Hey, Online Display Ads Don't Suck After All!

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Since the dawn of time, advertisers have been worried about the efficacy of online display ads.  This is in part because, in the mid-1990s, they were taught that online display ads had one purpose in life, which was to get people to click on them.

Of course, nothing could have been farther from the truth.  Online search ads are great for clicks, because when people encounter search ads, they’re looking for something to click on.  When people encounter display ads, meanwhile, they’re not looking for something to click on–they’re looking for something to read.

Advertisers have long known that placing ads in front of people is effective even when they don’t click them, which is why (until recently), they’ve shoveled $50-odd billion into newspaper and magazine ads every year, $50 billion into TV ads, and another $10 billion or so into radio and billboard ads.  The myth of the online display-ad click, however, has held fast, and advertisers have thus not really taken advantage of the messaging and branding benefits of them.

But that is finally changing!


In part because people aren’t reading newspapers or listening to radio much anymore.  In part because advertisers and ad agencies are learning more about what display ads can do (disclosure: we sell them).  And in part because new research is showing that display ads are, in fact, effective even when people don’t click on them.

OPA and Comscore recently teamed up on a study of 80 big brand campaigns.  You can see their presentation here.  And here’s what they told Citigroup’s Mark Mahaney on a conference call for clients recently:

On July 2 We Hosted A Call On Measuring Results From Branded Display Advertising – On the Call was Pam Horan, President of the Online Publishers Association (OPA), and Chris Rogers, VP of Media for comScore. The OPA, in conjunction with comScore, published a study on the impact of online brand advertising in the U.S. The study covers 80 ad campaigns from more than 50 brands tracked across 200 of the most trafficked sites on the Web today. (See the presentation here >) Key takeaways from the call: 1) The Click Isn’t Everything – Currently, rich media CTRs average about 0.1%, with entertainment sites having the highest CTRs at 0.17% and Fin. Services having the lowest at 0.06%. Also, 80% of display ad clicks come from less than 20% of the Internet population, indicating that clicks are not necessarily as relevant to brand advertisers. 2) Display Impacts Search 4 Weeks After Exposure – According to comScore’s analysis, there was more than a 50% lift in ‘Net users conducting a query on a brand term one week after exposure to the display ad. After four weeks, the lift was around 38%, which is still significant. Indeed, a month after viewing the ad, 30% of ‘Net users actually visited the advertiser’s site. 3) Branded Display Improves Advertiser Site Engagement – Those who viewed a branded ad in this study spent around 34 minutes per unique visitor on the advertiser’s site, which was a 55% lift in time spent vs. the 22 average minutes per unique when they were not shown the ad. 4) Branded Ad Campaigns Improve eCommerce Spend By An Average Of 7% – When comparing the users who were exposed to the branded ads vs. those not exposed, comScore found a 7% lift in average eCommerce spend per ad site visitor. Specifically, travel spend was 9% higher among exposed users, CPG spend was 14% higher, and consumer electronics was 22% higher. The So-What? Efficacy Of Branded Advertising Is Material – When exposed to branded ads, the impact may not be direct or immediate, but there appears to be strong evidence that users engage better and transact more with brands once they’ve been exposed to them. With new/larger ad formats, and the potential for richer ad formats in sponsored search results, this efficacy should improve.

See The OPA-Comscore Presentation Here >

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