Does Online Display Advertising Actually Work for Small Businesses?

Many small business owners, and marketers they employ, often wonder, "Does online display advertising actually work?"

  1. You have unclear budget realities.

    It’s not likely that you’ll outspend larger competitors with online display ads. Yet, when you place a miniscule ad buy, on a very large website, which only reaches 5% of their audience and maxes out your budget, you complain that “online advertising doesn’t work.” Wrong conclusion, delivered by a flawed approach. Instead, remain focused on targeted niche websites to cut through the clutter of larger websites and deliver a higher share of voice (SOV). Simply put, target your efforts and maximize the potential of your ad actually being seen.

  2. You suffer from really bad creative.

    Your team won’t tell you because they want to keep their jobs. But onlookers will confirm this: your ad creative is horrendous. It includes 100 messages, poor image quality and a hidden call to action (CTA). Simply put, online users aren’t going to click on ugly ads that make their heads hurt. While you may not have the benefit of an ad agency to show you the light, you can still develop ads that make customers say “Wow! I love that product!” Simplicity is everything. It could be that online advertising works, but your ads don’t.

  3. You ignore location, location, location.

    If you can buy prime online real estate — do it. Why? Because location, where online ads are placed, does matter. Think of buying online ad space as if you were house shopping. It’s not likely you’ll buy on a bad block, miles outside of civilization. So, don’t do this when you purchase ad space online. Ad placement is essential. When an online user visits the website, what hoops do they have to jump through to see your advertisement? If I have to click, scroll, zoom and click again to see your ad … you get the point.

  4. You think size doesn’t matter.

    Every small business marketer needs to know the standard display ad sizes available across the web. Larger ad units will generally outperform smaller ones. So, if you’ve only ever purchased small ads, instead, purchase a mix of ad sizes and analyze performance.

  5. You forget that audience is everything.

    Display advertising may not work for you because you’re advertising to the wrong people in the wrong place. If you take a look at historical sales and customer data, you can draw conclusions about your buyer. The places you advertise should reflect online places where your buyer would hangout. If you need to reach small business owners, you’ll need to target online websites that speak directly to them. Most importantly, all websites are not created equal. Simply because you pay $10 to reach potential customers on one site does not mean you can expect to pay the same for another website. If you gain access to a highly qualified audience you will pay a premium.

  6. You haven’t considered RFT.

    You’ll need to balance online display advertising goals with reach (R), frequency (F) and time (T) objectives. To increase one, you’ll have to sacrifice the other. So, consider what is most important to you. For instance, you can’t advertise for one week and proclaim “it didn’t work”. Advertising is all about exposure to your message and that takes time. An awareness campaign will require high reach (i.e. opportunities to see) at an optimal number of exposures per person. In contrast, if you need to generate leads, your tactics will change and you’ll need to consider what a lead is worth to you?

  7. Your dollars can’t work harder.

    Optimize ad placements (#6) and creative (#5/7) then apply learnings. If you place on online ad buy and never measure its progress, who’s to blame? Track the progress of your online campaigns so your ad spend can work harder for you. If a specific creative is not working, swap in a new one. If an ad placement is performing poorly, upgrade to a more prominent ad space. When you’re ad is not visible, increase your impression levels to ensure an adequate share of voice (SOV) or weight among other advertisers.

  8. You fail to test and scale.

    Set aside a specific online advertising budget for testing purposes. Then put your test budget to work. One quick and dirty calculation is cost per conversion. Consider the total cost of an online ad buy in comparison to the total number of conversion events (i.e. click, registration, sale, etc.). If you spend $100 on online advertising that produces 100 visitors (at $1 each), and received 15 sales, your cost per conversion is $100 / 15 = $6.67. In theory, if you scale your spending you can project conversions with an uptick in ad spend. This doesn’t account for other important variables such as the lifetime value of a customer or those who take an action at a later date, but it can be used as a very granular starting point.

These eleven tips barely scratch the surface, but they can set your small business up for online advertising success. Learn more about online advertising best practices here and never assume online advertising doesn’t work. Much like the gym, it will work — if you work it.


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