Click-through rates (CTR) for search ads on commercial intent queries can often be hundreds of times higher than the CTR for display ads on a typical Facebook page. What is the explanation for this incredible difference in performance?
Clicks derived from targeted search ad results are highly effective due to their commercial, behavioral and temporal relevance – they correspond exactly to what the user is looking for at that very moment. Facebook ads and display ads in general are often not aligned with users' interests and may even be disruptive to the overall user experience. Most of the web’s display inventory is generated within a non-commercial context, often making a slight disruption of users’ experiences with display advertising inevitable.
What can be done to improve the relevance and response rates for display ads?
Performance of display advertising can be drastically improved through the use of intent data. Intent data is generated by obtaining an explicit expression of the user’s commercial intent – meaning that the user is currently in the market to purchase a given good or service. As an example, knowing that a user is interested in purchasing an airplane ticket from London to Barcelona a week from now would be considered intent data.
Showing display ads for airline tickets to Barcelona to a user that is currently looking at buying a Spanish holiday package or showing auto insurance display ads to a user that is looking at switching insurance providers leads to much higher response rates and engagement for the advertiser, all the while improving user experience. We often see intent data generate conversion rates and click-through rates that match the performance of advertiser retargeting or even occasionally exceed it for automotive and travel advertiser verticals.
How do we obtain intent data for display advertising?
Data aggregators like BlueKai and Exelate can generate intent data by placing pixels on the pages of online publishers. A user is indicating purchase intent if, for example, she has added goods to a shopping cart, compared prices on mobile phones, calculated a mortgage loan, checked airline ticket prices, etc.
Search retargeting data aggregator Chango goes one step further by turning display into search with intent data. Chango captures referrer data search terms through a network of publishers which set cookies on users arriving from search engines. Just as in a search, advertisers can then match their display ads to the specific keywords the user has searched for.
Therefore, intent data is an indispensable aid for advertisers seeking search-like performance in display advertising.