Display ads have benefits too, Google says

22 April 2009

MOUNTAIN VIEW, California: Google, the internet pioneer, has released a new piece of research showing that display advertising offers better returns to US marketers in terms of "cost per click" than its search equivalent, although the latter still drives the vast majority of online traffic.

Google analysed annual data from 25,000 advertisers using its AdSense network – which has a penetration rate of around 80% among US adults – amounting to 1 billion "clicks" and 70 million clickthroughs.

It found that where companies use both search and banner ads, the latter is 2.6% cheaper in terms of "cost per click" than the former.

Furthermore, over half of the advertisers making up its sample were said to have received a better return from display ads than search on this measure.

However, over 80% of all clickthroughs came from search ads, compared with just 20% driven by display executions placed across Google's network.

Dennis Woodside, the company's new head of sales in the US, has also suggested that, thus far, Google has established "deeper relationships" with agencies and advertisers, and particularly the marketing holding groups like WPP, in Europe than America.

He also argued that ad agencies play a "critical" part in helping major advertisers increase their presence online, with Google's role being to "help them understand the various digital opportunities."

Data sourced from AdAge; additional content by WARC staff