has to your pixels. The agreement should mention how long a vendor can capture data and termination dates. Also, marketers should remove old tracking pixels on a monthly or quarterly basis.

Why Use a Tag Manager

Tag managers are designed to make marketers’ lives easier since they keep track of all of the active pixels. Marketers can see all their pixels, and add or delete them as necessary. Tag managers also allow marketers to set permissions for vendors, including what type of access they should have. Once a relationship is terminated, marketers can remove a vendor’s permissions.

Marketers need to get smart about the purpose of tracking pixels, how tracking pixels work and how to manage them. The data from tracking pixels is just too valuable to be ignored anymore by marketers.