Mikkel FriisTable of contents
But behind the impressive figures often lies an uncomfortable truth. Many agencies and businesses end up over-allocating their Meta budget to remarketing because they confuse reported value with actual growth. The question of full-funnel versus remarketing isn’t just about campaign setup; it’s about understanding how much of your turnover is actually generated by your adverts, and how much would have happened naturally.
The illusion of cheap conversion: What is incrementality?
To understand the weakness of a one-sided focus on remarketing, we need to introduce one of the most important concepts in modern digital marketing: incrementality (or incremental lift).
Incrementality is defined as the actual, extraordinary growth generated by a marketing activity. In other words, it refers to the conversions that only took place because the user was exposed to the advert – and which would not have occurred in the absence of that advert.
When a remarketing campaign reports a ROAS of 10, many people mistakenly assume that Meta has generated 10 kroner for every krone invested. But in reality, remarketing targets users who are already familiar with your business. They may have visited your online shop, added an item to their basket or searched specifically for your brand. A large proportion of these users were already so far along in the purchasing process that they would have completed the purchase anyway – whether via a direct search, an organic search result, a newsletter or a branded Google advert.
When Meta exposes these highly engaged users to a remarketing advert and they subsequently make a purchase, Meta takes full credit for the sale within its attribution window (e.g. 7-day click / 1-day view). But in reality, the advert has often merely served as an expensive “last click” on a journey that had already been decided. In other words, you’re paying Meta to show adverts to people who were heading to the checkout anyway. The actual, incremental ROAS is therefore often much lower than what you see in your reports.
Without fire safety knowledge, there is no remarketing pool
The second fundamental weakness of a pure remarketing setup is its reliance on external traffic. Remarketing does not create new demand; it merely taps into the demand that already exists.
If you do not continuously invest in building brand awareness and attracting new, cold audiences to your website (top of the funnel), your remarketing pool will inevitably shrink over time. When new users are not flowing into the top of the funnel, a number of critical issues will quickly arise in the account:
•Increasing frequency: The same few users see your adverts over and over again, leading to ad fatigue.
•Rising CPM and cost-per-click rates: Meta has to work harder to secure impressions within a small, saturated target audience, which makes advertising significantly more expensive.
• Falling CTR (click-through rate): Relevance declines when the target audience has seen the same message too many times.
•Flat volume: Even if your ROAS looks good on paper, you cannot scale your sales because the size of your target audience sets a natural ceiling.
In other words, remarketing can be an excellent foundation for capturing that final percentage of undecided visitors, but it can never act as the growth driver in its own right. If you switch off your top-of-funnel campaigns, it’s like stopping sowing new seeds in the field and expecting to keep harvesting year after year.
Comparison: Full funnel vs. remarketing
To provide a clear overview of how the two approaches differ from one another, we can compare them on a number of strategic parameters:
| Parameter | Remarketing (Funnel) | Full Funnel (The entire funnel / Top-to-bottom) |
| Main purpose | To convert existing interest and hot leads. | To generate new demand, build brand awareness and nurture the target audience. |
| Reported ROAS | Typically very high (often overestimated by the attribution). | Typically lower in terms of direct attribution, but it drives up the overall account ROAS. |
| Incremental value | Often low to moderate (many would have bought it anyway). | Very high (attracts new customers who would otherwise never have made a purchase). |
| Scalability | Very limited (due to the size of the target group). | Almost unlimited (works with broad, diverse target groups). |
| Vulnerability | High (depending on external channels such as SEO, email or organic traffic). | Low (a self-sustaining system that builds its own target audiences). |
| Algorithm optimisation | Difficult for Meta to optimise due to small data sets. | Ideal for Meta, as the algorithm gets plenty of data and scope. |
| POAS (Profit on Ad Spend) | Often disappointing, as a high ROAS does not take into account the product mix and incremental value. | Typically stronger across the account as a whole, as new customers have a higher lifetime value. |
ROAS doesn’t lie – but it doesn’t tell the whole truth either
One of the most widely used management tools in Meta Ads is ROAS (Return on Ad Spend), and it’s easy to see why: it’s simple to calculate and easy to communicate. However, ROAS has a fundamental blind spot, which becomes particularly problematic when used to compare remarketing with full-funnel campaigns.
ROAS measures revenue in relation to advertising expenditure. It says nothing about what is actually earned. Two campaigns can have exactly the same ROAS but vastly different profitability – because they sell products with vastly different gross margins. A remarketing campaign that converts low-margin products at low cost may report a ROAS of 8, whilst in reality the company is making almost no profit on each sale.
This is where the concept of POAS (Profit on Ad Spend) comes into play. Instead of dividing turnover by advertising expenditure, you divide the gross profit (turnover minus cost of goods sold) by the advertising expenditure. The formula is simple:
POAS = Gross profit / Advertising expenditure
A ROAS of 5 could mask a POAS of 1.2 (i.e. almost no profit) or a POAS of 3.5 (i.e. solid profitability), depending on the mark-up on the products sold. Without knowing the POAS, you don’t really know whether your advertising is profitable.
The link between remarketing and incremental value is direct. Imagine a remarketing campaign with an impressive ROAS of 9. At first glance, that looks fantastic. But let’s add two layers to the picture:
1. The products in the campaign have a gross margin of 20 %, which gives a POAS of approximately 1.8 – in other words, far from impressive.
2. Some of these conversions are non-incremental, i.e. the customers would have made the purchase anyway. If we estimate that 40 % of the conversions are non-incremental, the actual incremental POAS falls further.
This is not a hypothetical scenario – it is a situation that many online shops and lead-generation companies find themselves in without realising it, because they base their decisions solely on the ROAS reported in Meta.
From a POAS perspective, the full-funnel strategy often looks far more attractive than the ROAS figures suggest. New customers acquired through top-funnelcampaigns typically have a higher lifetime value than customers “acquired” via remarketing, because they have discovered the brand at an earlier stage in their decision-making process and have not simply converted on the basis of a discount code or a dynamic product banner. Furthermore, conversions from the top of the funnel are, by definition, incremental – these customers would not have found the company without the advert.
This does not mean that ROAS is a useless metric. However, it should be supplemented with POAS and, ideally, with an assessment of incremental value, before being used as the basis for strategic budget decisions. Companies that start managing their campaigns based on POAS rather than ROAS often find that their “best” remarketing campaigns are not nearly as profitable as assumed – and that investing in the top of the funnel suddenly looks far more sensible.
Why the full funnel is often underestimated (and how it should be measured)
The reason why many companies are reluctant to invest in a full-funnel strategy is that they assess top- and mid-funnel campaigns using the same criteria as they do for remarketing. If you assess a cold campaign solely on the basis of direct-attributed ROAS, it will almost always come out on the losing side.
However, top-of-funnel campaigns are not intended to fulfil the same purpose as remarketing. Their success should be measured against other metrics that indicate they are actually driving new, qualified users to your business.
When evaluating top-of-funnel campaigns, we should look at:
1. The proportion of new visitors (New Users): Are new people actually visiting the site, or are we simply reusing existing traffic?
2. Cost per landing page view: How effectively can we attract the attention of cold target audiences?
3. Growth in remarketing pools: Is the number of people in our custom audiences (e.g. video views, Instagram engagement or website visits within 30 days) increasing?
4. Assisted conversion value: How do early-stage campaigns affect total revenue across channels (e.g. as measured in Google Analytics or via an increase in branded searches on Google)?
If you only look at Meta’s own reports, you’ll overlook the fact that cold campaigns are the very foundation that enables your remarketing to work at all.
Mid-funnel: The overlooked link
Many companies make the mistake of running a very binary setup: they have a broad campaign targeting cold audiences, and then they have a remarketing campaign targeting people who have visited the website. They overlook the crucial link in the middle: the mid-funnel (the nurturing phase).
Users who have interacted with your brand just once are rarely ready to buy straight away. They need time to develop their interest and build trust. This is where mid-funnel campaigns act as a bridge. Instead of simply showing them the same product image again, you should use this phase to educate and persuade your target audience.
The most effective way to do this is by presenting:
•Customer case studies and testimonials: Show how others have succeeded with your product or service.
•Detailed product descriptions: Explain the unique selling points (USPs) and how the product solves their specific problem.
•Social proof and reviews: Display your Trustpilot score, expert testimonials or any awards the company has won.
•Comparisons: Make it easy for customers to understand why they should choose you over your competitors.
By nurturing users in the middle of the funnel, you ensure that they are far more likely to make a purchase when they finally reach your actual remarketing campaign – or that they convert directly from the mid-funnel campaign, thereby increasing the overall effectiveness of the account.
How do you strike the right balance?
So the question isn’t whether you should choose either full-funnel or remarketing. It’s about finding the right balance based on your business’s specific situation, budget and maturity.
When does it make the most sense to prioritise remarketing?
•Very limited budgets: If you only have a few thousand kroner a month, there’s rarely enough budget to build and maintain a full sales funnel. In this case, it’s all about picking the low-hanging fruit first.
•Strong organic or branded traffic: If the company already has a huge volume of relevant traffic from SEO, email marketing or PR, Meta can work extremely well as a dedicated remarketing engine that capitalises on this traffic.
•Short-term, time-limited campaigns: For example, during a time-limited clearance sale or on Black Friday, it may make sense to focus heavily on remarketing to convert warm leads as quickly as possible.
When is a full-funnel strategy absolutely essential?
•When you want to scale your business: If your turnover is stagnating and you cannot increase your budget without your ROAS falling drastically, your remarketing has reached saturation point. You need to invest at the top of the funnel.
•In the case of longer decision-making processes (e.g. B2B or high-ticket B2C): The more expensive or complex your product is, the less likely people are to buy it at first glance. A structured sales funnel is essential here.
•Low brand awareness: If nobody is familiar with your brand and you don’t have any significant organic traffic, a pure remarketing campaign will quickly fizzle out, as there are simply no users to target.
Conclusion: Stop buying your own customers
If your Meta account relies primarily on remarketing, you’re building your house on rented land. You’re probably paying Meta for conversions that you would have got anyway, whilst slowly eroding your future customer base.
To achieve healthy, long-term growth, you need to have the courage to invest at the top of the funnel. You must accept that top-funnel campaigns serve a different purpose and should be measured against KPIs other than direct ROAS. When you manage to create a consistent thread from the first cold encounter with your brand, through the trust-building phase in the middle, to the effective conversion at the bottom, you’ll see an account that doesn’t just look good on paper, but one that actually scales your business.
Is your Meta setup geared towards real growth?
At Siite, we often see accounts that have stalled because the budget has, without realising it, been shifted to where the figures look most favourable – without considering whether this actually drives the business forward.
If you’d like an honest and professional assessment of whether your Meta account is suffering from “remarketing blindness”, or whether your budget is allocated optimally in relation to your actual bottlenecks, we offer a no-obligation review of your setup.
Book a no-obligation consultation with Siite – then we’ll look at the figures together and work out where your next area of growth lies.
