Marketers have an increasing array of online promotional tools, but banner and display ads are the “old” media of the Internet and produce the second biggest revenue stream behind search. In the past, they were usually static banners positioned somewhere on a web page. Advertisers designed them so web surfers would click on the ads and go to specific sites for purchases or additional information. Click through rates (CTRs) were low then—and are low today—in the 1 to 2 percent range. Nonetheless, properly done these ads can be effec- tive for raising brand awareness and for selling certain types of products.
Since the early days of the web, designers and data experts have experimented with rich media ads. Greater bandwidth and faster Internet speeds allow dynamic formats with video, animation, and audio. Research suggests that interactivity increases brand recall 63 percent more than noninteractive ads. (5)
Nevertheless, there are few hard-and-fast rules for effective online advertising. Again, a combination of creative factors, analytics, and testing appear to be the best routes to success. “Online Ads Not Working for You?” cites a study by Millward Brown showing that creative elements such as consistent branding and calls to action are significant in recall and brand awareness (A5; http://adage.com/digital/article?article_id=139795). In “Making Online Ads Suck Less in 8 Easy Steps,” John Young proposes a rigorous approach of testing different formats and creative executions (A6; http://adage.com/ digitalnext/post?article_id=143368). He advocates evaluation of each banner against alternatives and a disciplined schedule of testing. In direct marketing, this was often called “beat the champ” and the principle is the same: change the offer, the creative, the design, or the color and compare it with the original. As much as is possible, test each element and learn which delivers the best sales.
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Online Ads Not Working for You? Blame the Creative
Latest Dynamic Logic Study Finds Obsession Over Optimization, Placement Is Less Important
Advertisers and agencies constantly tinker with campaign strategies to develop right mix of elements to reach their audiences for maximum effect. As this article explains, among the most challenging questions involve determining how targeting, placement, and creative executions can work together to maximize effectiveness.
There will never be a definitive “right” answer to such questions but the article emphasizes the role of research in getting to the best solutions. Findings of an online research firm suggest that crucial creative elements such as “persistent branding, strong calls to action and even human faces—and not super-targeted or high profile ad placements—make for better ad recall, brand awareness and purchase intent.” Of course, this doesn’t mean that advertisers can ignore the importance of smart, careful targeting— but the traditional imperative of great creative executions is still alive in the online ad world.
As mentioned above, online advertising is increasingly targeted, sometimes with re- sults that some might find not so much personalized as kind of creepy. “The Pants That Stalked Me on the Web” recounts an Advertising Age writer’s experience with his online purchase of a pair of shorts (A7; http://adage.com/digitalnext/post?article_id=145204). He soon noticed that the recommendations he received from Zappos.com were following him around the Internet and appearing on many different websites unrelated to apparel. He suggests that many consumers might find this type of targeting to be intrusive and disturbing.
Search
What’s known as paid search or search engine marketing is still the biggest kid on the block. Advertisers pay search engines to locate ads or links near your search results. Let’s say you have dog and you’re planning a vacation that doesn’t allow your best friend to go along. You might try searching dog boarding, kennels, or pet sitters in your area. At this point, what’s known as “natural search” results will show up ranked according to the search engine’s algorithm that tries to find the most relevant results for your query. If you’re using Google (and more than 70 percent of searchers do), you’ll likely see a list of results and a Google map.
On the top of the page, you’ll see sponsored links that advertisers have bid for and bought through Google’s AdWords service. (Keep in mind that Google is known to fre- quently change up its formulas and the way it positions links on the page and that it is famously secretive about its methodologies.) Advertisers buy certain search terms and pay a cost per click (CPC) based on complex algorithms. These “algos” create a “quality score” that Google defines this way:
It looks at a variety of factors to measure how relevant your keyword is to your ad text and to a user’s search query. . . . Quality Score helps ensure that only the most relevant ads appear to users on Google. (6)
Advertisers who use key words that score well pay less per click and get more desir- able placements of their links on a page. One way to think of Google’s quality score service is a kind of matchmaking for consumers and advertisers. Consumers who are looking for certain goods and services want results that are highly relevant to them. Advertisers, of
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course, want to connect with searchers who want to buy what the advertiser offers. Google watches how successful an advertiser’s ads are based on how frequently searchers click on them and calculates the score accordingly.
The quality score was one of the tactics Google adopted to try to make searches more relevant and satisfying after Google had been criticized for delivering search results that weren’t on target. In fact, Bing, Microsoft’s search engine, launched with advertisements that emphasized Bing’s superior search results.
Companies use search engine optimization (SEO) to improve natural search results and move their links higher on the results page. Optimization involves an understanding of how people search, using words and phrases that drive traffic and testing different content to identify how results might change. Another aspect of SEO is measurement of how many links a site has with other popular sites. The revenue stakes are enormous: in just three months in 2010, Google took in $5.09 billion in advertising revenue, including search and display (A8; http://adage.com/digital/article?article_id=144977).
In a related development, Facebook has partnered with Microsoft to use an individu- al’s social preferences and links as key elements of new algorithms. Google’s Social Search appears to use a similar strategy. These moves again highlight the dynamic and intercon- nected nature of online marketing.