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Effective Methods to Evaluate the Effectiveness of Display Advertising Campaign
Vlad Flaks, CEO @ OWOX
Vlada Malysheva, Creative Writer @ OWOX
Display advertising campaigns have great potential, but proving its effectiveness in monetary terms is much more difficult compared to proving the effectiveness of performance advertising. However, our experience has shown that without comprehensive display campaigns, it isn’t possible to achieve comprehensive marketing goals.
In this article, we tell you about the methods of evaluating display advertising effectiveness and discuss the impact of your findings on your business as a whole. You’ll learn how OWOX BI links ad views to online and offline activities to track a user’s entire journey from the first interaction to purchase.
What is Display Advertising?
Display advertising encompasses the use of visual banners, images, and text-based advertisements that are prominently displayed on websites. These ads stand out from the website's primary content, aiming to catch the viewer's attention. Often, display ads on social media platforms are also considered a part of this category. In contrast, paid advertisements appearing in search engine results fall under search engine marketing (SEM).
The most typical pricing model for display advertising is based on the cost per thousand impressions (CPM), with 'M' denoting the Roman numeral for 1,000. This model charges advertisers based on the number of times their ad is displayed.
Benefits of Display Advertising Campaigns in Marketing
Display advertising in digital marketing really shines for its versatility and effectiveness. It's great for boosting brand visibility and getting those conversions, making it a top pick for businesses looking to stand out online.
Let's look at some of the benefits of display ads campaigns:
- Targeted Audience Reach: Display advertising excels in reaching specific audiences. By using data such as demographics, interests, and online behavior, these ads can be shown to users who are most likely to be interested in your product or service.
- Enhanced Brand Visibility and Awareness: Display ads campaigns, with their visual appeal, are excellent for boosting brand visibility and awareness. They allow for creative expressions like graphics, videos, and interactive elements, which can leave a lasting impression on the viewer.
- Measurable Performance and Analytics: One of the key benefits of display advertising is its measurability. With robust analytics tools, marketers can track various metrics such as impressions, clicks, CTR, and conversions. This data provides valuable insights into the performance of the ads, enabling continuous optimization of campaigns based on real-time feedback and results, leading to improved ROI over time.
- Flexibility and Customization: Display advertising campaigns offers a high level of flexibility and customization. Advertisers can easily adjust their campaigns in response to market trends, audience behaviors, and performance metrics.
- Cross-Device Reach: With the proliferation of various devices, display advertising provides the advantage of reaching audiences regardless of the device they use. Whether on desktops, tablets, or smartphones, display ads can be optimized for different screens and platforms, ensuring consistent messaging and user experience.
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Popular Metrics and KPIs to Measure Display Ads Campaigns
If you're diving into digital marketing, getting the hang of display ad metrics is pretty important for nailing your campaigns. Let's talk about those crucial display advertising metrics and KPIs you need for display advertising.
Think of it as your clear-cut map to tweaking your display ads just right. We're going to walk through these important metrics, giving you the lowdown on how to make smart, data-backed choices.
Let's explore the most commonly used metrics for tracking the performance of display ads:
Advertising Cost is a display ad metric that refers to the total expenditure incurred by an advertiser to create and place advertisements. This cost encompasses a broad range of expenses, including the direct costs of purchasing ad space on various platforms (like online, television, radio, and print media).
The cost metric varies among marketers. Some calculate only the ad spend, which includes the expenses for buying ad space and running the ads, while others also consider internal and overhead business costs, like ad creative production. This broader definition helps in evaluating marketing efficiency ratios.
Cost Per Thousand Impressions (CPM)
CPM, or cost per mille, measures the cost for every thousand impressions of an ad on channels like Twitter or Facebook. Cost Per Thousand Impressions (CPM) is particularly valuable for campaigns focused on increasing brand awareness rather than direct response.
By assessing the CPM, advertisers can understand how much they are paying to expose their brand to large audiences, making it a critical factor in budget allocation and media planning.
Additionally, tracking CPM trends over time can provide insights into market dynamics, such as seasonal fluctuations in ad pricing or changes in audience engagement across different platforms.
Ad impressions are a measure of how many times your display ad is rendered on a user's screen, within a webpage or an app. It's important to note that impressions don't necessarily equate to the ad being seen or noticed by the user.
They are simply a count of ad displays, regardless of user engagement or attention. Ad impressions are fundamental for understanding the reach of your campaign and are often used in calculating other metrics like CPM (Cost Per Mille).
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Clicks and Click-Through Rate (CTR)
Clicks are the actual count of how many times users have clicked on your display ad.
The Click-Through Rate (CTR) is a crucial metric that calculates the percentage of impressions that result in a click. It is determined by dividing the number of clicks by the number of impressions and then multiplying by 100.
A higher CTR indicates that your ad is relevant and appealing to your target audience. CTR can be a strong indicator of ad creative effectiveness and is also used to assess the quality and relevance of the ad.
Cost Per Click (CPC)
Cost Per Click (CPC) is a billing model where you pay for each click on your ad. It's a key metric in PPC advertising campaigns.
The CPC value is influenced by various factors, including the competitiveness of the keywords targeted, the relevance of the ad to the audience, and the overall quality score of the ad as evaluated by the ad platform (like Google Ads or Facebook Ads).
CPC can vary greatly depending on the industry, the target audience, and the advertising platform.
Ad Frequency refers to the average number of times your ad is shown to the same user. It's a critical metric for understanding the exposure of your audience to your campaign. While a higher frequency can reinforce the message, excessive frequency can lead to ad fatigue, where the audience becomes desensitized to the ad, potentially causing annoyance and reducing campaign effectiveness. Striking the right balance in ad frequency is key to maintaining user engagement without over-saturating them.
Conversion Rate is a measure of how effectively your ad prompts users to take a desired action, like making a purchase, signing up for a newsletter, or downloading a brochure. It’s calculated by dividing the number of conversions by the total number of visitors who clicked the ad, then multiplying by 100.
This metric is essential for evaluating and improving the ROI of an ad campaign, as it directly ties ad interactions to desired outcomes. Conversion rate optimization is a significant focus in digital advertising, as it directly impacts the profitability and success of online marketing efforts.
Other Key Display Advertising Metrics
- Cost per Acquisition (CPA): Measures the campaign cost divided by the number of conversions, helping businesses understand the cost involved in acquiring a new customer. (If you want to learn more about how to tackle fraud in CPA networks - read this guide)
- Viewability: Tracks whether ads are seen by users, considering an ad viewable if a significant part of it appears on the user’s screen for a set duration.
- Engagement Rate: Measures audience interactions with content, such as clicks, shares, and likes, indicating the content’s appeal.
- Bounce Rate: Represents the percentage of visitors who leave after viewing only one page. Filtering this data for display campaign visitors offers insights into campaign-specific engagement.
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Methods to Measure and Optimize Your Display Ads Campaign Success
There are methods to optimize and measure the success of your display ads campaign encompass a range of strategies and tools designed to maximize efficiency and accurately gauge the performance of your ads. Here are some key methods:
Utilizing UTM Tags for Post-Click Conversion Tracking
By integrating UTM (Urchin Tracking Module) tags into your display ad links, you can effectively track how many users make purchases after clicking on an ad.
These tags, when added to ad links, automatically send detailed click and conversion data to Google Analytics 4 (GA4). This approach provides valuable insights into user behavior after clicking, such as purchase rates.
To streamline this process, you can automate the use of UTM tags and dynamic parameters in GA4, ensuring consistent and precise data collection. This method is key for accurately assessing the performance and effectiveness of your advertising campaigns.
For example, Suppose you're interested in finding out how many people make a purchase on your website after clicking on one of your ads. For this, you can use UTM tags on your ad links. UTM tags are special codes that, when added to your ad links, help send information to Google Analytics 4 (GA4) each time someone clicks on your ad. This helps you see how many clicked on your ad and then bought something on your website.
Evaluating Non-Clickers Through View-Through Conversions
Evaluating the impact of your display ads isn't limited to just those who click. View-through conversions offer insights into the influence of your ads on users who see them but don't immediately click. These conversions track how many people, after being exposed to an ad, eventually search for your product and make a purchase. This method falls under post-click conversion analysis but focuses on the delayed, indirect effects of ads. By tracking view-through conversions, you gain a comprehensive understanding of your ad's overall effectiveness, including its ability to leave a lasting impression that leads to future purchases.
Large advertising services offer specialized tools for tracking conversions from ad impressions, not just clicks. For instance, when you purchase display ads through Google Display & Video 360 (formerly DoubleClick Bid Manager), you can utilize Google Analytics 4 (GA4) for tracking view-through conversions. GA4 provides advanced features and insights, making it a suitable tool for this purpose in the updated analytics landscape.
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Using Advanced Advertising Management Systems
Advanced systems like Google Campaign Manager, Sizmek, and Weborama go beyond basic ad management by providing sophisticated targeting and ad placement options. These systems offer detailed audience segmentation based on demographics, interests, and behaviors, enabling highly personalized ad campaigns.
Additionally, they provide robust scheduling capabilities, ensuring ads are displayed at the most opportune times. The real-time tracking of impressions and user actions supplied by these systems is invaluable for adjusting campaigns on the fly. This data not only helps fine-tune audience targeting but also guides decisions about where and when ads should be displayed for maximum impact and engagement. Essentially, these tools empower advertisers to create more effective and efficient campaigns through strategic ad management.
Integrating Data for Comprehensive Analysis
The integration of data from Google Ads Data Hub, Google Analytics, and CRM systems offers a comprehensive view of your campaign's performance. This integrated approach combines a range of metrics, including Click-Through Rate (CTR), Conversion Rate, Return on Ad Spend (ROAS), Cost Per Click (CPC), Cost Per Acquisition (CPA), and view-through conversions. By bringing together data from various sources, marketers can gain a more nuanced understanding of how different campaign elements perform.
This holistic view is critical for identifying which strategies are working and which need refinement. It also helps in understanding customer behavior and preferences, enabling more targeted and effective marketing strategies. This comprehensive data analysis is key for informed decision-making and ongoing campaign optimization.
Measuring Impact on Overall Marketing
To truly understand the impact of display advertising on the overall marketing strategy, one must look beyond mere conversion metrics. This involves analyzing the influence of ads on market demand and their effect on the Click-Through Rate (CTR) in contextual advertising. It's also essential to understand the synergy between display ads and other marketing channels.
For instance, a display ad might not directly lead to a conversion but could play a crucial role in raising brand awareness, which in turn boosts the performance of search engine marketing campaigns. This kind of analysis requires looking at the broader picture of how all marketing efforts complement each other, facilitating continuous improvement and data-driven decision-making.
Considering Offline Conversions and CRM Data
In many cases, a customer's journey doesn't exclusively take place online. Therefore, incorporating offline conversions and data from Customer Relationship Management (CRM) systems is critical for a complete view of the customer journey. This approach is particularly important for businesses that have significant offline interactions, such as retail stores or call centers.
By integrating this offline data with online data, marketers can gain a more holistic understanding of customer behavior and preferences. This comprehensive view allows for more effective cross-channel marketing strategies and helps in creating a seamless customer experience, both online and offline.
Dealing with Data Limitations and Privacy Regulations
In the digital marketing landscape, navigating data limitations and adhering to privacy regulations like the General Data Protection Regulation (GDPR) is a vital consideration. Tools like Google Ads Data Hub, while powerful, come with inherent limitations in terms of data granularity and privacy compliance.
It's essential for marketers to understand these constraints to ensure that data is interpreted accurately and responsibly. Furthermore, compliance with privacy regulations is not just a legal requirement but also a matter of ethical integrity in data collection and analysis. This adherence to regulations is fundamental to building trust with customers and maintaining a responsible, privacy-conscious marketing approach.
Let’s Track post-view conversions with OWOX BI
OWOX BI offers a sophisticated solution for tracking post-view conversions, enabling businesses to understand the full impact of their advertising campaign efforts. By capturing data on user interactions beyond immediate clicks, OWOX BI provides valuable insights into how ad views translate into eventual customer actions, enhancing overall campaign analysis.
The OWOX BI Tracking Tag collects data about views of videos and banners on advertising platforms and saves this data in your Google BigQuery project. In this case, information is collected at the user level.
This means you can associate ad views with a user’s other activities on your website and offline, tracking the user’s entire path from the first interaction to purchase.
To learn more about post-view analytics for your business, sign up for a demo of OWOX BI.
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To track post-view conversions with OWOX BI, you need to:
- set up the collection of raw user behavior data from your website into Google BigQuery using OWOX BI or [GA4] BigQuery Export.
- Agree with your publishers to place the OWOX BI tracking tag on their websites and clarify the details of the rotation of your creatives.
- Contact us at firstname.lastname@example.org and request tracking tags for each of your ads. Your publishers can then implement these tags through their ad management platforms.
- Upload data from your CRM system to Google BigQuery if you want to count not only online conversions but also offline sales.
As a result, you can build media ad reports with any metrics that are important to you based on data collected by BigQuery.
Here’s an example of a report dashboard:
On the first page, you can see:
- the number of unique users who saw the ad, the total number of ad impressions, and the total ad cost.
- how users interact with the website after viewing advertising: how many sessions and online orders there are and how much revenue they generate.
- how video advertising influences offline purchases: how many offline orders there are and what revenue was brought by users who saw video ads.
- statistics on advertising across the websites on which your ad was broadcast and across each creative.
The second page of the dashboard contains KPIs of media advertising in general and across websites:
- CPA, taking into account the costs of media and contextual advertising that participated in the sales funnel
- Return on ad spend (ROAS), considering online and offline sales
- The number of unique users who already visited your website before seeing the ad video
In addition, in OWOX BI, you can create an attribution funnel that corresponds to the structure of your business — even if the steps are inconsistent and the funnel is complicated. This will help you assess the contribution of media campaigns to the various steps of your funnel and understand at what stage marketing doesn’t work well and where more effort is needed.
Can display ads work for small businesses?Absolutely. Display ads can be a cost-effective marketing tool for small businesses, especially when targeting is focused and campaigns are monitored and adjusted for performance.
What are view-through conversions in display advertising?View-through conversions track how many users complete a desired action after seeing an ad, without necessarily clicking on it. It measures the indirect impact of an ad.
How can I measure the success of my display ad campaign?Success can be measured using metrics like CTR, Conversion Rate, ROAS (Return on Ad Spend), and view-through conversions. Tools like Google Analytics 4 and OWOX BI can provide these insights.
What's the difference between CTR and Conversion Rate in display ads?CTR (Click-Through Rate) measures the percentage of clicks on your ad relative to the number of times it's shown. Conversion Rate, on the other hand, is the percentage of users who take a desired action (like making a purchase) after clicking the ad.
How do I target my display ads effectively?Effective targeting can be achieved by using audience data such as demographics, interests, browsing behavior, and location. Tools like Google Ads offer various targeting options to reach the desired audience.
What are display ads?Display ads are a form of online advertising that includes banners, images, videos, and other graphics. They appear on websites, social media platforms, and other digital spaces to promote products or services.
How to evaluate post-click conversions?Let’s say you want to know how many users placed an order after they went to your website by clicking on a banner. To calculate this, you need to add UTM tags to the links of your display campaigns.
How to evaluate view-through conversions?Large advertising services have their own tools for tracking conversions by impression (without clicking on the link). For example, if you buy display ads in DoubleClick Bid Manager (now called Google Display & Video 360), you can use Google Analytics 360 for tracking view-through conversions.
How to evaluate the impact of media advertising on marketing in general?