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Online Display Ads: Is CTR Everything?

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Online Display Ads: Is CTR Everything?

The measurement of Click through Rate or CTR has always been the most powerful metric in the domain of online ads. Back in the early 1990s, the CTR of display ads was as high as 44%! With time and other factors, this percentage dwindled to about 0.1% in the early 2010s! Does this mean that online ads have become less effective?

Consider this scenario. Most web pages have display ads glaring down at users. How many of them are actually clicked? Look at the way you use the internet yourself. You see these ads and you click on the links you want to, completely ignoring the ads. The same holds true for almost every other online user.

There is a subtext to this scenario that online advertisers have to understand. It may be that the ads are not getting clicks because the wrong target group is seeing them. For example, if a user is a student, working at the side to pay for college, and you display the ad for a luxury car on their computer screen, what chance does the ad have of being clicked? This is exactly the kind of world that advertisers are now waking up to.

CTR has always been the holy grail of display ads. In this digital age, you have to consider other metrics to understand the success or otherwise of online display ads. It is also quite wrong to assume that because an ad was not clicked, it was not noticed! Most users today shy away from clicking on ads because they fear malware. It may well be that the user has taken in the information on the ad and searched for it elsewhere. It is not just CTR, therefore, that attaches value to the ad.

If the display ad reaches the right consumer, with the right set of mind to be interested in what is displayed in the ad, the information is registered and the message hits home. Clicks may not come up but the user remembers the info on display. Advertisers are now looking at a broader context as a metric: performance of the ad in driving sales or online leads. It is not just about clicking anymore.

Studies conducted on online buying trends have some interesting insights to show:

  • Ads are more likely to be successful in clicks when the user has already made up their mind to make a purchase. This is a stage that is deeper into the marketing funnel. At this stage, the user has more or less decided on what to do. The ad simply triggers the impulse to buy. At the earlier stages of the marketing funnel, ads are not that successful in bringing about clicks. Online advertisers should take this insight into consideration and design ad messages accordingly.
  • Relevancy of the ad plays a crucial role in how the ads are received by the users, as I pointed out earlier. The wrong ad to the wrong consumer is a waste of resource. On the other hand, a display ad to the right consumer group has a 40% chance of bagging a click. It need not always be about the user’s previous online surfing history. It can also be about what the user is doing at the particular time. For example, an ad of training shoes for a blog on how to stay fit. If the user is reading up on it, they are more likely to click for training shoes.
  • Back up your SEO to support online display ads. A study says that 53% of users check up search engines for information about products displayed on the ad, another point I mentioned earlier. Users may not click on the ad, but quickly check up Google to find out more about the information that they read on the ad. It can also be that the user comes back to the ad to click on it after reading through the info they find on the search engines.

Display ads are here to stay! If CTR is not giving you the insight you need, you should change your metrics. After all, your ultimate aim is to sell products and services, not gloat over a higher CTR!

Debajyoti Banerjee is the Founder, Director & CEO of Seven Boats - A leading digital marketing agency & digital marketing training institute in India since 2011. He is a Google & LinkedIn Certified Digital Marketer & Trainer, Brand Strategist, Consultant & Entrepreneur. Debajyoti has 17+ years of domain expertise & successful track records in Digital Marketing & emerging technologies. Learn more Schedule an appointment with Debajyoti Banerjee

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