Four Ways to Improve Display Advertising

To understand how the digital advertising industry can attract more dollars, it’s important to take a look at its history and evolution. Despite the many innovations that have occurred over the past decade, we are still experiencing the negative repercussions of some missteps from the early days. The following are four key issues that have inhibited the development of the medium to date, and why there’s reason to be quite optimistic about its future

#1 Ad Clutter
The Problem: Since the early days of the Internet as an advertising medium, banner ads have been emblazoned all over web pages wherever the site could squeeze them in. The conventional wisdom for publishers was simply that more ads equaled more dollars. Over time, the industry has learned that very often more ads per page equaled significantly less impact. Good advertising is about telling a story and by cluttering a web page with several competing messages, there is simply no way to effectively engage with the average consumer. Can you imagine if TV ads featured 4 or 5 different advertisers on the screen at the same time? That would never fly…

Reason for Hope: We’ve been observing the long term trends in ad clutter and we’re beginning to see these numbers decline, which suggests that advertisers and publishers may be beginning to realize that less can be more.

#2 Poor Creative Quality
The Problem: Historically, online creative has been the stepchild of its TV and print counterparts. With more condensed space and a lack of “site, sound and motion,” online ads have traditionally aimed to cram a lot of information into a few square inches of real estate. With such a limited palette, it’s no wonder that the best creative minds in advertising may have been reluctant to conquer this medium.

Reason for Hope: We are seeing a rapid evolution in the quality of online creative today, much of which can be attributed to technical advancements and better integration of the online and offline advertising teams. As broadband penetration continues to increase, sites are more willing to accept bandwidth-hungry, rich media units. We have also seen progress in the form of new creative formats developed by the Online Publishers Assocation, which provide significantly larger real estate for the message, as well as creative ways to deliver it (e.g. the fixed panel unit which remains constant as the user scrolls up or down). For anyone who caught last year’s iPhone takeover ad by Apple on The New York Times Web site homepage, you saw this creative revolution first-hand and it will only get more interesting and compelling with time. And, finally, we are seeing an explosion in the use of video ads, which deliver an ad message with all the richness of TV and which allow full creative expression.

#3 Poor Targeting
The Problem: Another issue that has inhibited effective digital advertising efforts is poor delivery against target consumer segments and inability to reach these consumers with the desired frequency. We’ve conducted numerous post-buy analyses of online ad campaign over the years and frequently find that less than a quarter of campaigns even reach their intended target. Below are several examples of actual campaigns we’ve evaluated illustrating how poorly many campaigns are at actually reaching their targets.

Reason for Hope: Comscore research has shown that better controls for in-country delivery can positively impact the reach and efficiency of a campaign. I suspect that simply raising awareness of the need for this level of control will give us improved performance. And, new techniques for identifying target audiences continue to debut from a variety of players, including Comscore’s Audience Advantage offering. The actual means of targeting an audience can vary dramatically, ranging from search behavior to cookies that reflect offline purchase activity, but the end remains the same. Media buyers and sellers are increasingly being equipped with the ability to improve delivery against their desired audiences.

#4 Wrong Metrics Used for Measuring Campaign Success
The Problem: Even though the pitfalls of using the click as a means of evaluating campaign success (especially branding campaigns) have been well-documented, many in the industry are still having a tough time breaking this addiction. Clicks are easy to measure, which of course makes it tempting to use them for evaluation of a campaign, even if clicks bear little relationship to the actual impact of the campaign on consumers. With click-through rates now averaging around 0.1%, any marketer who focuses on the click is essentially allowing one clicker to represent the branding impact made on the other 999 exposed consumers.

Reason for Hope: We here at Comscore have had the opportunity to directly measure the effectiveness of online advertising on behalf of leading advertisers across a variety of industries with differing goals, ranging from branding lift to online behavior lift (keyword search, site visitation) to offline sales impact. These efforts have proved without a shadow of doubt that online advertising can help advertisers to extend the reach and efficiency of their marketing efforts, so as long as we measure what truly matters.

The good news is that the digital advertising industry has grown despite some of these early missteps. There is significant reason to believe that our industry is moving in the right direction in many ways. By focusing on effective strategy, creative, execution and evaluation, we are ready for digital advertising to fulfill its original promise. As we better demonstrate the value of digital campaigns, we can combat commoditization and boost demand, resulting in an increase in CPMs and a greater share of the overall advertising pie.