The advertising industry has been transformed by the internet. The internet has transformed the advertising industry by replacing traditional channels such as TV, billboards and sponsorships with cheap and trackable online channels like social media ads and display ads.
This is the beginning of democratizing the industry. If they have the right knowledge and ad creatives and target, even small brands can compete on the same platform with multinationals. Online advertising is the best place to start if you want your business to grow.
This guide will show you how to do it. This guide will explain why online advertising is so important, which are the best channels for advertising online and how to start an online advertising campaign.
What is Online Advertising?
Online advertising is hugely popular. Nearly two out of three small businesses use it to win new clients. The global online advertising market is expected to reach $646 billion by 2024. This compares with $378.16 billion in 2020.
Online advertising is a type of paid-for marketing that uses internet-based channels for promoting products and services. There are many online advertising channels available, including search engines such as Google and Bing, social media platforms and display ads and banner ads.
Online advertising costs are much lower than traditional media. For a few hundred dollars a month, small businesses can attract hundreds of customers. Online advertising is also more easily measurable. Online advertising can be tracked and measured in order to optimize campaigns.
Online advertising is so beneficial that companies are increasingly directing more of their budgets to digital channels.
This infographic by Visual Capitalist shows that there has been a sharp decline in TV and newspaper advertising spending. However, search, social media and ecommerce spending have increased significantly since the early 2000s.
Why your business should advertise online
Online advertising, no matter how big or small your business is, can help you build a brand and win new customers. While it has many benefits over traditional advertising and other forms online marketing, there are four main benefits that I would like to highlight.
Online advertising doesn't require you to wait for months, weeks or even days before you get paid. Your ads can go live and sales are possible immediately.
This is unlike virtually any other form of marketing–traditional or otherwise. For example, SEO takes on average three months to get a page ranked well on Google. Social media accounts grow at 9.4 percent to 16% every six months.
You can see results faster and win more customers. It also allows you to optimize your campaigns faster. You can optimize your campaigns faster to maximize ROI because you receive data so quickly. Paid ads take only three months to complete what took six months for SEO.
Optimizing PPC campaigns can help you double or even triple your ROI. Easton Sports has seen its ROI increase by 400% to 900% through the collaboration with The Good, an e-commerce marketing agency.
Target More Effectively
Don't be limited by broad, mass-market advertisements that try to please everyone. Online advertising allows you to drill down into your target market, and can be sure that every dollar is being spent on them. This is the type of targeting that traditional advertising cannot match.
Many online advertising platforms offer granular targeting. This allows you to target a specific segment of your audience. Facebook allows you to customize your target audience using a variety of criteria.
This means that you don't need to worry about spending your advertising budget on people not interested in your product. You can easily target people if you have strong buyer personas. Even if you don’t have buyer personas it is possible to target profitable segments of large audiences with granular targeting.
Online advertising is even better because you can reach millions of people each day. Facebook boasts almost three billion active monthly users. Google receives around 63,000 queries per second. Google is the only advertising medium that allows your average business to reach this large audience.
To reach the right audience, you won't have to spend millions on advertising fees. Online advertising costs are much lower than traditional advertising which can run for over $100,000 to produce a 30-second TV advertisement.
Online advertising costs only $3-10 per 1000 people, while traditional methods cost $22 for 1000 people. Your mom-and-pop retailer may not be able to afford a TV advertisement, but they can manage a successful online campaign via Facebook, Google, and any other channel.
Online advertising can be cost-capped. Most online advertising platforms allow you to set a budget and limit your maximum spend so that you don't overspend.
Traditional advertising formats like radio, TV and print are difficult to track how successful your campaigns were. Online advertising is different. Most channels will show you how effective your ads were.
Online advertising channels typically show how many people clicked on your ad and how many sales it generated.
This data is gold. It allows you to determine ROI and see if your online advertising is producing a return.
You can also use this data to optimize and increase the profitability of your campaigns. It will allow you to understand the performance of your ads and help you make changes to increase your ROI.
Online Advertising Options for Businesses
Here are the most important types of online advertising that you should be aware of
1. Paid Search
Paid search is an important channel for online advertising. A search engine is the most common online interaction. This makes it an excellent place to target potential customers.
Google is the leader in paid search advertising. This is not surprising considering it has an 85 per cent global market share .
Paid ads can be purchased in pay per click or CPM models. Pay per click is where brands are paid every time someone clicks their ads. CPM is a cost-per-view system that allows brands to pay a fixed price per thousand views.
As you can see, they are often located at the top of search results pages. They can also be found at the bottom of search result pages or in separate tabs like the Shopping tab.
Paid search provides the best targeting for online advertisers. Brands can target certain keywords, locations, devices, or other parameters. This allows brands to target specific keywords, destinations, devices and more.
However, this comes with a price. Paid search ads can be some of the most expensive. Google Ads' average CPC is between $1-$2. In certain industries, such as law, average CPCs can be much higher.
- huge reach
- Fantastic targeting
- Instant results
- High intent traffic
- It can be very expensive
- Not visual ads
- Highly competitive
2. Advertising on Social Media
Social media advertising is huge. It is the second largest digital advertising market, with $153.7 billion in revenues in 2021. This is expected to rise to $252.6 billion by 2026.
Social media is a popular medium for consumers. Social media is used by more than half the world's population. The average user uses it for 2 hours 27 minutes each day.
Each major social media platform offers advertising, including:
- Facebook (now Meta).
The format of an ad will vary depending on which platform it is, but most will be an in-feed ad. Facebook has four major ad formats.
The platform will affect the cost of social media advertising. WebFX's table shows that Instagram and LinkedIn are the most expensive platforms, with an average CPC of over $3. Twitter and Facebook are the most affordable.
- insane targeting
- wide audience reach
- It is effective in increasing brand awareness and sales
- Some channels are low-cost
- On popular channels, costs can be high
- There is a lot to choose from
- It can be difficult to find the right platform
- Apple may be tracking your updates and causing problems
3. Native Ads
Native ads don’t feel like ads. Publishers and brands partner to create sponsored content that offers a lot of value for the reader, while also subtly promoting their business. The content is posted on the partner's website and distributed as usual. Users will be able to read the content and gain value without feeling sold to. It's a win/win situation.
Here's a sample of a native ad from Fast Company. You will notice the “paid content disclaimer” in the upper right-hand corner.
Native ads can be extremely effective.
Research has shown that native ads have a soft touch and can generate five to ten times more CTRs than direct responses ads. However, native ads can be costly. For a feature in major publications, it can cost as high as $200,000
Most major publishers offer sponsored content or native ads packages. This makes it simple for your brand to be featured in many high-quality publications.
- Build trust
- appear authentic
- High effort required
- Investing typically yields lower returns
4. Display ads
One of the most popular forms of online advertising is display advertising. It's the most common form of online advertising. There are many types of display ads: banner ads, sidebar ads and popups.
Here is an example of a Digiday banner display advertisement.
Brands have many options for executing these ads. These platforms are popular:
- Google Display Network
- Facebook Network Ads
Display ads can be one of the most cost-effective online advertising methods, with clicks as low as $0.50. However, there is a tradeoff as display ads often have the lowest CTRs than any other online ad.
- Widely available
- Great for brand awareness
- Low CTRs
- tend to be ignored, or even blocked
- Poor UX is often linked
5. Retargeting Ads
Retargeting ads work better than traditional display ads.
This is because customers rarely buy from your site the first time they visit it. If you show them products they have already seen, they will be more inclined to make a purchase.
Retargeting ads are a great way to do this. This type of display ad targets only people who have visited your site and not made a purchase.
Retargeting ads are available on all websites that display display ads. Retargeting ads cost will vary depending on the location they are displayed. Retargeting ads on Google is usually priced between $0.66 and $1.23 per click. Display retargeting advertisements will be cheaper.
- Only target people who are interested in your brand.
- Display ads have a higher CTR than banner ads.
- It can be intrusive
- harder to run after privacy updates
6. Affiliate Ads
Affiliate advertising is when a brand partners up with an influencer or publisher to promote its products and services. Instead of an upfront payment, the third-party is paid a commission for each customer they refer to the brand.
Affiliate advertising is an extremely growing market that is expected to reach $8.2 Billion in the U.S. by 2022.
Costs of affiliate marketing vary depending on your industry and the partners you choose to work with. Commission rates range from $3 to $200. They can be as low at 1% per sale as high as 60%.
- Only pay if you make a sale
- It's easy to get started
- Many third-party publishers and agents
- It is possible to offer a large portion of the commission.
- It can be difficult to keep up with affiliates.
7. Video ads
Video ads are a popular form of video-based advertisement. YouTube ads are the most popular form of video advertising, but there are also ads on other video platforms, such as Vimeo.
Video ads have a huge potential to reach a wide audience. YouTube alone has more than 1 billion hours of video per day. YouTube is also the second most popular social network platform and second-largest search engine in the world.
These ads are also cost-effective. YouTube ads cost around $2000 to reach 100,000 people.
- Ads tailored to video topics
- Multiple ad variations
- Specific targeting options
- broad target audience
- Must create a video advertisement
- Some ads can be skipped
How to Make an Online Advertising Strategy For Your Business
No matter what your product or service, the steps involved in creating an online advertising strategy are similar. First, you need to set goals and define your target audience. Next, you will need to allocate a budget. Next, choose a channel and make ads. It's then a matter of optimizing and launching as needed.
Step 1 – Set Goals
Online advertising campaigns should have clear goals. You will be more successful if you have a clear understanding of your goals and how to measure them.
According to one study, 76% of those who set goals and made a list with actions and then ran weekly progress reports on their accomplishments achieved them.
While increasing sales is the most common goal of an online advertising strategy, it is not the only one. Other goals include:
- Increasing brand awareness
- Getting more subscribers
- Increasing your social media followers
No matter what your goal may be, ensure it is SMART (specifically measurable, achievable and relevant) within the time frame.
Instead of saying that you want new customers through your Google Ads campaign you should state that you would like to acquire 1000 customers per month by spending $5,000 on ad campaigns.
Step 2: Find Your Target Audience
Once you have a goal, it is time to choose your target audience. Who do you want your ads to reach?
Online advertising has the advantage of targeting a very specific audience, as we have discussed. Now is the time to capitalize on that. Take a look at these:
- Location or nationality
Be realistic about your goals. You will need to reach a wide audience if you are looking to attract tens of thousands of customers. You can be more specific if your goals are less ambitious.
Step 3 – Assign a Budget
It is crucial to set a budget for your online advertising campaign. This will determine how much money you can spend on advertising and, in a smaller way, what channels you can advertise. Your budget should be based on many factors.
- your overall marketing budget
- Your product or service price
- Your goals
- How long do you want the campaign last?
- Any previous results
It's not a good idea to spend all your budget on one campaign. You don't want to allocate a small budget for a campaign that will run for six months.
Although it is important to establish a budget in advance, you should be open to adjusting that budget as needed. Online marketing offers another benefit: you can see results immediately. You should also be ready to increase your budget if you experience success.
Step 4 – Choose a Channel
Once you have established a list of goals, a target audience and a budget you can decide on the channel to advertise on. You probably already have a paid channel in your mind.
It's okay. But it is important to ensure that it meets your goals, budget, audience, and objectives. Google Search advertising can be very expensive for some keywords.
The average price per click for keywords in the insurance industry was 20.12 in 2021 , for instance. You should consider switching channels if you don't have enough budget.
If your goal is to grow your social media followers, advertising on Google doesn't make sense. If most of your customers prefer TikTok, you can advertise on Facebook.
Stick to one channel if you're starting an online advertising campaign for the first time. This will make it easier to create ads and set up campaigns. After you have run a few campaigns, you can advertise on several paid marketing channels.
Step 5 – Create ads and launch your campaign
The steps will vary depending on the paid ad channel. For Google Search ads, the ad copy will need to be written. You will need to create an image for display ads. No matter what channel you use to advertise, this is where the majority of your effort should go.
If you advertise on Google Ads, for example, improving your quality score can make a big difference. A Quality Score is a measure how relevant your landing page and ad are. An above-average score can lead to a 50% discount on your cost per Click. You could pay four times more for low-quality scores.
As I explain in my adcopy guide, spending time to improve your ad copy can increase clickthrough rates.
Step 6 – Optimize Your Campaign
Launching an online advertising campaign is not the end of the process. These channels offer a wealth of data so you can optimize your campaign quickly.
Every day, review your ad dashboard and find ways to improve your campaign. These are some of the most common strategies:
- Modifying your bid amounts
- changing ad run times
- adding negative keywords
- Change your copy
- Change images
- Change an ad that targets a different segment in your audience
If things don't go according to plan, you can pivot the campaign completely. It's not worth spending money on campaigns that don't generate any returns. Instead, choose another channel to launch a campaign.
Do not be alarmed if you find this section overwhelming. An online advertising agency can handle this entire process for your benefit.
Online Advertising Strategies to Take Your Strategy To the Next Level
Your first online advertising campaign is only the beginning. After you have launched a few campaigns, you can experiment with more advanced strategies such as the ones below to increase your success.
Enhance your Ad Campaigns
Online advertising is affordable. You don't have to spend more than your budget. You can find marketing tools that will enhance your campaign and increase your ROI.
These tools should be used wherever possible. Ubersuggest is my keyword research tool and can be used to improve your paid advertising campaigns. It has access to high-quality keyword data. This tool is great if you want high-quality keyword data to ensure you are targeting the right keywords in your Google PPC campaigns.
Go to Ubersuggest. Click on the keywords dropdown. In the “Discover new keyword” bar, type a keyword. In this example, I will use the keyword “digital agency”.
You can search for keywords and get hundreds of related ideas. The keywords can be exported as a CSV file, and added to Google Ads instantly. You can also filter the keywords to make them more relevant.
Let's say, for example, that I don’t want to target keywords with a CPC greater than $20. Clicking on the CPC filter will allow me to filter them all by entering values between $0 and $20.
This is just a small part of the many things you can do using a tool such as Ubersuggest. You can find more information in my Ubersuggest guide.
Automated PPC Bidding
If you aren't confident setting bids or optimizing campaigns, automated bidding can be a lifesaver. Google is the most well-known platform for automated bidding. However, many other platforms like Microsoft and Facebook also offer smart or automated bidding services.
Google offers two types of automated bidding services: one that is standard and one that is smart. The smart bidding service uses machine learning to maximize conversions. Google's automated bidding service allows you to target five goals.
- Google will increase site visits by generating as many clicks possible.
- Google will increase visibility by focusing on impression share so that your ads appear at the top of the page.
- Maximize conversions in your CPA: Google will drive maximum conversions at the Target Cost per Acquisition.
- Google will strive to maximize every click's value by setting a target ROAS.
- Maximize conversion bidding. Google will do everything possible to maximize your conversion value, while still spending as little as possible.
Automated bidding has two benefits. Automated bidding is advantageous in two ways. First, it takes away the responsibility of setting the correct bids so you can concentrate on other aspects of the campaign. Google will likely do a better job setting bids than yours.
TMobile, for example, increased conversions by 22 per cent, decreased cost-per-acquisition by 27 percent and increased conversion rates by 23 percent when it switched to automated bidding via Google.
Facebook Hyper-Personalized Ads
Every marketing strategy should include personalization. This applies to your online advertising campaign as well. A personalized experience is said to increase repeat customers by 60% of customers.
Facebook's dynamic formats and creative solutions make this possible.
You can create an individual experience for each person who views your ad by using dynamic formats and creative. Facebook will modify certain elements in your ad automatically to match the user's preferences. These elements include:
- Facebook will display either the collection or carousel format.
- The description is Additional information such as price and delivery information might or may not appear.
- Media and creativity: Dynamic Video can be used to generate auto-generated videos from your product catalogue.
- The destination:Facebook can send people to different destinations based on where they are most likely to convert.
Hyper-personalized online ads can have huge benefits. Facebook tested 12 online stores with dynamic formats and creative solutions and found that they resulted in increased sales, add-to carts, purchases and views. The incremental ROAS increased by 34%, the lift was 10 percent higher, and incremental purchases were cheaper by six percent.
Retarget New Customers
Retargeting strategies primarily target consumers who have visited your website but have not yet made a purchase. Let's turn the conventional wisdom upside down and concentrate on converting customers that have already purchased from you.
The theory is that it costs five times more to acquire a customer than to retain an existing one. It's better to convert existing customers than to acquire new ones.
These messages can also be delivered via retargeting ads. An IAB survey found that 92 percent of marketers believe that retargeting ads perform as well as search. 91 percent think they perform as well as email and 92 percent think they perform as well as other display ads.
What are the best ways to re-target customers Three strategies are suggested by me:
- Cross-selling Show them products that are similar or related to the first purchase.
- Encourage them to upgrade or purchase add-ons.
- Subscription Encourage them to convert their one-off purchase in to a subscription
Try Under-Utilized Platforms
Bad news! Everybody is advertising on Facebook. Your competitors may also be advertising on Google. Display ads are the same. Advertisers with larger budgets will target the exact same audience as you and use the same keywords. This is not a good sign for you.
You can stand out from your competition by creating better ads and optimizing campaigns. However, it is easier to advertise on platforms that are not used by your competitors.
You can run search ads instead of Google on Bing, DuckDuckGo or Google. For more information, see my guide to Bing.
There are many other ad platforms out there that don't get the attention they deserve. Quora is a great source of highly targeted and engaged users who are ready to be served amazing ads. Motley Fool Australia used Quora for increased leads by 111% , and lower CPAs of 47 percent, in.
My guide to Quora can be a great place for you to start.
Online advertising for business Frequently Asked Questions
How much of my marketing budget should I allocate to online advertising?
Your marketing budget should not exceed 2 to 5 percent of your total revenue. Your other marketing strategies, as well as your success with paid advertising, will determine how much of your budget you allocate to online advertising. Online advertising will be more affordable if you don't use any other marketing strategies and you are more successful with paid ads.
What is online advertising?
Any form of internet-based marketing that is paid for can be called online advertising. This includes PPC, social media advertising, banner ads and display ads as well as video ads and other formats.
Which type of online advertising is best?
There are many types of online advertising. Online advertising should be the best for your brand and your audience.
Which types of businesses should advertise online?
Online advertising is a must for any business that has an online presence. Online advertising is cost-effective, highly targeted, and highly measurable. This makes it very easy for businesses to get started.
Conclusion: Online Advertising for Business
Online advertising is a powerful marketing strategy. It is cost-effective, simple to measure, and accessible for virtually all businesses, large or small. This article should have shown you how simple it is to get started.
Once you are familiar with the various paid marketing channels, I will guide you through creating your first online advertising campaign. Once you feel comfortable with the basics, you can experiment with new strategies to elevate your online advertising campaigns.
What channel do you prefer for online advertising?
By: Neil Patel
Title: Online Advertising for Business: Creating the Perfect Plan That Gets the Customers You Want
Sourced From: neilpatel.com/blog/online-advertising-for-business/
Published Date: Fri, 22 Apr 2022 22:00:00 +0000