Are banner ads effective for driving business results? This is an important question to answer. It’s part art and part science. Programmatic advertising today focuses on the importance of data and automation to make smarter ad serving decisions. These conversations will often lead people to beliefs about the business that simply aren’t true. Many people in the business believe that robots are taking over advertising. They aren’t, although there are shifts happening.
Clients large and small often talk about the banner advertising they don’t click on, or the ads they don’t recall as an insightful signal that banner ads really don’t work. These types of “insights” make for topical talking points at conferences and are often discussed by executives talking about influencer marketing, the rise of PR, or the use of video. Usually, there’s an agenda. BrillMedia.co is digital media agnostic. We help clients develop marketing strategies, develop media mixes, and activate media across display, video, mobile, social, native, hyperlocal ads; influencer marketing and social media. We don’t have a horse in the race, but we are – I am – naturally curious, even enthusiastic, about the way that people communicate. We love to know how people communicate interpersonally, how we react to messaging from brands, how ideas permeate societies and how ideas spread across time and the space of the planet reach to become salient.
Digital marketing is a $31.87B business in 2017 according to eMarketer. A friend and former colleague, Steven Kaufman, who works for one of the large advertising agency trading desks, Accuen, and is a certified digital veteran, captures it best: If you think digital advertising is only good for the clicks you are wasting your money and you shouldn’t be advertising, because those clicks, alone, are not worth your media spend in many cases, especially for large advertisers. It’s often difficult to prove the value of digital marketing because of attribution challenges, and because over 99% of the ads that are run are not tied to any specific action. Even further, when asked consumers will share that they don’t recall the ads they’ve seen. I’m here to prove those anecdotal misconceptions wrong. Once proved wrong, you’ll see an important value in the current programmatic ecosystem: that targeting is so granular that ads don’t need to go on being wasted. Between the algorithmic optimization over 40 data partners, over 90k data segments that we use, the targeting is very specific to small audiences.
So, what is happening to the banner ads that are not being recalled? Are they effective? I was alerted to these research studies from the book Pre-Suasion by Robert Cialdini. This book, and its predecessor, Influence, are must reads if you work in marketing.
Evidence 1 – Dynamic Page Content Changes User Preferences
In a study back in the early days of ecommerce, 2001, Mandel and Johnson conducted an experiment to find out how consumers’ behavior changed with different suggestive images. For a furniture ecommerce site some site visitors were shown clouds in the homepage wallpaper, and some were shown green with pennies. The test was to determine whether consumers would be more focused on quality, i.e. clouds as a shorthand for comfort, and pennies, as a shorthand for being price conscious. Users who saw the clouds were more inclined towards higher cost, softer, and (in the consumer’s expectation) more comfortable furniture. People who saw the pennies were more inclined towards less expensive furniture.
Because we are talking about statistically significant data we’re not relying on consumers making the connection that they say a cloud, and thought about buying more expensive furniture.
Evidence 2 – Online Banner Ads Are Not Recalled And Make An Impact
How could this possibly be, and does this prove that banner ads are effective? In a study in 2007 by Xiang, Singh and Ahluwalia users were told to read an article on a webpage while 468×60 banner ads were rotating at five second intervals. The research showed two interesting things. The first is that users didn’t process seeing the ads. They couldn’t recall having seen specific messages from the brands being shown. The second point that’s makes this even more interesting is that when the user was then shown the advertiser’s message they showed more favorable attitudes to the advertiser than users who were not exposed to the message in the test. Finally, the third point which is almost a cherry on top of the cake, is that users who saw the same ad didn’t exhibit a wear-out effect that would result in negative attitudes towards the advertiser for bombarding the user with the same message. In other words, users who didn’t realize they saw the ad were more favorable towards the advertiser after the ad message was delivered.
In the context of statistically significant experiments performed by scientists without an agenda, especially in academic settings, these studies hold weight with me. Banner ads are effective and they do drive business performance.
So, yes, there’s absolutely relevancy with the over 99% of digital ads that are not tied to a conversion. That’s all to say that clicks, video views, conversions and other metrics, whether they are proxies, or they are direct sales, should be strived for. What shouldn’t happen is a dismissal of the effectiveness of banner ads. If the ads are run using smart programmatic targeting, if algorithmic ad decisioning is deployed, if price is setup to pay the best price for the best impression, if proper fraud prevention tactics are deployed, and if the campaign is monitored by adept marketing experts who can optimize effectively then your ad campaign is successful whether a click or conversion is delivered.