Introduction to Online Ad Services
As our technology improves, the internet continues to provide new and innovative tools for advertisers. The medium is so effective, that statisticians predict that by 2020, digital advertising will grow to will represent 46.3% of total advertising expenditure worldwide (up from 31.5% in 2015). Meanwhile, traditional forms of advertising will see their budgets shrink.
However, with the introduction of new technology, advertising options multiply, and it becomes more difficult to pinpoint the strategies that are right for your business. Whether you are considering doing some advertising of your own or deciding upon a company to manage an entire online marketing strategy on your behalf, being well-versed in common jargon and strategies will help you to set expectations and objectives for your campaign. This article breaks down some key concepts and steps that will help you find the best fit for your business.
Before you start to plan your online advertising strategy, you should first calculate how much you are willing to spend. Most companies spend roughly 10% of their revenue on marketing with around 40% of that marketing budget being spent on digital/online advertising. However, these numbers vary based on business size and industry, so it is important to do some research on what similar businesses spend on both traditional and online forms of marketing.
In general, online advertising is sold in one of three ways:
1. Pay per Click (PPC)
PPC (also referred to as cost per click or CPC) is a performance-based advertising method in which an advertiser is only charged when a visitor clicks upon their ad. To avoid overspending, you can set a daily budget for each PPC ad. PPC is the most closely associated with search engine marketing and is highly effective for precisely targeting key consumers on which to focus your attention.
2. Cost per Thousand Impressions (CPM)
CPM works by charging a price based upon the number of visitors who are shown your ad (not necessarily those who click it). You may set a desired budget by specifying a number of impressions. In some cases, networks require advertisers to bid on CPM in the same way as is done for PPC. If you are apprehensive of diving into a PPC campaign, CPM is a good alternative to gauge interest in your ad by monitoring its clickthrough rate (CTR), or the number of clicks the ad receives. You can then use this information to calculate an appropriate budget for a PPC campaign.
3. Fixed Cost
Advertisers may pay a fixed price for their ad to appear for a specified length of time, regardless of how many people view or click the ad. You can either work directly with a website to run a fixed cost ad or, more commonly, purchase advertising through an ad network. When using an ad network (such as Google AdWords or Microsoft adCenter), your ad appears across a range of websites that match your desired conditions.
Your overall marketing budget may very well be made up of a combination of these buying options, and an online marketing agency can work with you to tailor a comprehensive marketing strategy to get you the best return on investment (ROI).
Search Engine Marketing
Search engine marketing (SEM) is one great way to connect with consumers who are interested in topics related to your business. The field of SEM is comprised of both paid search and organic search.
1. Paid Search
With paid search engine marketing, your results will appear in the “sponsored ads” section at the top or side of the results page of any search that includes your ad’s chosen keywords. This is a form of PPC advertising in which you bid on your desired keywords that will trigger your ad. Finding the right keywords and knowing how much to spend on them can be a tricky process.
It’s important to keep an eye on consumer trends to see which ones are currently in fashion. Google’s own keyword suggestion tool is invaluable in not only generating a veritable thesaurus-worth of relevant words and phrases, but also in telling you how often people search these terms and how much you’ll need to spend to advertise your chosen keywords. For certain industries, it is much preferable to have a greater number of specific lower-traffic terms rather than one or two broader (and more expensive) higher-traffic terms.
2. Organic Search
The goal of a successful organic (unpaid) search engine strategy is to optimize your content in order to appear higher in the engine’s ranking algorithm. This process is referred to as search engine optimization (SEO).
When determining where your website will place in the unpaid results for a specific search, Google uses a complex algorithm to rank your site based on relevance and quality. Basically, Google determines relevancy based on keywords in your website’s content, and it determines quality based on how often your site is linked elsewhere.
Periodically checking your site’s “bounce rate” (or the percentage of users who land on your site and leave without clicking on anything) and, if applicable, your abandoned cart rate is important to gauge whether or not your advertising is leading to effective results. High bounce and abandoned cart rates mean that consumers are losing interest in your website sometime after accessing your ad. Some common reasons why visitors “bounce” are poor user experience, disconnect between an ad and the actual content of the website, and lack of perceived value in the item or service being sold.
If you are having difficulty determining why your advertising is not leading to conversions, a search engine marketing professional can evaluate this data for you and work to adjust your marketing strategy for optimum results.
Display ads are another potential channel for online advertising. These are the ads that you see off to the side, down at the bottom, or even popping up in front of you when you visit most websites. Ad banners are a flexible type of advertising as they come in many shapes and forms and with multiple pricing options, including the aforementioned CPM and fixed cost.
The key to display advertising is getting your product in front of the right people. Sites like Facebook and Google apply collected data from users to target only those who are likely to be interested in your product.
Inbound marketing uses more subtle forms of advertising than SEM and banner ads to attract customers. It can involve any combination of social media, blogging, YouTube, newsletters, events (and the list goes on). As opposed to outbound marketing, in which advertisers seek out consumers, inbound marketing focuses on bringing the consumer to them.
Inbound marketing encourages the consumer to interact with the brand on a more personal level. As such, inbound marketers focus on building brand recognition and creating a relatable brand persona that entices like-minded customers.
Content marketing, such as blogging or creating video, is one component of this overall inbound marketing strategy that helps to attract consumers. Through content marketing, companies use these platforms to share information not only about your products, but also about your company’s values and lifestyle.
Choosing an Online Advertising Agency
There are a multitude of reasons to choose one ad agency over all other options, and although the following is not a complete list, it does cover the most important attributes to consider when choosing the best match for your business.
1. Industry Expertise
The ideal match will have experience using a combination of the aforementioned online advertising methods to market for your specific industry. As the field of online marketing continues to expand, many internet marketers have chosen a particular niche in which to specialize. You can find clients’ recommendations and case studies to get a better idea of the agency’s specialties and abilities.
2. Online Presence
You can find out a lot about an online ad agency by its online presence. For example, “Is their website well-designed?” “Do they have a good amount of interesting and useful content?” You will also want to check their online materials for signs that demonstrate knowledge of current trends and an ability to creatively adapt them to suit their clients’ needs.
3. Competitive and Transparent Pricing
Take time to make sure that the agency’s billing process is absolutely clear to you before jumping into an agreement. The last thing you want is an agency that is not transparent and upfront about its prices. You don’t have to use the cheapest option (especially if it doesn’t provide the best value), but you should make sure that you are choosing a competitively priced service.
4. Data-Driven Success Monitoring
Finally, knowing how a potential agency tracks and measures success will help you to find an agency with knowledge of analytics and data and can help you translate this information into profits. A good agency uses concrete and measurable data to drive long-term business growth, revenue, and user engagement.