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PEAR, or Why a .3% Click-Through Rate for a Banner Ad Is Perfectly Acceptable

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Back in 2007, Ford ran a banner ad that was a simple yet attractive photograph of the inside of an Explorer. It was a sleek-looking interior, and I could easily envision myself sitting in that vehicle, my young children safely strapped in the back seat. It made me feel good to just imagine that for a moment. However, at the time, I drove a year-old 15-passenger van, so a new vehicle purchase was not on my radar.

Did I click on the ad? No. What would be the point? I wasn't ready to purchase.

Three years later, a driver crossed the highway median, hit us head on, and totaled my 15-passenger van. The replacement vehicle purchased with the settlement money was (surprise!) a Ford Explorer.

And that is why a .3% click through rate is perfectly acceptable.

Because what are the odds that at the very moment people see a banner ad for a product, they are going to have their wallet open, ready to purchase?


So, why bother with online ads if consumers aren't going to click on them and purchase?

Online ad response looks even more daunting when we look at reality. According to Pew Research, in 2011 companies spent $32 billion dollars on digital ads—an increase of 23% over 2010. Online ads make up 20% of all advertising in the United States.

Looking at those numbers, it's obvious that consumers cannot possibly make a purchase with every ad that is presented on their screens.

What is important about online banner advertising?

It's not all about the immediate click-throughs and immediate purchases your digital banners produce.

What is important is "potential eyeball and retention"—PEAR. A key goal with online advertising is brand retention and recognition. You want to have the consumer seek out your product when they are ready to make a purchase.

Here are five ways your company can achieve PEAR.

1. Design banner ads that reflect your brand and keep your message consistent

If a single banner placement brings a .3% click-through rate, don't interpret that as an immediate message failure. The goal is to repeatedly get your consistent brand message in front of customer eyeballs.

You may want to test several designs that reflect your brand and message, but with slightly different graphics or a different accent color. Then test to see whether there are any differences in response. Note, though, that it takes more than one week on a site or one appearance in an e-newsletter to conclude that a banner ad is ineffective.

2. Research your audience and be selective about placements

Who is your demographic? What types of sites do they visit? Do they visit blogs? Are they reading hobby-related e-newsletters? Carefully analyze your placement options. Don't simply place an ad on a site because its pageviews are high. What's more important is that the audience demographic match your product.

Study the blog, site, or e-newsletter placements you are considering. How many other banners are visible at the same time? Will your banner rotate with others each time a customer lands on the page? Are you the sole banner in the e-newsletter or is it buried somewhere near the bottom?

3. Use visual opportunities via your social networks

Study your blog, Facebook wall, Pinterest boards, and Twitter account for available visual spaces.

Create a Facebook Cover graphic that is a larger version of your latest digital marketing banner. When Facebook implemented Timeline's large Cover graphic, a major car company used a photo of its office building as its Cover photo. Was the brand message that it wanted to put in front of consumers really a steel and metal building? Was the company using the same building in its digital banners and advertisements? Likely not...

Build a presence on Pinterest, and create a Pinterest board for your digital ads and banners. Pinterest now drives more traffic than Facebook. Do what it takes to get that traffic coming to your boards where they can view your digital ads. A board or two with your current digital and print ads is acceptable among your other, content-driven boards.

However, just as with other social media, you should also aim for conversation, not just repeated broadcast of marketing messages; you'll want to have more than just promotional boards on Pinterest, for example. Don't forget to disseminate links to your boards via tweets and Facebook updates.

4. Partner with key bloggers in your market

Do not underestimate the reach of bloggers. Some may not have the large number of pageviews that a business site enjoys, but they have engagement with a very targeted audience.

Banner placements on blogs may bring extra perks. Some bloggers will also promote their advertisers on their other social networking accounts. That may not yield direct click-throughs to your site, but it does get your brand name in front of eyeballs. Again, think PEAR.

Arrange reviews and giveaways. In a survey of consumers from March to June 2012, About.com found that 84% of respondents needed to view the brand as trustworthy before they would "interact" with the brand, and 41% of those surveyed said being able to read reviews on social networks increased their trust in a brand. Nielsen surveyed 28,000 Internet users in 50 countries, and 79% of the respondents said they trust online reviews of products.

So, before approaching blog owners, read their other reviews and get a feel for their review style. How do they handle features they think need improvement? Is it a writing style that meshes with your brand? Do they blog photos of their family using products? In the About.com survey, 34% of respondents said seeing pictures of other customers using the product was one way to build trust in brand.

When arranging the review of your product, provide the blogger with a graphic of your banner ad, links that maybe of interest, and product to give away. If as a result you attract 300 participants in the giveaway, that is a very targeted 300 sets of eyeballs learning about your product (and, possibly, looking at your banner ad).

Bloggers often promote such giveaways on Twitter and Facebook, and some even require entrants to tweet a specific message about the giveaway—again an opportunity to get your brand in front of eyeballs and in the memory of your target customer.

5. Commit the funds and time

Two or three well-placed banner ads over the course of a year will get your banner in front of your audience, but it most likely will not get your product retained in consumers'  brains.

Unless a banner ad is so creative and memorable that it goes viral on Twitter, Facebook, and Pinterest, you will need to plan on placing your banner ads repeatedly and consistently in front of your market's eyeballs.

Companies are allocating a larger percentage of their ad dollars to digital marketing. Pew Research Center's Project for Excellence in Journalism reported a 25.5% increase in dollars spent on digital ads from 2009 to 2011. Your competition is most likely following this trend, so you need to as well.

* * *

To wrap up, here are the five takeaways:

  1. Focus on PEAR—potential eyeball and retention rate. If you focus solely on click-through rates, you'll miss the long-term goal of ensuring that consumers think of your product and brand over the competition's when they are finally ready to make a purchase.
  2. Pageviews and subscriber rates are important, but also consider the demographic of the audience. Sometimes the focus can be solely on the quantity of the audience and not the quality, but think both.
  3. Review the available digital spaces on your social networking accounts. Are you fully making use of those spaces and bringing a consistent banner campaign, message, and branding to those available areas? Each can be effective on its own, but to have a collective and consistent message across social media spaces boost PEAR.
  4. Partner with bloggers for reviews and giveaways. The quality of engagement they have with very targeted markets can exponentially increase the PEAR opportunities through their Twitter and Facebook reach. In addition, research indicates that brand trust is gained through reviews.
  5. Budget for repeated placements. The spend on digital banner ads is increasing. Most likely your competition is following the trend, so you need to as well.

 


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Michelle Eichhorn is director of marketing and events for Apologia Educational Ministries, Inc.. She can be found on the Web at eyecorn.com and @eyecorn on Twitter.

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  • by Lynn Mon Dec 3, 2012 via web

    Great article but .3% is extremely high for standard banner sizes.

  • by Elizabeth Mon Dec 3, 2012 via web

    I think this is a conflicting message and that the overall recommendation towards brand marketing and buying more display is less valid for most businesses than the contextual piece . A large brand advertiser (like a Ford) can afford to blanket a brand message cross-platform in order to build mindshare and influence preference over time. However, with more niche brands - not necessarily small businesses, but not massive brands- I'd go for context every time when buying display. A message bought to live in context - which is point #2 and #4 yet pretty much glossed over here - will react far better than one placed by the numbers.
    That said, I also think a smarter play is to start moving away from display altogether and spend on content and integrated marketing (context again).

  • by Bryan Tue Dec 4, 2012 via web

    I think this is a great article. Like the other comment, 0.3% is very high for display ads- something more around 0.05% is standard.

    That being said, I think this article hit the nail on the head about branding and display ads.

    As far as content and integration, at some point, there's going to be too many brands playing in the same space. Look at what is happening with Facebook. Organic posts used to see more engagement, and now user newsfeeds are becoming filled with an increasing number of brand posts, leading to a decrease in user engagement and increased aggravation.

  • by Michelle Tue Dec 4, 2012 via web

    I agree, content is a top priority for building relationships and establishing trust between brands and customers. However, banner ads still have a place in a marketing plan--again, mostly for putting the brand name/logo/product photo in front of potential customers. In the niche market we serve, we typically see a 1% to 2% click-through rate on e-newsletter ads and some banner placements--part of this is the level of engagement overall in our niche market, and also in play is where we place-we do a lot of targeted placements on blogs and e-newsletters. (@eyecorn)

  • by Darryl M. Tue Dec 4, 2012 via web

    The article recaps strong basics. These concepts are also coved in AdWords certification. Additionally, when running paid or nonpaid banner campaigns within content networks, don't forget to tag links along with changing the campaign expiration because even click throughs at time take longer than 6 months to convert. Nothing worse than having a fuzzy optic of what drives conversion.

  • by Mike Wed Dec 5, 2012 via web

    Good Article. I agree a good creative is key to "PEAR", the other thing that is vital is hitting the right audience. From what I've seen behavior/click streams are not a valid representation of whether or not someone will buy something (as you clearly defined in the article), which is why cookies are not effective and why a .05% CTR is considered acceptable. My company has developed a custom audience building solution using our extensive offline address level database that we were then able to cluster into what we deem "IP Zones". This technology has been consistently producing CTR's from .11% to upwards of .69%. People vote (purchase) based on their wallets, not based on their browsing behavior....www.semcasting.com check it out - Key to staying on par with PEAR

  • by Lauren Proctor Wed Dec 5, 2012 via web

    Well said. If a user doesn't click on an ad it doesn't necessarily mean they didn't see it. I'm curious to see what happens when tracking and interactivity becomes more rigorous for TV ads. Will people take action as often as they do with banner ads? It will be an interesting comparison and like you say, immediate action isn't everything.

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