The Future Keeps Getting Brighter for Display Advertising

By PPC Hero Ally | @Hanapin | guestblogger

In recent months, I’ve scarcely been able to read an online article or visit an industry news site without a Google banner ad reminding me to “Watch This Space.” Of course, the ad is part of Google’s ongoing and sizeable media blitz launched in the fall of last year to drive awareness – and of course investment – in a channel that has already become a multi-billion dollar business for the giant.

Their investment is anything but surprising, however, as all signs point to ample ongoing growth in spend for this channel. In fact, in the last several weeks, discussion of this very topic has once again been dominating headlines of major marketing publications:

  • “Display Ad Spending Jumped 14.6% in the First Quarter” – Mashable reported on a Kantar Media study that estimates growth of 14.6% in display advertising during Q1 2011. This positions display as a “bright spot” in an ad industry that grew only 4.4% overall during the same quarter.
  • “Display on Trajectory to Surpass Search Ad Spending” – eMarketer released a much talked about study contending that display spending will surpass that of search by 2015. They attribute the trend to growth in online video ad spending paired with strong increases in banners. Perhaps this comes as no surprise, as U.S. advertisers are expected to spend $14.38 billion in search and $12.33 billion in online display during 2011 – an increase of 19.8% and 24.5%, respectively, over 2010.

Meanwhile, RBM has experienced this trend first hand. With the ongoing maturation of audience targeting techniques, ad exchanges, and related technologies, the ROI for online display programs managed for our client partners has grown significantly. This has resulted in greater and greater investment in a channel that once lagged much further behind the performance metrics of SEM.

However, don’t simply take our word for it. Recent headlines also insist that engagement with this channel continues to grow and that the benefits extend well beyond the tangible, immediate conversion:

  • “Google Ad Exec Predicts Engagement Rates for Display Ads Will Increase 50% by 2015” – TechCrunch recapped predictions made by Google’s Vice President of Display Advertising, Neal Mohan, at last week’s “Innovation Days @ Internet Week.” Amongst the highlights: engagement rates across all display ads will increase by 50% as the space becomes less cluttered, more relevant, more engaging and more attractive to users. Interestingly, he also predicts that over 40% of online Americans will name display ads as their favorite ad format – a self-benefiting prophecy.
  • “Display Ads Lift Branding Metrics” – eMarketer, meanwhile, reported on further proof of display advertising’s branding benefits. Research found that there is a 24% lift in likelihood to recommend a product amongst internet users who have been exposed to a display advertisement.

So, in short, as marketers increasingly take advantage of real-time buying and granular targeting, as ads become richer and more dynamic, and as consumers become increasingly reachable via growing channels such as mobile and online video, there is little doubt that display will shatter growth projections and continue to dominate the headlines in the months and years to come.

Heather Razukas is an Account Director at Red Bricks Media, a digital marketing agency that focuses on creating value through SEO, PPC, Web Design & Social Media. Heather has been with RBM since 2007, managing Fortune 1000 client engagements such as Adobe and Sony and building high-performing digital marketing programs.