What is Digital Advertising and Getting started as a Digital Advertiser
Jan 31 2019 | 07:32 PM | 15 Mins Read | Level - Basic | Read ModeIndrajeet Deshpande Contributor, Ziff Davis B2B
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Indrajeet is a Marketing professional with 6+ years of experience in managing different facets of Digital Marketing. After working with SpiderG - a Pune based SaaS startup, he is now ready to work as a freelance marketer with different SaaS startups helping them with marketing strategy, plan and execution. His love for old-school hard rock and metal music culminated in taking up guitar and starting www.guitargabble.com.
He’s studying Stoic philosophy, experimenting with productive habits and documenting the progress. Get in touch if you’re keen to know how you can implement pro-wrestling tactics in your marketing, community building and storytelling.
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Digital advertising is the practice of delivering promotional content to users through various online and digital channels. It leverages mediums such as social media, email, search engines, mobile apps, affiliate programs and websites to show advertisements and messages to audiences.
Welcome to MTA’s MarTech 101 (#MarTech101) series, where we take a deep dive into the basic ideas, concepts, and tools of MarTech. No matter where you are in your MarTech journey, this exploration of the basics is sure to help you do your job even better.
In this installment of the MarTech 101 series, we look at the concept of digital advertising.
The rise of search, display, social, native and programmatic advertising has given brands a plethora of opportunities to take their brand name to the next level.
This primer will give you a 30,000 foot view of the digital advertising landscape. We will start with the bare-bones of digital advertising, look at its evolution, the various ad formats, and the AdTech ecosystem. The Fives of Digital Advertising section will provide a macro-level perspective of digital advertising metrics, best practices, trends, frauds, and the challenges of the space.
Table of Contents
Section I: Introduction to Digital Advertising
- What is Digital Advertising?
- How Did Digital Advertising Begin?
- What Are the Digital Advertising Formats?
- Programmatic AdTech — What Is It and When Do Brands Use It?
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Section II: 5 Aspects of Digital Advertising
- Digital Advertising Metrics
- Digital Advertising Best Practices
- Digital Advertising Frauds
- Digital Advertising Challenges
- Digital Advertising Trends of 2019
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Section III: Conclusion
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Introduction to Digital Advertising
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Section I: What Is Digital Advertising?
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Stopping advertising to save money is like stopping your watch to save time.�
~ Henry Ford (Founder of the Ford Motor Company)
Digital advertising is the practice of delivering promotional content to users through various online and digital channels.
Traditional (non-digital) advertising widely followed the spray and pray approach. It reached out to the masses, but the ROI was largely undeterminable. Digital advertising, as we know it today, is heavily data-driven and can give you minute details of your campaigns and outcomes. The availability of user data and rich targeting capabilities makes digital advertising an important tool for businesses to connect with their audience. It is useful to remember that while the connected world offers may ways to reach and engage with customers, there is a distinction between ways that are free or ‘organic’ and paid or ‘inorganic’. Digital advertising is an ‘inorganic’ way to reach and engage with customers and prospects.
Also Read: 5 Top Advertising Trends in 2018: The Future is Digital
How Did Digital Advertising Begin?
On October 27th, 1994, one of the first banner ads appeared on HotWired.com (Wired Magazine’s first website), and the advertising industry witnessed the emergence of digital advertising. The banner ad was 468*60 px in size and read “Have you ever clicked your mouse right HERE? YOU WILL.�
(Source: thefirstbannerad.com)
The ad was for AT&T;’s virtual tour of seven of the world’s art museums. According to Joe McCambley, who worked on this ad, it received a whopping 44 percent CTR!
With the release of Google AdWords in 2000, Google AdSense in 2003 and Facebook ads in 2007, the digital advertising industry evolved by leaps and bounds. Tracking, optimizing and controlling ads became possible for small- and medium-sized business owners.
In 2019, digital advertising is used to drive traffic to websites, generate leads, build brand awareness, establish thought leadership, build engaged communities and generate sales.
What Are the Digital Advertising Formats?
Since its inception in 1994, digital advertising has been steadily innovated upon. Today the diverse digital advertising landscape consists of various ad formats. You could even use an amalgamation of two ad categories to create a new one. For example, you can use remarketing with display ads to reach out to your existing visitors to remind them to complete a purchase. This section lists five of the most commonly used digital ad formats.
Note: This section is not a complete list but is meant to give you an overview of the most commonly used ad categories.
1. Search Engine Marketing
When searching for something on Google or Bing, a few search results with the tag ‘Ad’ appear at the top of the Search Engine Results Page (SERP). These ads are the result of search engine marketing.
Search Engine Marketing (SEM) is arguably the most commonly used ad format. In SEM, you bid on keywords along with your competitors to appear at the top of the page.
SEM ads can either be Pay Per Click (PPC) — pay every time someone clicks on your ad or Cost Per Mille (CPM) — pay for every 1000 impressions on your ad, regardless of the clicks.
You can see some examples below:
2. Display Ads
Ads, as we know it, began here. Display ads primarily use text and images and appear on third-party websites, which are usually affiliated with search engines or other ad networks. Many websites self-host display ads as well. The most common types of display ads are images, mobile, text, banners, pop-ups and video ads.
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3. Social Media Ads
Your audience spends a lot of time on social media, and this presents a huge opportunity to advertise your brand. You can use social media platforms such as Facebook, Twitter, YouTube, Instagram, LinkedIn, Reddit, etc. to promote your brand and products. Social media ads can help you right from building a community, generating leads and increasing event attendees, to boosting website conversions, app installations and growing footfalls to your retail store.
Also Read:Â What Is Social Media Advertising? Definition, Costs, Best Practices, Benefits, and Examples
4. Native Advertising
Native ads can appear on social media sites or other web pages, and they don’t look like typical ads. They appear under ‘Recommended Reading’, ‘Related Stories’ or ‘Promoted Stories’ that visually match the content you’re currently reading, only upon clicking, you’re redirected to the advertiser’s website.
Native advertising is generally routed through content discovery websites such as Taboola, Outbrain and Columbia to name a few.
5. Remarketing
Have you ever checked a product on Amazon and later while scrolling through your social media feed come across an ad for that exact product? That’s remarketing. Also known as retargeting, remarketing uses cookies to follow you on the web. Almost every major social media platform as well as Google currently offer the remarketing feature.
Also Read: 6 Effective Ways to Extend Campaign Themes Across Multiple Mediums
Programmatic AdTech — What Is It and When Do Brands Use It?
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“As an industry, we’ve overbuilt and over-engineered the marketing technology stack. Re-evaluate your ad tech stack and see if it’s as simple as possible.�
~ Oleg Korenfeld (Global Chief Platforms Officer at Wavemaker)
Source: MarTech Advisor’s The Beginners Guide to The AdTech Ecosystem
Another frequently used term in the realm of digital advertising is AdTech. The advertising ecosystem has two main entities viz. the advertiser and the publisher.
The goal of advertisers is to create and manage ad campaigns, target them to the right prospects and customers; track ad spend and their results, while also finding ways to optimize the bidding process and ad spend.
Publishers — the entities that own the websites — are the digital equivalent of newspapers or magazines — the place where ads are shown — or ‘served’, in digital parlance. They provide the ‘space’ for ads to be shown, manage the ad inventory of different advertisers, collect campaign data and make sure that the customer experience is as positive as possible during the process.
Also Read: Digital Ads and User Experience: Frenemies Forever?
With the whole process being dynamic and taking place in real time, you need a system that functions flawlessly, while serving both parties.
That’s where AdTech comes in. Advertising Technology (AdTech) consists of tools and software that enable the programmatic buying and selling of ads. ‘Programmatic’ is the automated system by which millions of ads can be served to millions of internet users across millions of websites — in real time — and the clicks and responses can be tracked and measured and reported to the advertiser in near-real time.
The AdTech ecosystem consists of ad servers, Supply-Side Platforms (SSP), Demand-Side Platforms (DSP), Data Management Platforms (DMP), ad exchanges, ad networks, analytics, and data suppliers.
Also Read: Why MarTech – AdTech Convergence Matters for you in 2018?
Section II:Â 5 Aspects of Digital Advertising
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As we are now acquainted with the concept and various formats of digital advertising, let’s go through a 25-point list divided into five sections, which will help you gain a working knowledge of the main aspects of digital advertising.
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1. Digital Advertising Metrics
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“Tracking marketing is a cultural thing. Either tracking matters or it doesn’t. You’re in one camp or the other. Either you’re analytical and data-driven, or you go by what you think works. People who go by gut are wrong.�
~ Stuart McDonald (CMO at Freshbooks)
Metrics help you decide on the next steps to take, with certainty. In this section, we’ll look at five digital advertising metrics that you should track.
Note: These metrics are not specific to any particular website and are useful regardless of the format or type of the digital ad campaign.
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A. Reach and Impressions
‘Reach’ denotes the number of people who were able to see your ad.
‘Impressions’ denote the number of times your ad was displayed. As an ad can be shown to the same person more than once, the number of impressions might be higher than the ‘reach’ in many cases.
B. Click-Through Ratio
Click-Through Ratio (CTR) is the percentage of clicks to impressions. So, if you get two clicks every 100 impressions, your CTR is 2 percent. You can use this metric to understand the effectiveness of different ad campaigns. For example, if you receive the same number of impressions on two different campaigns — the campaign with more clicks will have a better CTR and therefore will have performed better.
C. Conversions
‘Conversion’ is the number of people that completed the intended action by clicking on the ad by following your Call to Action (CTA). The action could be downloading an e-book, purchasing a product or signing up for your services.
D. Cost Per Acquisition
Cost Per Acquisition (CPA) measures the aggregate cost incurred to acquire a paying customer. It can be measured by dividing total campaign expenditure by the number of conversions.
E. Return on Investment
Return on Investment (ROI) is the ultimate metric to evaluate the effectiveness of your campaigns. Also known as Return on Ad Spend (ROAS), ROI measures how much revenue the campaign generates compared to the cost required to run the campaign.
Also Read: 5 Ways to Use Data-driven Advertising
2. Digital Advertising Best Practices
“What really decides consumers to buy or not to buy is the content of your advertising, not its form.�
~ David Ogilvy (Founder of Ogilvy & Mather)
Here are five simple yet crucial best practices to help you kickstart your next digital advertising campaign.
Note: The tips mentioned here are digital ad platform or media agnostic.
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A. Have a Strong Call to Action
CTAs act as a gentle nudge for your audience. When you mention action verbs such as “Download Now,� “Buy Now,� “Learn More,� or “Register Today,� it prompts your user to take the next step in the process.
B. Keep it Simple!
The adage “less is more� stands true in digital advertising. Your audience doesn’t have all the time in the world to go through a long text-heavy ad; therefore, there is no need to be redundant and clutter your ad copy and creatives. The simpler the ad, the more effective it will be!
C. Be Device & Channel Responsive
Your customers live in a multidevice, multi-channel world; and ad creatives must be developed to not just render well on any device or screen size — mobile, laptop, desktop, tablet — but also be relevant to the medium or platform itself. An ad designed for TV is not going to work on the internet or on a mobile.
D. Follow Brand Guidelines
Your brand identity differentiates you from the rest of the pack. To make sure your ads stand out, always place your brand identity design strategically on your ads.
E. Test, Test, and Test
A/B testing is a widely used practice by marketers and advertisers to understand what resonates with their audience. Keep experimenting with your ads to see what works best and focus on doing more of that. Also stay abreast of the latest updates to the various ad platforms and innovate with them.
Also Read: 5 Practical Ideas to Gamify Your Marketing Strategy
3. Digital Advertising Frauds
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Along with the benefits that digital advertising brings to brands, the industry is also unfortunately infested with fraudulent activities. Hackers and fraudsters use unethical practices that eat up a massive chunk of advertisers’ budget. Statista has predicted that ad fraud practices are going to incur losses of $44 billion for brands in 2022, $23 billion more compared to 2018. Here are five examples to be wary of in 2019.
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A. Bots
Botnets are also capable of causing Denial-of-Service (DoS) attacks by tipping the web server beyond its capacity, making the website unavailable to its target users.
The human equivalent of bots are click farms. There are essentially low-cost resources whose sole job is to click on ads, bringing no real benefit to the advertiser.
B. Pixel Stuffing
Pixel stuffing, also known as iframe stuffing, is the malpractice of placing ads that are 1*1 pixel (not visible to the human eye) in size. So, an impression is recorded with every pageview, even though the visitor did not see the ad. The advertiser ends up paying money for absolutely nothing.
C. Popunders
Sketchy websites largely use popunders — exactly the opposite of pop-up windows. They appear beneath the main window instead of above. A legitimate impression is recorded even though the visitor was largely unaware of the ad. Although popunders aren’t exactly fraudulent, they still bring no value to advertisers.
D. Domain Spoofing
Simply put, domain spoofing leads an advertiser to believe that their ad is going to appear on a relevant, premium website when in reality it is not. Domain spoofing uses a variety of techniques to trick the advertiser and visitors, where the only entity benefiting from it is the fraudster.
E. Ad Stacking
Ad stacking is quite similar to popunders, in terms of results. This method loads a stack of ads on top of one another, so only one ad is visible, but impressions are recorded for every ad. The user never sees the other ads, which are billed to advertisers, though with no results.
Also Read: 3 Tips For Detecting And Preventing Mobile Install Fraud
4. Digital Advertising Challenges
"An ad is finished only when you no longer can find a single element to remove."
~ Robert Fleege (Robert Fleege & Partners)
Along with ad fraud, the following are five critical challenges that digital advertisers and publishers face.
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A. Ad blockers
Publishers have found a workaround to this with native advertising. Since native ads come across as a part of the website UI, they are less prone to being blocked by ad blockers.
B. Increased Ad Costs
In this crowded ad space, social media ads and SEM ads have become quite expensive. Although bigger brands are putting more money into their ad budgets, the ROI is not as it used to be.
C. Lack of Transparency
Transparency has been a focal point of conversations among the digital advertising fraternity for quite some time now. Ad frauds, lack of standard practices and the difficulty in ascertaining accurate metrics sometimes strain the brand–publisher relationship.
D. Ad Blindness
Today’s buyers are smart. They can ignore what they feel is not relevant to them. To support this, a research report by Google found that 56.1 percent of ads are not ‘seen’ by internet users.
E. GDPR
The introduction of General Data Protection Regulation (GDPR) in Europe has given a large chunk of users control over their personal data, but the stringent regulations have put advertisers and publishers on the backfoot. And similar regulations are being cemented in the rest of the world including America and several Asian countries. Programmatic advertising was able to recuperate after a setback during the initial months of the post-GDPR world. However, with brands already engaging in contextual advertising and influencer marketing, digital advertising is set to go through a metamorphosis.
Also Read: The Renaissance of Contextual Advertising
5. Digital Advertising Trends of 2019
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Despite ad fraud and myriad challenges, the digital advertising industry shows no signs of slowing down. Here are five digital advertising trends that will rule 2019.
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A. The Ascent of Video Advertising
Video saw an upsurge in 2017, and it continued to dominate our news feeds in 2018. Looking at the trend, we can safely say that video isn’t going anywhere soon. New trends such as live videos and 360-degree videos have led to new avenues for marketers to generate engagement.
The easy availability of recording equipment has made it convenient for businesses to get moving with video marketing. And to top it all off, the ability to add Closed Captions (CC) to videos has made video search friendly, which is a huge shift in terms of SEO.
B. Native Advertising
As mentioned earlier, native advertising is not intrusive and enables ads to blend in with the content of the page. Instead of directly promoting the brand, native ads showcase content that is relevant to what the user is currently reading. It therefore provides value without disrupting the user experience.
C. Making the Most of Micro-Moments
Micro-moments are specific instances where users turn to their smartphone to know more, go somewhere, or do or buy something. US adults spend an average of 3 hours 35 minutes every day on their smartphones, and in 2019 it is predicted to surpass the time spent watching television. Planning your search marketing campaigns tailored around micro-moments, coupled with the latest locational data-based advertising is a surefire way to succeed in 2019.
D. AR Becomes a Reality
Pokémon GO made a splash when it released in 2016. The combination of augmented reality and location-based gaming made every Pokémon fan and gaming fan go gaga over it. The introduction of Google Lens and Apple ARKit promises huge opportunities for advertisers to use augmented reality in advertising.
E. Let Voice Search Be Heard
The rise of conversational commerce and the adoption of digital assistants on a massive scale makes voice search very hard to ignore in 2019. In fact, by 2020, half of the searches will be voice searches. Therefore, it’s necessary to lay the foundations by optimizing your current SEM campaigns for voice search.
Section III: Conclusion
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The Future of Digital Advertising
In 1994 AT&T; paid HotWired $30,000 for a three-month campaign to place their ad above-the-fold on their website. In 2019, the digital advertising industry will be worth $220.38 billion. From the figures, it is evident that digital advertising has seen staggering growth in the last 25 years. This quick-paced evolution coupled with constant innovation is the sign of a bright future for digital advertising and digital marketers.
Here’s to your success!
We hope that this primer on Digital Advertising helped you and will continue to help you in your marketing journey.
Do share your digital advertising experiences with us on social media. We’re always listening and already ready to have a great conversation!