Digital Advertising: Is It Worth It?
Advertising is one of the most important things your business can do, but what sort of advertising actually works? That’s the question we’ve been trying to answer in our ongoing advertising series.
Digital advertising is not just reserved for the big brands—in fact, it’s one of the most accessible and affordable forms of advertising out there. But how do you measure its value?
Does plastering Instagram with your logo really increase your following? Or do those swipe-up, buy now ads return piles of money for the companies that run them? Let’s break digital ads down and see what they’re all about.
Digital Advertising Cost
Digital advertising by far carries with it the widest price range out of any other form of advertising. That’s because in many cases you can set your budget, and the price you pay for conversions can be fine tuned.
How Do You Measure Digital Advertising Costs?
Costs are often measured in two key ways: CPC (cost-per-click), and CPM (cost-per-mille, meaning cost per thousand impressions). This means your company will have spent X amount of dollars for each click your ad gets, or for each thousand impressions (views). You can also measure things like follows or likes with social media platforms. Finally, you can choose to measure CPA (cost-per-acquisition). CPA uses a specific metric (set by you) by which to measure how much you paid for each conversion.
Types of Digital Adverts
Google Search Ads – Google Search Advertisements appear at the top of the search results in Google. You can target these based on specific keywords so that when a user is looking for a particular service or product, your business shows up at the top. There are two kinds of Google Search ads:
- Responsive, which are automatically selected by Google based on what’s most relevant to a user’s search. The way these work is you create a few different headlines and up to four different descriptions and then Google will pick two of four…etc.
- Expanded Text, which are composed of three headlines and two description lines, authored by you, but grouped around a specific set of keywords in an ad group.
Display Ads – Display ads are visual ads that can be either static images or animated. These are the ones you see on monetized websites (like blogs or news sites). These websites offer advertisers space that can be bid on through Google’s AdSense platform (which is where you’ll have to submit your ads). These ads differ from Search ads because users are likely not actively looking for the thing you are advertising.
Facebook Ads – Nearly everyone has seen a Facebook ad at some point. They can range in their format, but are typically composed of photos or videos along with some text in the description. These ads appear similar to user posts, helping them to blend in with a user’s feed. When you create a campaign, you can select where you want your ads to appear. Because Facebook also owns Instagram, you can advertise with both platforms at once, or design separate campaigns for both platforms.
Instagram Ads – Instagram ads are very similar to Facebook ads in that they often appear in a user’s feed. Instagram’s “stories” feature also presents advertisers with another medium through which to engage with users. Instagram ads can be controlled through the Facebook for Business ads manager, and can be tailored based on your budget.
Twitter Ads – Twitter advertisements show up like a Tweet in user’s feeds, and can be budgeted around “cost per follower”. Like other digital platforms, advertisers can fine-tune who they are targeting to get that cost per follower ratio as low as possible over time. Though plain text is the most common feature of Tweets, advertisers can also employ photo or video ads.
Measuring Return on Investment (ROI)
The absolute basics of measuring your return on investment in digital advertising is similar to all ROI measurements: how much did you put in, and how much did you get back?
When looking at metrics like CPC and CPA; if you earn more money on conversions than you spent on ads, then you are getting a good return on your investment. Other ways to measure could include looking at how qualified the leads are that you are getting from your ads and comparing that with how much you are paying for each lead.
Alternatively, if you are looking to raise brand awareness without any attached conversion metrics or goals, then your ROI is less tangible, and generally should be measured in impressions rather than conversions. In other words, look at how many people actually saw your ad—the higher the number, the better your company’s visibility.
With more than half the world actively accessing the internet, digital ads are invaluable for companies that want to grow. Plus, with an incredible amount of visibility compared to traditional media when it comes to how well your ads are working, digital ads are without a doubt one of the most impactful methods of advertising. The tools available to online advertisers have changed marketing completely, turning the way marketers measure success into more of a science and less of a guessing game.
And remember that digital advertising lets you see what sort of impact you are making on potential customers; plus, you can get started for just a fraction of the cost of traditional advertising. Hopefully this article leaves you knowing a bit more about the digital ad world, and makes creating your first ad seem a little less daunting. Good luck and go get ‘em.