Has online advertising rebounded from the recession? If not, things are definitely picking up. According to the Internet Advertising Bureau and comScore, digital advertising is performing better than last year. What's more? Display advertising is starting strong. The sector hit record revenues in the first quarter of 2010.
Which leaves a question: Have display advertising's woes been unfairly tied to the recession?
It's easy to see why search advertising is so popular online. Many brands focus on search because it has proven ROI — according to the IAB, 62% of all online revenue came from paid search in the first six months of this year. Meanwhile 8% of all internet users account for 85% of clicks on display advertising. Numbers like that often keep advertisers pouring money into search and holding onto dollars that might have gone toward brand advertising online.
But while search advertising may have the most proven business model in online advertising, businesses that ignore other areas and methods of increasing sales online do so at their own peril.
That was a recurring theme at Econsultancy's Masterclass in London yesterday, where Ian Dowds, vice president of Specific Media, put it like this:
"At the top of the funnel, there are a host of big brand advertisers standing like nervous tourists, dipping their toe in the online sea, debating the temperature and then turning and running away every time the water laps above their ankles."
What matters more for online retailers: display advertising or search? It's likely not an either or answer, but it's a question that has been the subject of an ongoing debate in our comments section this week.
I wrote this post after reading an AdAge article that implied search only accounted for 10% of traffic sent to online retail sites. Abby Klaasen wrote:
"Nielsen found the majority of retailers' web traffic (61%, on average)
comes from people going directly to a retail site -- consumers typing,
say, Amazon.com into a browser address bar."
The idea that only 10% of traffic would be driven by search was new to me, and we asked our readers to weigh in with their own experiences. Many were surprised and confused by Nielsen's numbers (and there is a ton of information in those comments for anyone interested in the subject).
I spoke with Kenneth Cassar, Nielsen's VP of industry insights, to get some clarification. And as always, it turns out that context is key with these numbers.
Display advertising is starting to look like the little ad format that could lately. Online advertisers are moving away from click-through rates as a metric for display success, large companies from Google to Yahoo are stepping up their display efforts and now Nielsen has come out with numbers that imply display may be more effective for retailers than search advertising.
According to Nielsen, less than 10% of online retailers' web traffic, on average, comes from search engines. That's good news for display ads. But is it true?
Today marks the 15th anniversary of the display ad. The first banner ads were run on Hotwired.com (the first digital offshoot of Wired magazine) on October 27, 1994. And according to advertisers and marketers at Digiday's DPAC4, display advertising is ready to rise again.
After being battered by search advertising and dwindling click-through rates, display ads are experiencing a resurgence of sorts. At the Digital Publishing and Advertising Conference in New York on Tuesday, speakers on The State of Display II panel were in agreement that display ads are back.
Display ad campaigns have proven to boost brand searches online and even increase sales. But finding the right mix of search and display advertising can be tricky for advertisers. In the case of Travelocity, the popular travel website has moved towards using real-time search data in its display ads.
It seems like a simple enough strategy. The result? A 203% increase in bookings online. How'd they do it?
For a company that has long relied on word of mouth to promote its products — Google has been going crazy with advertising lately. This summer the company launched an old school ad campaign, complete with billboard and print ads, to promote its cloud-based apps business. And now the company is announcing that its "Going Google" billboard campaign will be going global, with more print, online and outdoor ads promoting the Google suite of office products.
Tom Oliveri, director of enterprise marketing at Google, tells The New York Times this will be
“one of the most visible Google has done and the most significant
campaign for the enterprise side.” The company is also looking to hire two big marketing titles.
Is the this notoriously anti-marketing company changing its tune on advertising? Maybe. But not because of changes in the search business.
Yahoo CEO Carol Bartz is tired of the press trying to dictate what Yahoo should and shouldn't do with its business. But the company's new $100 million ad campaign, which was met with much derision from the press when it launched last month, does not appear to be doing well with consumers.
In an interview with The New York Times this week, Bartz explained her views on feedback:
"I have the puppy theory. When the puppy pees on the carpet, you say
something right then because you don’t say six months later, 'Remember
that day, January 12th, when you peed on the carpet?' That doesn’t make
any sense. 'This is what’s on my mind. This is quick feedback.' And
then I’m on to the next thing."
Is it time to admit that Yahoo peed the carpet?
Research for Econsultancy's 2009 Online Advertising Networks Buyer's Guide published this month has shown there is plenty of innovation within the display advertising sector even if there are too many ad networks without a distinct USP fighting for market share.
The IAB released its first mobile ad spend study this week, which shows that the UK market grew by 99.2% year on year, and was worth a total of £28.6m in 2008.
I've been talking to the IAB's head of mobile Jon Mew about the mobile advertising survey...