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Glossary term

Display advertising

Quick definition

Display advertising includes text- and image-based advertisements that live on websites, apps, or other digital properties.

Key takeaways

Display ads are an effective way to reach a large number of users on the channels they visit most frequently.

Display ads offer the greatest return when used as a second touchpoint after the user has already been exposed to a product or service.

Having an appealing image isn’t enough — display ads also need to have a clear call to action that relates back to the company’s business goals. 

New and developing technologies make it easier to create display ads in house and evaluate how well they work. 


Q: What are the different types of display ads?

A: Display ads are usually either text-based ads, like an ad saying “Click this link” at the top of your Gmail account, or standard banner advertisements, which are rectangle- or square-shaped images that you see on different web pages. Many media sites, like ESPN.com or the New York Times host paid banner ads as a way to support content creation.

Q: How do brands use display ads?

A: Companies use display ads when they want to make new customers aware of their products or services, or inform existing customers of a new product or service. Display ads allow companies to reach users where they're spending most of their time, which is now more often on their smartphone or computer, as opposed to traditional media formats.

While customers are browsing a website or using an app, putting a contextually relevant and engaging display ad next to or within the content they’re viewing can be a way to grab their attention, make them aware of your product, and hopefully influence them to go to your website and take the action that will drive your desired business objective.

Q: How have display ads evolved over time?

A: Display ad formats are constantly changing as bandwidth increases and user’s attention shifts to new devices and types of content. In the early open internet days display ads were pop-ups and full-website takeovers. As browsers removed these capabilities, they moved to the rectangles and squares on the tops and sides of webpages, and then to ads within smartphone apps and mobile-optimized websites.

Q: What is the process of launching a display advertising campaign?

A: A successful display advertising program is an integral part of any marketing campaign. When companies have a new product or idea they want to advertise, they want to make sure they reach all of their current customers across all their different channels to find those new users that are going to sign up for the product. They would build out creatives using their brand images or logos and find technology partners and publishers to place those ads across the various display channels. 

After the ad campaign launches, companies will measure the success of the ad by reviewing the data. Based on the metrics a company has, they will determine whether they need to change the ad, where they run it, or who they are targeting.

Q: How do companies determine which users they want to target?

A: Companies target users based on historical behavior on their site (captured and targeted through onsite analytics solutions) or through data brokers offering second- or third-party data. Successful companies will test a variety of user targetings strategies for each product line, and will have different creative messages and goals based on the product lifecycle and customer. For example, new companies without a lot of people going to their primary website may need to use contextual or modeled data to find new potential customers, whereas an established brand could use a data management platform housing their current customer data to market a new product or feature. 

The other thing that a lot of companies do is remessage or retarget ads to either their current customers or to visitors who maybe haven't completed a purchase.

Q: How do companies determine the time frame for display ads?

A: This is often product and market based. Some companies run are always advertising a key set of products with “evergreen initiatives,” and in these cases their ads are always running as people buy their product throughout the calendar year. 

Advertisers in the retail vertical have very specific timeframes where they want to advertise an initiative, specifically during the pre-holiday period and back to school. Other advertisers focus on a specific product launch. They may have $100,000 to advertise the new product, so they decide to do a week-long blast attempting to serve an ad to everyone they can find online.

Q: How do you offer relevant ads to customers without creating advertising fatigue?

A: Most display ad platforms have controls that allow companies to cap users’ exposure on a per-day, per-hour, or even per-minute level. Additionally, advertising delivery platforms and measurement solutions offer tools to allow companies to analyze their customer’s purchase behavior. This is a great place to start as advertising fatigue can greatly depend on the vertical that you're in and the lifecycle of customers. 

For example, a wireless carrier can go back and reference their audience and ad exposure data to see the history of a customer’s purchase cycle. They may discover a customer segment that upgrades their iPhone not every year, but every three years. It will be more effective to show the iPhone ads to this audience segment every three years instead of every year, or entice them to upgrade a year early. On the other hand, if you’re a fast fashion retailer you will want to rotate your creatives often, but keep your frequency caps higher. 

Companies can also use their advertising platforms to create suppression audiences from customers who have recently converted to ensure they don’t see ads until the next product line is ready.

Q: How can display ads benefit customers?

A: With the correct targeting and context, display advertising can give customers information on new product releases. Display ads can also be inspirational — a user may see an ad and be reminded of an action they want to take or event they are interested in. 

Display ads also show users new features of products. Websites and mobile apps have limited real estate, so display advertising can be a great way to highlight additional benefits or additional colors of a product, or additional ways to access that product. Giving consumers that recall, maybe positioning it in a different way to what is typically shown when you first visit a website, would be a really positive thing for the customer.

Q: How does display advertising connect to a larger marketing strategy?

A: Display advertising is part of a full-funnel marketing program. Usually display advertising works to re-engage consumers. The most successful display advertising programs are often coupled with video and search advertising programs, to allow marketers full coverage for all of a consumers’ digital touchpoints. Display advertising often serves as a secondary touchpoint to give the customer some additional benefits, remind them of an abandoned shopping cart, or inform them of a new product release.

Q: What are the features of an effective display ad?

A: First, you want to ensure you’re targeting the right audience and have the right context. Every display advertising platform has different ways to ensure you’re presenting the right kind of content.

The ad creative itself needs to have a clear call to action. You often see ads that have a slick logo but don’t say what the ad or company is trying to accomplish. Ads also need to conform to the specs and feel of the devices targeted for each advertising campaign.

Q: What technologies are necessary for ad creation?

A: There are a variety of technologies, B2B companies, and agencies that can help a marketer create a display ad. And more of these tools now allow companies to do the ad creation themselves. 

Additionally, there are now platforms that do A/B testing with different colors images and text  combinations over periods of time to programmatically generate the ad with the best response rate.

Q: How can companies keep display ads from appearing on questionable websites?

A: Advertising platforms offer sets of tools for companies to opt into the types and specific websites they want to appear on or block. The most common way is an advertiser blacklist. If you don’t want your ad to run on a certain website, you can put that URL into your ad platform, and it blocks your ads from appearing on the blacklisted site.

Obviously there are sites you would not know about, so ad platforms and industry trade groups have collaborated on other technologies and standards available to ensure advertiser brand safety. The International Advertising Bureau, or IAB, has created what’s called a contextual taxonomy, which classifies all sites using categories like news, sports, education, government, and so on. Advertisers can pick a content category that they want to run against to keep their ads on quality websites.

Q: Do display ads have any limitations?

A: Display ads are one piece of a full-funnel marketing program, and are only going to be available on the channels that offer display ad units. So, as a marketer, if you want to reach every consumer you have to go beyond display. 

Advertisers can also run into what’s called “banner blindness.” Customers can see around 5,000 ads a day, and it can be difficult for a single ad to stand out and make an impact. In some cases, showing too many ads to a user can result in diminishing returns, as users can get sick of seeing the same ad everywhere they go.

To avoid running into issues with overloading a customer, companies can adjust the frequency settings or create suppression sets if customers are seeing an ad too often.

Q: What factors will affect display advertising moving forward?

A: One industry trend impacting display advertising is the role of user consent and browsers tracking protocol updates. Right now, so much of the display advertising industry is based on tracking exposure to actions in websites, and changes to privacy laws will have an impact in the targeting and measurement capabilities of display ads.

There are also new screens and formats that will become available. There are always going to be a new app or website that takes up a lot of people's time and attention, and new formats like virtual and augmented reality will create new spaces for content.

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