What are banner ads good for?

(by Judit from vadjutka)

Let me start with a personal confession: back in my technology journalist past, I was clearly against banner ads. "No one clicks on them, and they are rather a nuisance than something useful for the internet users" I thought. Now, as I manage my own online business, I changed my mind. They definitely do have a place under the Sun, but they are not going to bring traffic and sales directly. So what are they good for?

The success of a banner ad is measured by the so called Click Through Rate (CTR): through the years it has declined significantly from around 5% (in the 90s) to less than 1% (nowadays). This CTR number is the ratio of the number of users who clicked on an ad on a web page and the number of times the ad was delivered (impressions). According to a longitudinal analysis of 5000 websites across Europe, done by tech group Adtech, the performance (CTR) of ads are low: they vary between 0,35 and 0,24%. Not much, hm? Experts say, that it can be much higher (1-2%) if the ad runs on a targeted site: for example in the case of a banner of a film on a movie site. Also, the performance of the banner depends on number of other factors, like the design of the ad, the size of banner, the place of the banner on the site.

The table below shows the click-through trends of the last four years

(by Adtech)

This means, that we should not expect sales directly from a banner campaign. I think that banners are good for showing your face to the public, to show that you and your shop exist. It is good for image and branding purposes, as part of a mid-term strategy; or at least this is what my experiance of using banners says. (I had banner campaigns on several sites like Glibea's Blog, Indie Shopping Blog, Scoutie Girl and Paper'n'Stitch.) Spending your money on banners systematically may result in sales, but first of all: visitors of the hosting site will learn your and your shop's name slowly.

OK, so if you decided to run a banner campaign what factors you should consider when choosing the host for your banner?

- type and thematics of the site

If you have a jewellery shop - like I do - it is more likely you will be noticed on site about fashion, lifestyle etc., though you may consider running a banner on a paper art site...after all its readers are likely to be interested in jewellery as well.

- traffic of the site

The more popular site you use, the more chance you have for being noticed. BUT: usually these sites have more banners than others, so the "banner noise" is bigger.

- cost of the banner and additional services

Some of the sites - with themes about handmade, fashion, design etc - offer blogpost mention or some kind of mention embedded in the content.