Cost-Effective Display Advertising and its Positive Impact on Integrated Advertising Campaigns
The Strategic Advantage of Display Advertising
On its face, the primary goal of display advertising is to generate clicks that refer online users to a business landing page or website. To be clear, clicks are an important consideration when evaluating display ad performance and ROI. But limiting your assessment of display ads to only clicks can cause you to overlook other benefits that can affect the cost-to-value ratio of this ad format.
In addition to driving referral traffic, display ads can also be a cost-effective outlet to help you test out audience targeting strategies, improve brand visibility and awareness, and remarket to your existing audiences with new, relevant messaging. The value of display advertising can be even greater when used as part of a larger, integrated ad campaign.
Increase in retention rate for businesses launching omnichannel campaigns vs. businesses focused on a single ad channel
Purchase frequency for integrated campaigns is 250% higher than campaigns run on a single channel
Of marketers are investing in display ads as part of their overarching ad strategies
Top Factors Affecting Display Campaign Cost
The value of display ad campaigns is all relative to cost. Most businesses start out calculating ad performance by dividing total campaign spending by the number of generated clicks. The average cost per click can then be compared to the company’s conversion rate and revenue per conversion to determine the campaign’s ROI.
But this simple calculation overlooks the other factors that can affect the cost of a campaign. Cost can be highly variable depending on the goals of your ad campaign, as well as the size of your advertising budget. Your approach to ad targeting can also affect not only your display ad CPM, but your campaign performance and ROI.
As you evaluate these costs and your ad spending power, consider the following:
- How large is your current website traffic? The less traffic you have coming into your business website, the more value you’re able to create with each display ad click.
- Do you want to target new users or current users? These different audiences are likely best served with different types of messaging. But the cost and CPM can vary: retargeting campaigns typically drive a far higher CPM than campaigns targeted to new prospects.
- How niche is the audience you’re trying to target? If you want to target ads to a narrowly defined audience, you’ll likely face a higher average CPM. On the other hand, if you choose to cast a wide net, you may achieve a lower CPM for your display ads, although the relevance of these ads to their audience will decline.
- What size is the geography you are looking to target? Hyper-local targeting can increase your overall CPM, although the relevance and value of each impression will likely be higher as a result of this targeted approach.
How to Measure Performance With Metrics That Matter
While CPM can be a useful metric to better understand display ad performance, it’s an incomplete data point that doesn’t offer much insight into the full value of your campaign. To truly understand campaign ROI, you need to focus on the metrics that matter for your business.
Those metrics are determined by identifying data points that are aligned with your advertising goals. Accounting for brand visibility and engagement from high-priority audiences, for example, helps your business understand the full impact of your ad spending.
At Cox Media, we help our clients shift their focus away from CPM to focus on these more insightful business metrics. This enhanced view of display ad performance helps us then deliver even better results through a combination of prospecting and retargeted ad delivery. Ready to leverage display ads to get more value from your advertising budget? At Cox Media, we combine programmatic display ad solutions with integrated ad campaigns, maximizing performance for your overall ad strategy.
As advertising strategies continue to take shape, cost control and return on investment weigh heavy on the minds of most business leaders. While digital advertising can play an integral role in generating revenue for businesses large and small, those companies are more determined to make sure their ad spending is creating value and aligned with business goals.
Display advertising can play a critical role in achieving those goals. But business leaders would be wise to learn exactly how display ads can achieve a positive impact for the brand—especially when used as part of a larger, integrated ad campaign.
As the advertising industry has improved its ability to target select audiences and understand the full picture of advertising ROI, our ability to evaluate display ad performance has evolved beyond simply calculating the cost-per-click. Read on to learn more about the role display ads can play in your overall ad strategy—along with tips on how to better understand and evaluate display ad cost and performance.
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