Posted: April 5th, 2013
In a recent research paper by the Harvard Business School called, Do Display Ads Influence Search? Attribution and Dynamics in Online Advertising, researchers identified two major flaws in how many of us look at metrics.
From the executive summary,
The introduction of online metrics such as click through rate (CTR) and cost per acquisition (CPA) by Google and other online advertisers has made it easy for marketing managers to justify their online ad spending in comparison to the budgets used for television and other media.
However, these metrics suffer from two fundamental problems: (a) they do not account for attribution, since they give credit to the last click and ignore the impact of other ad formats that may have helped a consumer move down the conversion funnel, and (b) they ignore the dynamics, since they only account for the immediate impact of ads.
Further into the paper, the three researchers found that “each $1 invested in display and search leads to a return of $1.24 for display and $1.75 for search ads.” As a result, there should be “an increase in search advertising budget share by up to 36%, followed by a commensurate reduction in display.”
This is where search retargeting can help bridge the gap between search campaigns and display campaigns. In case you’re not familiar with search retargeting, I suggest you read the article on What Is Search Retargeting over at State of Digital.
Two learnings and tactics can now be employed with the advent of search retargeting, as mentioned in this Search Engine Land blog post.
1. By showing display ads to consumers that are searching for related products or keywords outside of a SEM campaign, marketers increase awareness and potentially drive consumers to continue their search quest for their product.
2. Display ads would be shown to consumers who searched for the marketer’s product, which could increase the CTR of the display campaign.
Have you tested any campaigns with search retargeting technology? What percentage of your media budget do you see shifting to it, and where do you see this budget coming from?