What is Display Advertising?
Display advertising is a form of paid digital marketing that uses visual ads — banners, images, videos, and rich media — placed on websites, apps, and social platforms to build brand awareness and drive clicks.
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What is Display Advertising?
Display advertising is paid visual advertising shown across websites, mobile apps, and social platforms — including banner ads, sidebar ads, interstitial pop-ups, and video placements.
Unlike search advertising where users actively search for something, display ads interrupt users while they’re browsing content. That fundamental difference shapes everything about how display works. Average display ad click-through rates hover around 0.35% across industries (Google data), compared to 3.17% for search ads. But display’s strength isn’t clicks — it’s visibility. Display ads generate billions of impressions daily, making them the backbone of brand awareness campaigns.
Google Display Network alone reaches 90% of internet users worldwide across over 2 million websites and 650,000 apps.
Why Does Display Advertising Matter?
Display ads keep your brand visible to potential customers even when they’re not actively searching. That top-of-mind presence drives future search behavior and direct visits.
- Brand awareness at scale — Reach millions of people across thousands of websites for CPMs as low as $1-5
- Retargeting power — Display is the primary channel for retargeting website visitors with relevant ads after they leave your site
- Visual storytelling — Unlike text-only search ads, display lets you use images, videos, and animations to communicate brand identity
- Full-funnel coverage — Display works at awareness (prospecting), consideration (retargeting), and conversion (dynamic product ads) stages
Most businesses use display alongside search and social — not instead of them.
How Display Advertising Works
Display ads reach users through ad networks, ad exchanges, or direct publisher deals.
Ad Formats
Standard banner sizes (300x250, 728x90, 160x600) are the most common. Responsive display ads automatically adjust their size and format to fit available placements. Rich media ads include interactive elements. Video display ads autoplay in banners. Google’s Performance Max campaigns now combine display with other formats automatically.
Buying Methods
You can buy display ads through self-serve platforms (Google Ads, Meta Ads), programmatic DSPs (The Trade Desk, DV360), or direct deals with specific publishers. Programmatic advertising handles the vast majority of display transactions through automated real-time bidding.
Targeting and Placement
Display targeting includes contextual (show ads on pages about relevant topics), audience-based (target specific user profiles), and placement-based (choose specific websites). Smart campaigns combine all three — showing your ad to the right person on the right website at the right time.
Measurement
Track impressions, clicks, CTR, view-through conversions (people who saw the ad and later converted without clicking), and assisted conversions. Display ads rarely get credit in last-click attribution models, which undervalues their actual impact on the conversion funnel.
Display Advertising Examples
Example 1: Retargeting campaign An online shoe store shows display ads featuring the exact products visitors viewed but didn’t buy. These dynamic retargeting ads achieve a 0.7% CTR — double the display average — and a 10:1 return on ad spend because they target high-intent users.
Example 2: Local brand awareness A new dental practice runs Google Display ads targeting people within 10 miles who’ve searched for dental-related topics. Budget: $1,500/month. The ads don’t generate many direct clicks, but branded searches for “Smile Dental Austin” increase 45% during the campaign. theStacc helps local businesses complement display efforts with SEO content — publishing 30 articles monthly that capture the organic search demand display advertising generates.
Common Mistakes to Avoid
Most businesses make the same handful of errors. Recognizing them saves months of wasted effort.
Chasing tactics without strategy. Jumping on every new channel or trend without a clear plan. TikTok one month, LinkedIn the next, podcasts after that — none done well enough to produce results. Pick your channels based on where your audience actually spends time, not what’s trending on marketing Twitter.
Measuring the wrong things. Tracking impressions and likes instead of conversion rate and revenue. Vanity metrics feel good in reports. They don’t pay the bills.
Ignoring existing customers. Most marketing teams focus 90% of their energy on acquisition and 10% on retention. The math says that’s backwards — acquiring a new customer costs 5-7x more than keeping one.
Key Metrics to Track
| Metric | What It Measures | Good Benchmark |
|---|---|---|
| Customer Acquisition Cost (CAC) | Total cost to acquire one customer | Varies by industry — lower is better |
| Customer Lifetime Value (CLV) | Revenue from a customer over time | Should be 3x+ your CAC |
| Conversion Rate | % of visitors who take desired action | 2-5% for websites, 15-25% for email |
| Return on Investment (ROI) | Revenue generated vs money spent | 5:1 is a common benchmark |
| Click-Through Rate (CTR) | % of people who click after seeing | 2-5% for ads, 3-10% for email |
Quick Comparison
| Aspect | Basic Approach | Advanced Approach |
|---|---|---|
| Strategy | Ad hoc, reactive | Planned, data-driven |
| Measurement | Vanity metrics (likes, views) | Business metrics (revenue, CAC, LTV) |
| Tools | Spreadsheets, manual tracking | Marketing automation, CRM integration |
| Timeline | Short-term campaigns | Long-term compounding strategy |
| Team | One person does everything | Specialized roles or automated workflows |
Frequently Asked Questions
Is display advertising worth it for small businesses?
For brand awareness and retargeting, yes — even with small budgets ($500-2,000/month). For direct response, search ads typically deliver better ROI. Many small businesses use display primarily for retargeting their website visitors.
Why are display ad click-through rates so low?
Because display ads interrupt browsing rather than answering active searches. A 0.35% CTR seems low, but across millions of impressions, it still drives significant traffic. And many display ad conversions happen through view-through attribution, not clicks.
Should I use display or search ads?
Both serve different purposes. Search captures existing demand. Display creates and nurtures demand. Start with search to capture bottom-of-funnel intent, then add display for retargeting and awareness once search campaigns are profitable.
Want organic traffic that doesn’t cost per impression? theStacc publishes 30 SEO-optimized articles to your site every month — automatically. Start for $1 →
Sources
- Google: About the Google Display Network
- WordStream: Display Advertising Benchmarks
- IAB: Display Ad Format Guidelines
Related Terms
An ad exchange is a digital marketplace where advertisers and publishers buy and sell ad inventory in real time through automated auctions — functioning as the stock exchange of online advertising.
Ad NetworkAn ad network is a company that aggregates available ad space from publishers and matches it with advertisers looking to reach specific audiences — acting as a middleman between supply and demand in digital advertising.
Click-Through Rate (CTR)Click-through rate (CTR) is the percentage of people who click a link compared to total impressions. Learn the formula, benchmarks by industry, and how to improve CTR.
Programmatic AdvertisingProgrammatic advertising automates the buying and selling of digital ad space using algorithms. Learn how it works, types, benefits, and key platforms.
Retargeting PixelA retargeting pixel is a small piece of JavaScript code placed on your website that tracks visitors and adds them to audience lists — enabling you to show targeted ads to those visitors as they browse other sites and platforms.
