Commentary

The Emergence of Display Advertising as a Performance Channel

Online display advertising will become an increasingly important aspect of online marketing. The maturity and competitiveness of the search market mean that most advertisers will find it increasingly difficult to scale their search campaigns efficiently. By contrast, most ROI-focused advertisers have not been tapped into display ads because of the impression-based business models and poor response rates. The tremendous improvements in audience targeting and appurtenant business models have opened up doors to the display medium that have traditionally been closed to them. As part of that movement, retargeting will become standard marketing practice for online marketing. Advertisers will continue to buy traffic to bring users to their site but will now protect that initial investment by retargeting them after they leave.

John Kelly, Vice President, Criteo

2 comments about "The Emergence of Display Advertising as a Performance Channel".
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  1. Tessa Ohlendorf from Online Media Management, September 23, 2011 at 4:04 p.m.


    Hi John,

    This is a eye-catching headline! I've been a media buyer since 2005... and have always used display as a performance channel for my campaigns. I continue to do so.

    There could be a few things clarified:

    - Display media simply refers to the format- banners typically (Rich media, Gif, etc) - not the way it's bought.

    - Display media can be bought on a CPM, CPC, CPV, CPL, CPA or flat rate basis (probably a few other ways I'm leaving out as well).

    I agree with you that there are tremendous improvements being made in targeting and the data-centric approach being taken by a growing number of very smart companies. This certainly gets someone like me excited (I'm a performance based media buyer), but the ups and downs in what media can do online has never stopped changing either.

    What I’m trying to say here is that audience targeting is nothing more than a more sophisticated way of buying the same thing- a targeted audience- via the same channel- display advertising. Same thing for data.

    While we used to call up a content site featuring baby items to message out to moms but now we call up a network and buy the audience in bulk, and follow them around the internet. Both are effective.

    With the sheer volume of people online, and for the length of time they are online for, and because of all the different places online that they now go to (which were previously unavailable) - the hand picking of sites no longer is enough to meet the needs of advertisers. Its a technological evolution that has led us to solutions to meet these needs (data, audience targets) – but rather than being an emergence in the effectiveness of display advertising, it is simply a technological evolution that has enabled advertisers to keep up with the growth of the internet and its uses.

    2) the word performance is a term we should define. Typically, performance refers to sales but this is really not the case anymore.

    Performance these days really depends on the goals of the campaign. Performance could mean any of the following:
    - lead generation- people signing up for example
    - sales, coupon downloads, orders
    - brand interaction and site interaction*

    *Yes – even brand interaction time is called performance these days. Take a Rich Media ad unit that allows people to sign up for a newsletter, download a coupon and play a branded game or video within the unit. In this case the brand interaction time is measured by the tracking and we can quantify the performance of that compared to the email sign ups and coupon downloads.

    If you had written a longer article here I'm sure this would have been clarified! However since you didn't – I really wanted to jump in here – this is a really interesting topic with a lot going on - there have been hundreds of campaigns and millions of dollars spent over the years (to great success!) in which I have used display as a performance channel, and I didn’t want there to be any confusion that it hasn’t been working very well since the birth of the internet.

    Rather than seeing it as an emerging channel, I see audience targeting and data as just another way to buy the same thing- online eyeballs- with the aim of converting them.

  2. John Kelly from Criteo, September 23, 2011 at 6:31 p.m.

    Tessa,

    All good points and subjects for longer discussion. My belief is that we have already seen, and will continue to see, big technological (as well as data) improvements in display advertising. These improvements will enable more and more ROI-focused advertisers to tap into this medium.

    Thanks,

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