Whither the Click? How Online Advertising Works

The click rate on Internet display advertisements averages only 0.1%. This article investigates whether this implies that online display ads are ineffective, or alternatively that they work in a way similar to brand advertising in other channels. The data source (described) was comScore's large Internet panel. Exposures were passively tagged, and test and control groups of matched exposed/non-exposed were thus created. In 139 display campaigns, panellists' subsequent behaviour was monitored. On average, visits to an advertised site increased 65% the week after exposure, and this lift continued at a declining rate during the next 2-3 weeks; this could not have been observed from clicks or cookie-tracking alone. Three empirical generalisations are proposed: 1. Even with low click rate, display ads can generate substantial lift in site visitation, trademark queries and online plus offline sales. 2. Search ads are more effective than display ads, but the higher reach of display ads means that they can generate larger sales increases overall. 3. Synergy with search advertising produces higher effects than either type of advertising separately.