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Are Programmatic Display Ads Worth the Investment?

programmatic display ads

Are Programmatic Display Ads Worth the Investment?

Twenty years ago, when display banners were in their infancy, marketers placed ads by going directly through website owners to buy inventory space on their web pages. The ads came in all shapes and sizes, and most generated click-through rates (CTR) ranging between 50 percent and 90 percent. Everyone was eager to click on a banner. Fast-forward to 2018, and you’re lucky if 10 out of every 10,000 people who see a display ad clicks on it. People have become “banner blind” and generally distrust them, so fewer and fewer people click on them. For many business owners, especially smaller merchants, the low CTRs are enough evidence that programmatic display ads are not worth the investment. That, however, would be an incorrect assumption.

Programmatic Display Ads – A Team Player

Consider this interesting statistic from eMarketer – by 2019, an estimated $45.72 billion will be spent on programmatic digital display ads. That’s a pretty hefty investment for something that supposedly doesn’t work. The main reason display ads get a bad rap is the difficulty in connecting conversions/sales directly to them. Most business owners want to see a clear-cut correlation between a click (or view) and a sale. That’s not always possible with display ads since they often reach people much higher up in the purchasing funnel. It could be weeks or even months before an actual conversion takes place, and that typically is through another traffic channel (direct, organic search, AdWords, etc.), which ultimately gets the credit for the sale and/or lead. Think of it like a basketball game; everyone remembers who made the winning shot, but few give any credit to the person making the assist. Just like basketball, however, your marketing strategy should be a team effort with multiple players contributing to the win.

The Benefits of Programmatic Display Ads

Aside from the sales/conversion assists, there are three other reasons why programmatic display ads are worth the investment:

Branding

Converting people from browsers to buyers is generally a process and one that can take some time. If you’re only using one media platform to reach potential customers, you are limiting your exposure and your odds of getting people to take the desired action. It’s estimated that consumers are hit with as many as 10,000 ads per day. That’s a lot of clutter to cut through, but with programmatic display ads, you can keep your brand top-of-mind. People typically need to see an ad a minimum of seven times (Rule of 7) before they take an action, so the more opportunities you have to deliver your brand messaging, the better.

Real-Time Data & Insights

A huge benefit of programmatic display advertising is its ability to deliver insights and data in real time. You don’t have to wait until the end of a campaign to determine its effectiveness. From the moment a campaign launches, you can see where ads are being placed (domains & apps), how ads and keywords are performing and track website engagement. You can also move budgets and impression shares to better-performing tactics, adjust geo-targets and geo-fences – the list goes on and on. And, unlike other types of display advertising, audiences are continually updated to ensure only those who show intent or interest in your services/products are targeted. No more stale, segmented lists with people who may have been interested in your business more than six months ago. With all this data, it’s easy to optimize your campaigns on the fly to increase your CTR and ROI.

Hyper-Targeting

Programmatic display ads have a secret weapon that no other marketing media can match – it’s call geo-fencing. Unlike geo-targeting, which simply defines the geographic area in which your display ads will run, geo-fencing uses digital fences created around specific locations to deliver ads on mobile devices in real time. A fence can be a building, a street or even a body of water. You can use geo-fencing to target audiences that are likely to use or be interested in the products/services being advertised. For example, a local restaurant owner could geo-fence nearby business offices, or the competition, to help increase his/her lunch sales. But here’s where it gets even more interesting. With the addition of conversion tracking, you can see how many of the people who were targeted in those geo-fences physically came into a location – whether they clicked on the ad or not. Try getting that data with Google AdWords, a radio spot or TV ad, it’s just not possible.

Whether you have a small or large marketing budget, it’s always a good idea to include programmatic display banners as part of your marketing mix. They may not always get the credit they deserve for sales/conversions, but they are an essential team player that will help keep your brand front and center.

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