You see display ads on many websites. Have you ever wondered how advertisers measure if the ad is successful or not?  And on what factors will the success of the ad depends?

Click through rate(CTR) is a way of measuring the success of a display ad besides the fundamental impressions. So what is CTR? It is the ratio of number of clicks on an ad and the number of impressions expressed as a percentage. What does CTR depends on? CTR broadly is a function of 3 terms – category, creativity and placement.

CATEGORY:

CTR largely depends on the category of ad. Categories such as telecom, automobile, electronics have higher CTRs as compared to FMCG, cosmetics, grocery etc. Ads of categories that involve high cost and higher research tend to have higher CTR on their ads.

Look at it this way, a person who wants to buy a car will surely do higher research on different brands unlike when he buys grocery or cosmetics items. It also depends on interest and intent of a person and the risks involved. If a person is interested in a product, he will search for it and if an ad comes up of related product, there is high probability that he will click on it.

Here is a table showing approximate average monthly searches worldwide of different categories:

CREATIVITY:

Creativity is important, an innovative banner gets higher CTR as compared to a standard banner. Take the example of Volkswagen, it got high CTR for its banner ad for Polo GTSI in which car came and went out of the page and came back.

There are many ad sizes such as 300 x 250 pixels on right side of page, 720 x 90 pixels banner called mast head on top and some on left. So there are many combinations possible. Volkswagen used a 300 x 250 plus 720 x 90 plus the two left side banners of the page and showed the car moving across.

Marketers can make rich media, audio visual ads for greater creativity. For example, some banners can have sharing capabilities built in them, others can have options to tweet and still others can integrate a video player.

For example, VW made a banner which when clicked showed different features – first click showed mileage, second click showed engine power. So banner became entire microsite. As a result Volkswagen had CTR of 3% against industry average of .2%.

Here is another great example of creativity, VW launched New Jetta in 2011 and decided to create conversations about the car and increase its desirability. It decided that rather than telling the people that they would do anything to drive the Jetta, let the people tell them what they would do to drive the Jetta.

VW launched #anything4jetta contest on twitter. It ran interactive teaser banner ads in the form of game in which characters came on the screen and users had to type them correctly really fast. If they misspell the Jetta will come and go out of the frame.

Display banner advertising was heavily used to promote the contest.Interactive banners were placed on yahoo where a viewer could tweet from banner itself and enter the Twitter contest.

When VW started the campaign, there were only 3 million users of twitter in India. If it had limited itself to the 3 million users of twitter, it would have never got the kind of participation that it did. The interactive banners told the user to participate even if they did not have a twitter account.

PLACEMENT:

Placement of ad is as much important as is the creativity. What is the point of creativity if Ad does not reaches its target audience. Ad should suit the content of the site. For example, a car brand would be advertised on car sites, you don’t want to waste your money by advertising it on a cookery site or an entertainment site.

Again take the example of Volkswagen, when the brand was new in India for creating awareness it advertised on reputed, influential and high traffic news and information portals such as MSN, Sify, MoneyControl, and Yahoo. For influencing consumers who were looking out for information about cars but are not actively searching for VW, it advertised on car portals and review sites such as Carwale, Team BHP and Overdrive.

Now see this scenario, a user is seeing information about some popular car say Hyundai Verna, then Volkswagen will show the display ad of same range car say Vento to induce customer to consider Vento as well.

Moreover, it gives an incentive to the customer such as free accessories worth Rs 20,000 with Vento. The ad induces the consumer to click which then takes them to the website of Volkswagen. This is an example of perfect ad placement.

Placement of ad on Yahoo:

Although CTR depends on category, but with creativity and good placement you can definitely increase CTR and hence success of you ad. What do you think?