Display Marketing – How does it work?

Display marketing actually exists since the introduction of television. With the rise of the Internet, the term became widespread and is now mainly associated with banner ads. This article explains why this is no longer the case. Furthermore, it's important to understand both the advantages and the disadvantages of display marketing.

Display Marketing

What is Display Marketing?

Display marketing describes all marketing measures on screens and other digital media. This includes classic online advertising such as banners and affiliates on websites, as well as retargeting strategies for purchase processes and the advertising screens used in Digital Signage.

Goals of Display Marketing

Display marketing is designed to attract attention. The objective is to both increase sales and promote the companies image. Therefore, much is done with visual effects through images and video and less with pure text.

On websites, the focus is on getting people to click and redirect them to a designated landing page. Here, a successful conversion directly affects sales.

Two of the most commonly used techniques on websites, when not looking for advertisers themselves, are:
  1. Advertising networks: Website owners provide certain space on their pages for publishers to display advertising banners. Publishers take care of processing and advertisers. Google Ads or DoubleClick are typical examples of advertising networks.
  2. Affiliate networks: These are often found on blogs. Authors link in their texts to the store pages of the affiliate provider. These are assigned through a special identifier when a purchase or click is made. Numerous affiliate programs are available on Amazon, eBay and other stores.

The digital advertising displays from our industry focus on image and brand promotion. This is accomplished through so-called infotainment, the symbiosis between advertising, entertainment, and information. However, direct sales can also increase through spontaneous purchases at the point of sale, such as a supermarket checkout.

Retargeting strategies are designed to capture customers who have jumped off during the ordering process and then explicitly address them again.

Techniques for Ad Placement

We distinguish several techniques advertising networks use to place ads in different media.

  • Real-Time Bidding: Ad slots are allocated via a real-time auction. Advertisers can set a maximum bid to have their advertisements displayed.
  • Behavioral Targeting adapts the display of advertising banners to user behavior. If you are already searching for a product, you will receive offers that are tailored to your search behavior. If you search for vacuum cleaners, you may receive ads for different brands.
  • Contextual Targeting: The advertising is based on the context of the products. If you are looking for vacuum cleaners, ads will be placed for dust bags or other accessories.
  • Native Advertising: Here, the advertising is embedded in a “natural” context. This is often the case with news magazines. At first glance, the ads are virtually indistinguishable from normal content.
  • Remarketing: When you revisit a website, you may receive offers for products you've looked at before.

In all these techniques, the role of recognition value is essential. A variety of tracking mechanisms are used here, with varying degrees of aggressiveness.

Advantages of Display Marketing?

Display marketing offers the following advantages:
  • High reach
  • Improvement of the brand
  • Stimulate consumptive behavior of the customer
  • Addressing different target groups at the same time
  • Integrable into a digitized workflow

High reach

Whether on large reach websites or with digital signage displays at busy transport hubs, display marketing provides advertisers with enormous reach for relatively little money compared to traditional advertising.

Improvement of the Brand

Since ads in display marketing have a mostly visual and emotional character, you can strengthen the image of the company and individualize or specialize the brand or company presence on the net.

Stimulate Consumptive Behavior of the Customer

Appealing ads on websites encourage people to buy and also ensure spontaneous purchases at the digital PoS. This significantly boosts sales.

Address different Targets Groups at the same time

Individual, customizable ad banners appeal to different target groups by using the above-mentioned techniques. Digital advertising spaces at traffic hubs can switch between different content, depending on the time of day. Digital marketing offers a higher flexibility than billboards and newspaper ads.

Integrates into a digitized workflow

One of the most important advantages of digital marketing is its ability to be integrated into digital processes. KPI's and billing are created automatically and transparently.

Interfaces facilitate convenient exchange of data and automation with different software solutions. These would be for example: Merchandise management, CRM, personnel planning, visualization, accounting, and content creation by agencies. Multiple channels of marketing, such as tablet, desktop, mobile, or social media platforms, become much more efficient.

Through retargeting, a store gets the chance to win back customers who appeared to be lost during the conversion process. The digitization of marketing presents us with entirely new opportunities to attract customers and increase customer satisfaction.

Disadvantages of Display Marketing?

Display marketing also has disadvantages, especially when used on a large scale.
  • Leads to sensory overload and so-called banner blindness
  • Worsen the user experience
  • Violation of data protection and privacy
  • Sometimes negative consequences for the brand
  • Users “fight back” with ad blockers

Marketing and advertising are effective tools for gaining positive attention, but only when used appropriately and in measured doses. However, the saying 'too much of a good thing' holds true, and with excessive use, we achieve the complete opposite.

Sensory Overload and Banner Blindness

Banner blindness describes a phenomenon that users experience after some time. The more banners there are, the fewer people will notice them. Our brains will adjust to them, and we will unconsciously suppress their perception. Conventional banner ads now have click rates of around 0.1%. The rapid increase in stimulus overload on the internet and banner blindness have contributed significantly to this development.

The same is also true for digital advertising displays. As light pollution in city centers increases, people exposed to it develop greater tolerance.

Worsen the User Experience

Large banners that fidget, abrupt overlays or pop-ups, and ads disguised as content all negatively impact the user experience. When readers are unable to focus on the content without being distracted, they will leave.

Violation of Data Protection and Privacy

Many digital advertising playout techniques rely on user identification. These must be reliably recognized even when crossing domain boundaries. This works with what are called tracking mechanisms, which register via cookies in the web browser. Meanwhile, this may only be done if the user explicitly allows it, in compliance with the GDPR.

As a consequence, display marketing loses a number of important key performance indicators. A similar scenario could emerge for DooH installations. These are now often equipped with sensor technology and camera systems. Facial recognition software now enables nearly precise gender recognition. If this continues to develop at such a rapid pace, we will move into areas of person recognition combined with Big Data.

It is only a matter of time before legislation is introduced to address this issue.

Sometimes negative Consequences for the Brand

Display marketing that is not appropriately targeted or used with too high a frequency can have a counterproductive effect. If the target group is annoyed by the advertising, they will no longer perceive the advertised brand as positive. It is possible that customers will actively avoid products because of the intrusive advertising.

User “fight back” with Ad Blockers

Instead of designing smarter advertising, the advertising industry decided to make their banners, pop-ups, and overlays even more eye-catching and intrusive in the early 2000s. This forced users to defend themselves.

Ad blockers and pop-up blockers are a reaction to excessive and invasive advertising. Their spread brings new challenges to the management of companies. Unfortunately, in my opinion, many website operators, especially publishers, are often resistant to advice and do not invest in quality or alternative forms of marketing, but instead try to undermine ad blockers technically and legally.

Regardless of what these measures look like, they complicate marketing and lose potential customers.

Conclusion Display Marketing

Display marketing opens up many opportunities to improve a brand's image, inspire customers and increase sales. However, “too much” has a counterproductive effect. The challenge is to find the right balance between emphasizing quality and not giving the impression that customers are just a number on a revenue account.

Gravatar Nikolaos Sagiadinos
Author: Niko Sagiadinos
Developer & Co-Founder SmilControl – Digital Signage
Visit me on: LinkedIn or GitHub

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