The root cause of the problem: standardized ad units that were created about a decade ago, so publishers could easily sell and agencies could easily buy space. This was big step forward because it gave us a common currency. However, we know today that the old ad units are not working. We need to create new ones that are more powerful for brand advertisers and place them into environments truly conducive to their success.
Here are the two biggest challenges we face.
Poorly Designed Environment
The first thing we need are cleaner publisher websites. The typical home page for a publisher website has more than 150 links. Some major publishers have more than 290 links. This is ludicrous. Index and article pages are also inundated with content. Our agency conducted an ethnographic study and found that many users are exposed to more than 10,000 different links a day. Sticking an ad with a bigger link with a little bit of color and some flash into this gluttony of links creates additional noise.
Scientists like A.K. Pradeep from Neurofocus have studied the effect of display advertising with modern neuroscience technology and found that , in Pradeep's words, "The human brain has virtually no reaction when it is exposed to a banner ad." But we don't need neuroscience to see the problem, just look at click-through rates. We enjoy unprecedented targeting abilities. It doesn't matter what shoe, car, TV or coupon interests your target audience, your ad will find it within 24 hours. Yet only one out of 1,000 people clicks.
The core of the problem is that the paradigm for website design was established during the days of the dial-up modem. Rather than asking users to navigate through a series of pages, the industry made all key links available on all key pages. This reduced both server calls and the time required by users to access information. But now that high-speed connections are virtually ubiquitous, pages should be designed like information kiosks. It's okay for each page to be more streamlined, with fewer links, because each downloaded page arrives almost instantaneously. Users can rapidly click through more pages, which gives them a better reading experience, while giving the advertisers a less distracting creative canvas where ads can be proportionally bigger in size. Even ads equivalent in size to many of the units currently sold will be less disruptive and more integrated with site content because there will be less content on the page.
Incorrectly Applied Tactics
The other reason banner ads stink is that we're using them incorrectly. Banner ads are a bottom-of -the-sales-funnel, direct-response tool, meant to draw prospects into action after they become interested in a product. They are designed to be mathematically profitable for brands, since they use metrics to determine return on investment of direct-response campaigns. They are extremely effective as a direct-response tool because they are priced appropriately.
The problem is that many advertisers have taken this bottom-of -the-funnel tool and used it to build awareness and interest in their products. They are using it as a top and middle-of -the-funnel tool. This doesn't work and the reason is simple: The units we use are too small. To build awareness, you need something that is either a lot more interruptive, disruptive or engaging. Because publisher sites have so many links and so much content, nobody wakes up in the morning saying, "Hey, I want to see a banner ad." There is not enough visual impact to build awareness.
Many brands have tried to use banner ads to emulate TV's reach and frequency model. This approach is dead wrong. TV ads, prior to the days of digital video recorders, had the ability to fully engage consumers, because they take up the entire screen for a fully engaging 30 seconds. They could be used to not only build awareness, but push people through the interest stage of the funnel by describing a product and emotionally engaging the audience. Banner ads will never emotionally engage the target audience. Without emotional engagement, there is no breakthrough brand. They are too small to efficiently build awareness and too simple to emotionally engage the audience.
Where Do We Go From Here
Like any addiction, the first stage is recognizing that there is a problem. We all need to admit that we are addicted to banner ads, but they are not giving us the buzz we wanted. Unfortunately, breaking the addiction is going to be hard. The chills, sweats and night tremors are about to kick in. It's time for us to move forward; to create cleaner sites that put digital advertising in position to succeed and to learn how and when to use standard banner ads. If we can rise up to this challenge, we can revolutionize advertising the way we once thought we would.