ADOTAS EXCLUSIVE — John and Paul, peanut butter and jelly, man and dog, display and search… one clearly doesn’t belong. Display advertising and search advertising simply don’t often fit together in marketer’s minds.
Today, most online marketers use search (just ask Google) and only some use display. It’s the rare marketer that uses both, particularly in companies that feel like they are too small to have “branding” budgets that are separate from the overall marketing budget. This is in large part because the measurable return-on-investment (ROI) of display ads has been difficult to ascertain, since the goal is not necessarily “clicks” or “conversions.”
However, this doesn’t mean these ads are not having a positive effect. In fact, with the improvement in measurement capabilities, recent research from a number of sources has been published showing the significant value of display campaigns to the overall effectiveness of search and other marketing activities. Based on this research, it’s clear that understanding the lift created in all channels is important to calculating display advertising ROI, and all marketers should consider adding display to their online budgets.
In a report by independent measurement and analysis company comScore released in November 2008 called “Whither the Click,” researchers examined 139 online display advertising campaigns ranging across multiple industries. The results were astonishing in that the research showed that the display advertising campaigns had the following secondary effects:
– Increased visits to the advertiser’s Web site (lift of at least 46% over a four week period)
– The likelihood of consumers conducting a search query using the advertiser’s branded terms (a lift of at least 38% over a four week period)
– Consumers’ likelihood of buying the advertised brand online (an average 27% lift in online sales)
– Consumers’ likelihood of buying at the advertiser’s retail store (an average lift of 17%)
In a separate effort, Specific Media, an online advertising network, released a study in December of 2008 that combined data by comScore and proprietary Specific Media Ad Effectiveness data. This study reinforced comScore’s findings and dug deeper into the lift created in search campaigns when a display campaign is run in conjunction. Again, the results speak for themselves, with an average of 155% lift in search activity created by display campaigns over a 12 month period ending August 2008. Specific industry results were as follows:
– Automotive (144% lift)
– CPG (22%)
– Health (265%)
– News & Media (144%)
– Personal finance (206%)
– Property & Real Estate (125%)
– Retail (69%)
– Travel & Tourism (274%)
Yet another study called “Illuminating the Alltel Wireless sales funnel” was conducted by Atlas Institute, Microsoft Advertising’s research division, and concluded that people are 56% more likely to buy a phone or wireless plan from the company when they saw Alltel’s display ads compared to those who only saw Alltel’s search ads. Other Atlas Institute research has proven that “users exposed to both search and display ads convert at a higher rate: an average of 22 percent better than search alone…” Yahoo has also recently espoused this principle and funded research with similar findings.
With all of this research pointing to the same conclusions, it is becoming clear that a display channel can have a profound effect on overall marketing results, but why aren’t more marketers using display? Part of the problem is related to how marketers are measuring the effects of display ads. In the offline world of TV, newspapers and magazines, marketers don’t have the ability to directly measure ROI, so they look at the overall effect on the business: “are our revenues going up enough when we advertise to rationalize the spend?”
In contrast, with display ads it is possible to directly measure clicks and conversions from the clicks, so most marketers assume that the effects end there, and if the ad isn’t producing the same ROI as search, it must not be working. Recent research is showing, however, that this doesn’t tell the whole story, and that the real value of display advertising is to increase the effectiveness of all other channels. Another reason that marketers may not be using display is that they simply don’t have the banner ads. At my company Bizo, a B2B display ad network that focuses on targeting business professionals, we’ve started to produce creative for our smaller clients, which has helped them get a successful start in the world of display. Google, recognizing this trend, has also recently launched a display ad builder.
As marketers begin look at their programs and measure holistically across all channels, they will begin to realize that a display component can deliver positive ROI plus brand building in a way that search alone can’t accomplish. They will begin to create an arsenal of banners in addition to their text ads in order to support and reinforce their other channels. And maybe someday soon, we’ll all think of display and search just like we think of peas and carrots.