On a Marketing Breakthrough call a few weeks ago, I was speaking with a business owner about online advertising, and I recommended display advertising as a new channel that she had not yet tested.  I knew there were relevant websites online for her business and at the time she was only advertising in search engines like Google.

Her reply caught me off guard because I didn’t realize there was such a misconception about Search vs. Display advertising.  She said, “We don’t have the budget for branding ad campaigns.  We need to focus on lead generation ads.”

I couldn’t agree more with focusing on lead generation vs. branding ads.  But that’s not what I suggested.  Display advertising is NOT just a channel for branding.  No more than TV, radio, billboards, or print ads are only for branding.  All can and should be used for direct response advertising.

I believe the misconception stems partly from to the pricing models.  With many display advertising networks, you’ll pay for impressions rather than clicks.  So unlike search advertising where you’re paying for an actual click (or visitor), you’ll pay for an ad impression (or ad view) on display networks.  That leads people to believe display ads are for brand impressions rather than traffic.

Makes sense until you realize you can easily convert ad impression costs into click costs.  Just divide your total cost by total clicks.  Bingo! Now you’re back to a cost per click model and you can analyze and optimize just like your search campaigns.

Let’s use one of my clients as an example.  And we’ll take this a step further and use YouTube video ads as the example.  I imagine there are plenty of folks who believe YouTube video ads are exclusively for branding on a big budget.  But that’s simply not true.

My client’s goal was to generate webinar subscribers.  This is a classic lead generation campaign where we measured conversions based on the number of actual webinar registrants.

Here are the numbers for the video ad:

  • 8,200 = unique video views
  • $0.24 = cost per view
  • 970 = total clicks (or visitors)

Based on those numbers we can easily calculate our cost per click to be $2.03.  So we were able to generate relevant traffic for $2.03 per visitor.  110 people registered for the webinar so our cost per registrant was $17.89.  Not very good, but this was our first test and we have a lot of room to improve the sales funnel.  Plus, this particular client is selling products priced at $250,000 so 1 sale will easily make this campaign profitable.

My hope is you can see with this example that display ads can be used for direct response campaigns.  Just because you’re paying per impression or per video view, that does not limit your options.  It just creates a little more work for you to calculate the cost per click and cost per conversion.