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Case Study | Jul 8
Dann Albright on August 17, 2018 (last modified on August 21, 2018) • 12 minute read
There are two heavy hitters in online ads: search and display. (If you were thinking Google and Facebook instead, you’d be right too.)
Display ads are distributed through an ad network and usually include an image or video. (Facebook, Google are the big players here. Twitter, Linkedin Ads and a few others play here too.)
But, which is better?
At first glance, it looks like the response is clear. Over 70% of our respondents, if limited to a single type of ad, would run search ads:
And with the budget that they do have, those marketers run search ads much more often:
It seems like an easy win for search ads, which does account for the largest percentage of ad dollars online, according to data from Forrester Research.
But once we started digging into the survey responses, we discovered that the issue isn’t as clear-cut as it might seem. In fact, there are some very good arguments for display ads.
It all comes down to what generates engagement from your prospects. And it depends on many things, from ‘where they are in your funnel’ to their purchase intent (or lack thereof) to ‘what you’re selling’.
The charts make it look straightforward. But planning a successful ad buy is complex. Let’s see what these real-world marketers have to say about their own ads.
Search ads are great for converting customers who are showing intent to buy. Display ads are better for brand awareness. It was the most common refrain we heard from marketers.
Because search ads are displayed to people already looking for a product or service like yours. With display ads, you can’t usually target them to a prospect who is ready to buy. “Usually, display ads are shown to casual website visitors just by virtue of their presence, while search ads only trigger in response to a deliberate search query. By inference, search ads will be seen more often by those with an avowed interest, while display ads are more of a shot in the dark” per Andrew McLoughlin from Colibri Digital Marketing.
Michal Ann Strahilevitz, professor of marketing at University of Wollongong, likened it to being a guest to the party, “It’s generally better to be an invited guest (search) than an uninvited guest (display). We are all nicer to the friend we invite for dinner than we are to the stranger knocking on our door during dinner. However, for some product and service categories, display ads will make a lot more sense because people are unlikely to search for you or your category.” Similarly, Chris Weaver from MWI called it “Push vs Pull Advertising.”
Agency Match‘s Nelson Jordan told us that “We tend to see the highest ROI when we use search ads for the first and final interaction before purchase or conversion. We’ve found that while display ads are great for brand awareness, it’s harder to run a profitable campaign at later stages in the funnel.”
“Display ads are stronger in regards to brand awareness and driving a large volume of traffic. Search ads are great when you want to drive conversions because people have likely already done their research and are ready to make a purchase” says Rachel Bills, lead PPC digital strategist at Intuitive Digital.
She also pointed out that search and display ads should be used together. This was another common thing we heard.
“[I]t’s not really a question of which generates more leads and sales but rather when to use each,” says MODassic Marketing founder Ryan Short. Short also pointed out that sales cycles and price points can affect which ads perform. With very short sales cycles (like those prevalent in consumer e-commerce), you can get lots of value with display ads, he added.
Several marketers said that remarketing is the best use of display ads. Once a potential customer knows about your product or service, a well-placed display ad can remind them of why they wanted to purchase.
You won’t get a ton of traffic with remarketing display ads, says Chris Sansone, web strategist at Contempo Space. By using images of the products that browsers were looking at and limiting the remarketing campaign to 10 days, Contempoand maximizes results and minimizes the number of people who find the ads annoying.
It’s all about reminding people of what they wanted: “Customers have told us that with larger purchases like a bedroom set, they might see something they like and plan to talk to their spouse about the idea. The retargeting ads have served as a reminder later to have that conversation and make the purchase.”
Read our guide on How to Build Facebook Audiences for Remarketing.
Sansone also noted that Google Shopping ads, a sub-type of display ad, has brought even better ROI. (Store Coach’s Dave Hermansen is also a big fan of Google and Bing Shopping ads, and says they outperform search and standard display for ecommerce.)
Combustible founder Julien Raby points out that capturing the attention of a new audience with a relevant ad is hard. Which is why the ROI on “pure display” ads is usually quite low.
With remarketing, Combustible sometimes gets better ROI from display than search ads. But it’s also important to note that Raby and his agency only spend about 10% of their ad budgets on display ads.
Mojalefa Mothudi from Spitfire Inbound shared an interesting way to leverage search ads data to set display ad budgets. In their experience, “search ads generate more leads and more importantly: more customers.” But, when they took on a client who valued both, they changed up their strategy to make it more integrated.
“We decided to dynamically set the budget of our display remarketing campaigns of specific products based on the search demand of the corresponding text ads. In short, campaigns with more search demand get more money for display ads too.”
The results? “This lead to a conversion rate to leads increasing by 36%, while the number of leads that we subsequently managed to close into customers increased by 34%, simply because we used display ad remarketing to nurture the leads into customers.
You need to know where your prospects are in the sales funnel. But you also need to take your industry into account.
Futurety VP of business strategy Sam Underwood points out that search ads are often best for “moment of need” purchases. “Think pizza (I’m hungry), wireless routers (my Netflix is too slow), or car repair (my transmission is making noise),” he says.
Display ads, on the other hand, are “great for products that may need more visual demonstration than a text-only search ad; a home decor item or art event, for example.”
(Underwood also points out that it’s difficult to track the ROI of display ads, as they may cause viewers to go back to your site later. His advice is to watch your organic [and direct] traffic after placing a display ad. You may see it go up.)
Kristan Rivers, co-founder of AdInMo, gives two examples: “Coca Cola can’t sell a can of coke from a clickthrough, nor can Chevrolet sell a car that way.” That may not be 100% true, but you get the point. A picture of a refreshing can of Coke is much more appealing than a text ad telling you about it.
He also made sure to point out that the type of display ad makes a difference. His company places ads in mobile games, and display ads have a significantly better ROI there than text-based ones.
“I would never run display ads over search ads when it comes to lead generation for a software or service based company,” says Akiva Leyton, marketing manager at Falcon Marketing. “On the other hand, with ecommerce, display ads can prove to be much better performing than search ads, as people are naturally visual creatures. They are more likely to purchase something they can visually see.”
Stephen Montagne of NetHustler gave similar examples: “if you want to promote and market something related to finance and insurance, you will do way better with search ads . . . But if you plan on advertising something related to technology or gaming, etc., you can do better on the display network.”
Some industries can take advantage of urgency, as well. “For example, a local air conditioning contractor may not have many visitors coming to their site to read about energy saving tips,” says Wes Marsh, director of digital marketing at DigitalUs.
“However, you can bet a paid search ad that says 24-hour emergency service will certainly get a visitor’s attention when it’s 3 am and they’re sweating bullets after their AC goes out.”
The figures above show that search is generally marketers’ preferred way to advertise. But that doesn’t mean you should go all in on search ads. Some marketers have had great success with smart display ads, too.
“Overall, we have seen search outperform display in driving actual sales,” says Jake Havenridge, senior paid search strategist at SmartBug Media. But, importantly, “display can drive a significant increase in total top-of-the-funnel leads [when combined with an educational offer], which are often captured at a much more economical [cost per lead].”
Driving down that cost per lead can result in great ROI, so don’t dismiss display ads.
And you may find that display just works well for your audience, even if you’re not advertising in ecommerce or similar areas. Tommy Landry, founder of Return On Now, told us about an experience his agency had in running ads for real estate software:
“Initially, we recommended focusing on search, primarily because of past observations supporting it as having a higher ROI. We were absolutely wrong. . . . Display outpaced search by a long margin both in total clicks and conversions, as well as cost per conversion.”
While most of our respondents stressed that search ads are better for marketing to prospects who are “in market” for a product, Raul Tiru from GlobalOwls pointed out that Google’s Display Network now has an “In-Market” Audience capability. “We’ve started with search ads for very specific key words. Then we moved to broader key words. Both did fine but then we tested the “in-market” target group within Google Display Network. Surprisingly, this group costs a lot less and converted better. Google really seems to be great in identifying people willing to buy a specific product. It’s definitely worth experimenting with the ‘in-market’ group within GDN.”
Many marketers stressed that you should test both search and display ads for your company, because they work well in tandem. Driving maximum ROI with a combination of both should be the ultimate goal.
“Technology has evolved the modern user’s purchase and education journey and because of that, accounts that utilize search, display, app, and video marketing normally achieve the most success.” said Ian Revling from Evolve Digital Labs
For example, Folsom Creative president Brandon Kidd usually starts with an 80/20 split between search and display ads. Then he tweaks them from there to get the lowest cost per acquisition (CPA). Even though display ads often cost less, Folsom’s CPA on search ads is usually 35% lower than that on display ads.
(He also recommends using Google Ads extensions to get the most out of your search ads.)
“[W]hen clicks often exceed $100 a piece . . . I really don’t think there’s an excuse not to use display anymore,” says Adam Gingery, digital strategy and paid search manager at Majux Marketing. If you’re in a niche with high cost-per-click, you’ll get more for your dollar with display.
And Gingery points out that display isn’t just great for remarketing—it’s also great for building a remarketing audience. Combined with the low cost per click, display ads provide great value for digital marketers.
Charles Ave Marketing founder Kim Kohatsu brought up a similar point: “In many competitive industries, search CPCs can be so high it makes positive ROI nearly impossible.” And although search ads often bring a higher ROI, she says, the possibility to use varying formats with both image and video “can go a long way in selling a product before a user clicks.”
Of course, it all comes down to metrics and what works for your company.
Monitor your ad data alongside your marketing and sales data using Databox’s pre-built reporting templates.
Brandon Loures, owner of Brandlift Digital Marketing, once spent over $50,000 on a single display ad campaign. And the costs per quality lead were double what he saw on search ads.
As you can see, choosing search or display ads largely comes down to your goals and your target customers. But no matter which you choose, you still need to do it well.
PlanSource‘s content marketing manager Meisha Bochicchio points out that your search ads have to be well-optimized. They key is “properly implementing your search advertising and having a strategy to address multiple stages of the sales funnel.”
She’s also seen display ads work very well with something that a company can give away, like a guide, ebook, or coupon.
What will resonate with your audience? There’s only one way to find out. Start testing, analyze the data, and build on it.
Do you use search or display ads? Or some combination of both? How do you know which will perform better? Share your thoughts in the comments below!
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