Display advertising, also known as display marketing, involves promoting products, services, or brands through visually appealing advertisements such as images, videos, or rich media. These are distributed across various digital platforms, including websites, apps, and streaming services.
These ads, which are usually a combination of engaging visual assets and compelling text, capture users’ attention and encourage the desired action.
Display advertising can sometimes be confused with search advertising. Search advertising is an inbound marketing approach that displays ads in response to user-initiated searches, whereas display advertising is an outbound marketing strategy that proactively shows ads to users across a vast ecosystem of sites.
Display ads are a core component of programmatic advertising, which automates the purchase and placement of ads using data and algorithms in real-time bidding. Historically, common examples included banner ads and pop-up ads. Today, the formats are far more sophisticated, focusing on interactivity and video.
Types of display advertisements.
When considering modern display advertising, it’s important to look at the various types of targeting and ad formats available to effectively reach and engage high-value audiences.
Targeting methods.
Advanced targeting leverages unified customer profiles to personalize delivery. Common methods include:
- Traditional display ads: Ads that are initially placed on websites or apps using foundational market segmentation (demographic or geographic attributes). However, to maximize relevance, modern platforms augment this targeting by leveraging unified customer profiles enriched with real-time behavioral and psychographic data.
- Responsive ads: Responsive ads dynamically adjust their size, format, and appearance to fit thousands of different ad placements and screen sizes. This is enabled by centralized asset management solutions that create ad variations at scale.
- Retargeting ads: Display ads are shown to users who have previously interacted with a brand (e.g., visited a product page or abandoned a cart) as they browse other sites, reinforcing the message and driving conversion.
- Native display ads: Ads that blend visually and contextually with the surrounding content, providing a non-disruptive user experience.
- Social display ads: Ads that are specifically designed for social media platforms, tailored to match the platform’s visual style and user behavior.
Display advertising formats.
The sheer variety of advertising formats offers flexibility and opportunities to increase engagement and track performance:
- Banner ads: Rectangular or square ads that are typically displayed at the top, bottom, or sides of a webpage. Learn more about banner ads here.
- Rich media: Interactive ads that incorporate engaging elements like animation, audio, video, or expandable features to boost click-through rates. Learn more about how to manage your rich media with Adobe Experience Manager.
- Video ads: Ads in video format — often served pre-roll, mid-roll, or post-roll — which offer higher engagement and are increasingly critical in channels like connected TV (CTV). Learn more about video ads here.
- Interactive content: Ads that embed features like quizzes, polls, games, or product configurators, allowing the user to engage directly within the ad unit. Learn more about managing interactive content with Adobe Connect.
Display advertising billing.
When a business uses display advertising, it must understand the payment models that tie investment directly to business goals. In performance marketing, every dollar spent is accountable. Here’s an overview of the most common key performance indicators:
- Cost per mille (CPM): Advertisers are charged based on the number of impressions their ads receive (typically per 1,000 impressions). CPM focuses on exposure and is strategically used in brand awareness campaigns or high-reach channels like CTV.
- Cost per click (CPC): Advertisers pay for each click their ads receive. This model is performance-oriented, as advertisers only pay when users actively engage with the ad and is a common metric for top-of-funnel engagement.
- Cost per lead (CPL): Advertisers pay based on the number of qualified leads generated through the ad campaign. It’s commonly used when the primary goal is lead generation.
- Cost per acquisition (CPA): Advertisers are charged based on the number of conversions or sales generated that were directly attributed to the ad campaign. This is the ultimate metric for measuring ROAS and campaign effectiveness.
- Flat rate: Advertisers pay a predetermined fixed amount for a specific duration or number of impressions, regardless of the ad’s performance. This model is often used in direct deals with premium publishers.
Challenges of display advertising.
Despite its strategic benefits, display advertising presents specific challenges that require modern solutions focused on data quality, personalization, and user experience. Here are some of the challenges and ways to overcome them:
- Signal loss and data quality. The industry’s shift away from third-party cookies creates a major challenge for precise targeting and measurement, necessitating a reliance on proprietary, privacy-centric first-party data strategies. Furthermore, data quality remains a top concern among marketers, impacting the accuracy of programmatic campaigns.
- Ad fatigue and frequency management. Over-exposure to the same creative causes ad fatigue, leading to decreased engagement and negative brand sentiment (also referred to as banner blindness). Strategic marketers must utilize AI and frequency capping tools to find the “sweet spot” of exposure — often 3 to 5 impressions per week for B2C campaigns.
- Brand safety and ad fraud. Ad fraud and appearing on made-for-advertising (MFA) websites are constant risks in the open programmatic environment, diluting budgets and risking brand equity. This requires partnering with trustworthy tech providers that offer advanced fraud-detection and brand-safety controls.
- Creative relevance at scale. The need for high-frequency campaigns to combat ad fatigue demands constant creative rotation. Without dynamic creative optimization (DCO) or generative AI tools, manually producing personalized variations for each segment is a significant resource bottleneck.
Benefits of display advertising.
Display advertising is a powerful component of a cohesive marketing strategy, enabling superior customer engagement and measurable financial outcomes. Using display advertising helps businesses:
- Increase brand and long-term firm value. Unlike some short-term tactics, display advertising, particularly when leveraging high-impact formats, contributes significantly to long-term brand building and firm value.
- Target customers with first-party precision. Modern display advertising allows marketers to reach their audience with granular precision. By activating unified customer profiles built from first-party data (website behavior, purchase history, app usage), marketers can target users based on real-time behavior and intent, ensuring ads are seen by the most relevant users.
- Design a full-funnel performance campaign. With programmatic buying, advertisers can design and optimize their campaigns to effectively target customers at every stage of the sales funnel, from brand awareness (CPM) to sales conversion (CPA).
- Maximize content velocity with dynamic creatives. Display advertising leverages platforms that automate the production of thousands of visual variations. Solutions like Adobe Experience Manager Assets with dynamic media allow marketers to rapidly scale content and ensure the right image or video is served dynamically, removing creative bottlenecks.
- Retarget and drive customer lifetime value (LTV). By displaying retargeting ads to users who have previously interacted with the brand, businesses reinforce their message, encourage conversions, and effectively focus investment on prospects with high customer lifetime value (CLV) potential.
- Measure strategic impact and ROI. Display advertising offers robust measurement capabilities, allowing advertisers to track metrics like reach, conversion rate, and return on ad spend (ROAS). These insights help marketers perform data-driven optimizations that directly impact pipeline and revenue.
Getting started with display advertising.
Display advertising is a valuable tool for businesses to enhance their marketing efforts and achieve strategic goals. By moving beyond traditional mass-market buys and embracing a data-driven, personalized approach, businesses can increase brand awareness, target specific customer segments, and dramatically improve campaign performance.
To achieve this level of precision and scale, a marketer must leverage a platform that unifies customer data, orchestrates complex journeys, and enables real-time optimization. Here’s how you can get started:
- Unify customer data (the foundation): Adobe Real-Time CDP helps you build and manage the unified first-party customer profiles necessary for cookieless targeting and accurate frequency management across platforms.
- Activate hyper-personalized campaigns (the execution): Adobe Journey Optimizer manages scheduled omnichannel campaigns and one-to-one moments for millions of customers. It helps brands intelligently determine the next best interaction with scale, speed, and flexibility across the entire customer journey.
- Optimize creative and experience (the result): Use tools like Adobe Target for continuous A/B testing and personalization of landing page experiences, and Adobe Analytics to close the loop on attribution and measure performance across all touchpoints.
The future of display advertising is in data quality, content relevance, and real-time decisioning.
Request a consultation to start building your strategic foundation today.
