The two types of ads

Fred Wilson has a great post about display advertising discussing a recent comScore white paper about the subject. Fred's bottom line:

"The basic insight from the report is that display advertising does not normally result in an immediate click. That makes sense because the ad is not being presented in a moment of purchase intent, like a search ad is. But the ad does create interest in the product or service which is realized at some later date in the form of a site visit, a search query, and possibly on online or offline purchase."

I think that the common distinction between "display ads" and "search ads" is not the right distinction… The distinction should be between:
  1. Demand Creation Ads – these are ads that notify the consumer about a brand, it's values and reasons to purchase it (whether factual or emotional). Display ads would typically fall into this category. 
  2. Demand Fullflilling Ads – these are ads that offer the consumer an effective shortcut to fullfiling a purchase that s/he has pretty much decided to execute. Search ads would typically fall into this category.   

Demand Fullfilling Ads (DFA's?) is a fairly mature business on the web. Demand is best expressed through a search box, and search ads are an extremely effective way of fullfilling that demand. As comScore noted – the immediacy of conversion on these ads is very high, however in terms of raw volume – there aren't many of these ads. 

However, for Demand Creation Ads (DCA's?) there is no such Google yet. DCA's have to be interesting, not necessarily relevant. That's because the consumer has not yet expressed their intent, and therefore 'relevancy' is no more than an educated guess. 

To date, the DCA's on the web can be categorized into 2 categories:
  1. Interruption ads – banners, etc are intended to capture an audience consuming content and interrupt them with ads. 
  2. Contextual ads – text ads that algorithmically emulate search advertising on non-search pages. 

Contextual ads may be relevant but, they certainly are not interesting. And therefore they mostly fail at being effective demand *creation* ads. They are also not effective as being demand *fullfilment* ads because they are presented to users who have not expressed their commercial intent. 

We're only scratching the surface with Demand Creation Ads. The future lies in the word "interesting", not necessarily in "relevant" and I think there are exciting opportunities to displace and significantly improve on both interruption ads and contextual ads. 

Leave a comment

Add New Comment

* Your email address will not be published. All fields are required.