What Display Advertising Is (And Why Most Businesses Get It Wrong)
Display advertising puts small ads on websites across the internet. You've seen them: banner ads on news sites, product carousels on content pages, text ads in sidebars. These aren't search ads (Google Ads when someone searches for you). These are ads appearing on other people's websites, showing your message to potential customers.
Most small businesses avoid display ads because they seem expensive or ineffective. This is because most businesses run display campaigns poorly. They target too broadly, use bad creative, or set unrealistic expectations about immediate ROI. Run display ads correctly, and they become one of your most efficient marketing channels.
Display advertising excels at three things: building brand awareness (getting your name in front of people), remarketing (showing ads to people who visited your site), and driving traffic at low cost (display CPCs are typically £0.50-£2 vs. £3-£15 for search).
How Display Advertising Actually Works
Google's Display Network (GDN) is the primary platform for display ads. Google partners with thousands of websites (news sites, blogs, forums, YouTube, Gmail) and serves your ads to their visitors.
You create a campaign specifying who you want to reach (keywords, interests, demographics, past website visitors) and how much you'll pay per click. Google's algorithm shows your ad to matching visitors across its partner network. When someone clicks, they come to your website.
The key advantage is reach. Google's Display Network reaches 90% of internet users. Your search ads reach only people actively searching for you. Display ads reach people browsing websites in your industry, showing them your message before they even know they need you.
Remarketing is where display advertising becomes truly powerful. Someone visits your website, doesn't purchase, and leaves. Remarketing ads follow them across the internet, reminding them about your offer. Remarketing drives conversions at exceptionally high rates because you're showing ads to people who already showed interest.
A visitor to a law firm's website might leave without calling. That firm's remarketing ads follow that visitor to news sites, Gmail, YouTube, and other destinations for the next two weeks. Remarketing converts 5-10% of those remarked visitors, far higher than cold display ads (which convert 1-2%).
Display vs. Search Ads: Understanding the Difference
| Factor | Display Ads | Search Ads |
|---|---|---|
| Intent Level | Lower (awareness stage) | Higher (ready to buy) |
| Cost Per Click | £0.50-2.00 | £3-15+ |
| Conversion Rate | 1-3% (cold), 5-15% (remarketing) | 3-8% |
| Reach | 90% of internet users | Monthly active searchers only |
| Best For | Brand building, awareness, remarketing | Direct response, conversions |
| Frequency Needed | Multiple exposures build effect | Single exposure sufficient |
The comparison shows why both are essential. Search ads capture high-intent users ready to convert. Display ads build awareness and reach users earlier in their journey. Most effective campaigns use both.
Pro Tip: Remarketing Lists for Search Ads (RLSA)
Google allows you to show different search ads to people who have previously visited your website. These people convert at 3-5x higher rates than cold searchers. Create remarketing-specific search campaigns with more aggressive bids and landing pages optimised for repeat visitors. The conversion rate difference is dramatic.
Types of Display Ads and When to Use Each
Responsive Display Ads are the simplest and most common. You provide headlines, descriptions, images, and logos. Google automatically creates multiple ad variations and serves the best-performing ones to different sites. Responsive ads work because Google optimises them for different sizes and placements automatically.
Image Ads are custom-designed banners in standard sizes (300x250, 728x90, 160x600 pixels). These work well when you have professional creative and want consistent branding. Image ads typically outperform text on visual-focused sites.
Video Ads appear on YouTube and video partner sites. Short video ads (6-15 seconds) perform well for product demonstrations or explainer content. Video CPMs (cost per thousand impressions) are lower than search and drive strong engagement for video-appropriate products.
Native Ads blend into the content of websites rather than appearing as obvious ads. They perform exceptionally well because users don't perceive them as advertising. Native ads are more expensive than display but drive higher click-through rates and better brand perception.
Shopping Ads appear on Google Shopping and Display Network, showing product images, prices, and ratings. These work for e-commerce businesses and drive high conversion rates because they show products directly.
Building an Effective Display Campaign: Step by Step
Step 1: Define Your Audience
Who do you want to reach? A plumber targeting homeowners needs different audience targeting than a B2B software company targeting IT managers. Google offers several targeting methods:
- In-Market Audiences - People currently researching your type of product/service
- Affinity Audiences - People interested in your industry or category
- Custom Intent Audiences - People searching for specific keywords or visiting relevant websites
- Demographic Targeting - Age, gender, parental status, household income
- Remarketing - People who visited your website previously
Start with remarketing to previous website visitors—this is easiest and converts best. Then expand to in-market audiences in your category.
Step 2: Create Compelling Creative
Your ad creative (images, headlines, text) determines success more than anything else. Weak creative wastes budget regardless of targeting. Follow these principles:
- Use clear, benefit-focused headlines ("Save £500 on your marketing costs")
- Include a strong visual—photos of real results outperform generic stock images
- Make your CTA clear ("Download now," "Get free quote," "Learn more")
- Use contrasting colours and readable fonts
- A/B test multiple creative variations
Step 3: Set Realistic Budgets
Display advertising works on volume. With a £1000/month budget, you'll reach roughly 500,000-1,000,000 impressions (depending on targeting precision and audience competition). From those, you might get 2000-5000 clicks and 20-150 conversions.
Don't expect immediate ROI from cold display ads. Display advertising typically shows strong ROI after 3-4 months of consistent campaigns building brand awareness and generating remarketing audiences. Remarketing campaigns show strong ROI within weeks.
Step 4: Monitor and Optimise
Track click-through rate (typical 0.5-1.5%), conversion rate, and cost per conversion. If CTR is below 0.5%, creative isn't resonating—test new headlines and images. If conversion rate is below 1%, landing page optimisation is needed.
Pause underperforming placements and audiences. Scale successful ones. Display campaigns improve substantially with optimisation over 4-8 weeks.
Display Advertising ROI: Setting Realistic Expectations
A business spending £2000/month on display advertising might see:
- 1-2M impressions
- 4000-6000 clicks
- 40-120 conversions (depending on product and landing page quality)
- 10-20 customers acquired (if conversion rate is 25-50%)
If average customer value is £500, you've acquired £5000-£10000 in customers from £2000 in ad spend. That's 2.5-5x ROI.
More importantly, these customers are building brand awareness. They'll see your ads again, follow your social media, and recommend you to others. The long-term value exceeds immediate conversion metrics.
Display advertising is most cost-effective when combined with Google Ads management that integrates remarketing lists and audience strategy across all channels. Or start with a free audit to understand if display advertising suits your business model and budget.
The Verdict: Display Advertising Is Underutilised Brand Building
Most small businesses skip display advertising because they don't understand it or run campaigns poorly. This is a strategic error. Display advertising reaches more people at lower cost than search ads, builds brand awareness efficiently, and drives remarketing conversions at exceptional rates. Start with remarketing (showing ads to previous website visitors), then expand to cold audiences once you've proven the channel works. With proper creative, targeting, and optimisation, display advertising delivers strong ROI—especially when you account for brand building benefits beyond direct conversions. Allocate even 20% of your PPC budget to display ads and watch awareness and traffic improve within 60-90 days.
Brett Dixon
Founder & Managing Director of DPOM. Brett founded DPOM nearly 15 years ago after a career in marketing working with Harvey Nichols, BBC Top Gear, Formula One circuits, and UK Trade and Investment. His passion became helping smaller businesses grow — with honest advice, no jargon, and realistic expectations.
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