By Seth Crawford
When I first came to WRAL Digital Solutions after nearly five years in digital marketing, one of my first thoughts upon learning of all the services we provide was, “Do people really click on display ads?”
I have run social media, email, and Google AdWords campaigns before and seen success. I’ve even converted myself through these tactics. But I’ve never consciously clicked on a display ad and wondered if anyone actually does.
At first, the statistics around display advertising seemed to confirm my doubts. A successful display advertising campaign returns a clickthrough rate of about .08%. Display advertising on WRAL.com averages about twice that, but even .16% seemed underwhelming at first.
Then I saw it work. And everything changed.
The Psychology of Display Advertising
Alright, before we jump into how display advertising can generate results, I’m going to get really heady on you.
The reticular activating system (RAS) is the brain’s subconscious filter. This bundle of nerves at the base of our brainstem is responsible for combing through the inordinate amount of stimuli and information that bombards us on a daily basis. It makes sure only important stuff gets through to our consciousness.
Some examples of your RAS at work are hearing your name in a loud, crowded room; suddenly noticing the model of car you’re thinking about buying all over the road the day after deciding that’s the kind of car you want; having a conversation with someone about a product or brand you’re interested in and then noticing a display ad for that product the next time you get online.
Our phones may by spying on us, but most likely, you’d previously been targeted to receive that ad. It’s just now that you’re interested in the product it’s promoting, your RAS has opened the gate to your awareness.
Display Advertising in Practice
Let’s talk about those small percentages I referenced earlier. Can .16% really make a difference? Display advertising is usually sold based on a cost per thousand impressions (CPM). CPMs will vary, but somewhere between a $6-$10 CPM for highly targeted ads is probably what you’ll find.
So let’s say you’re a garage door company and want to advertise on WRAL.com. You buy 150,000 impressions/month targeting homeowners between the ages of 30-65 with an average household income of $75K+ whose homes have at least a two-car garage. (Yeah, we can do that!) Your campaign results in a CTR of .16% (remember, this is just the average. If your ad creative is good, it could be twice as high). So .16% of 150,000 impressions is 240 clicks. If you’re like most small businesses, that’s a pretty good slice of your monthly traffic.
In addition to the 240 clicks your campaign garnered, it also produced 70 viewthroughs (this refers to people who saw your ad, didn’t click on it, but later went to your website). So these people may not have wanted to click out of the article they were reading but noticed your ad and then later searched for your business’ name in Google.
So for $1,500, you were able to increase your website traffic by about 300 sessions. Assuming your landing page is properly set up with a clear call to action and an intuitive contact/inquiry form (if you need help with landing pages, we can help you out), these new visitors to your website will have an opportunity to become qualified leads. If one of them converts for a set of two garage doors at the national average of $2,148, you’ve already covered your investment and then some.
A Few Random Things to Know About Display Advertising
I’m already at 600 words. You’re starting to lose steam. Fine. I’ll close with a few bullets.
- Display advertising should almost never be a stand-alone tactic. For the most part, marketers agree that it takes 7-13 touches to deliver a qualified sales lead. Always consider pairing display advertising with other tactics that target folks at different stages of the sales funnel (i.e., Google Ads/social media ads, email marketing, SEO, etc.)
- Display advertising gets you back in front of users who have expressed interest in your product or service in the past but failed to convert. Ninety-seven percent of website visitors do not convert their first time on a site. On average, 8% will come back and convert (form submission, PDF download, purchase). Site retargeting increases the likelihood to 26%.
- Most display ads are pretty non-intrusive, meaning they occupy space on the screen that the user doesn’t necessarily need to look at, like a sidebar. There are, however, more intrusive ad types that can produce CTRs higher than 1%. Take a look at these examples:
So, do people really click on display ads?
Enough to make you money.