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The showdown: display ads vs. search ads

Published Aug 10 2023 6 minute read Last updated Jun 18 2024
display ads vs. search ads
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  • Sean Dougherty
    Written by Sean Dougherty

    A copywriter at Funnel, Sean has more than 15 years of experience working in branding and advertising (both agency and client side). He's also a professional voice actor.

Display and search ads are two of the most popular types of advertising available to marketers today. They can be quite diverse, low cost, and are complementary strategies of each other.

But how do you know which strategy should receive the majority of your focus and ad spend? Or, should they receive equal treatment? 

Today, we’re going to break down each of these strategies and provide you with a better idea of how to make the most of them. Then, you can make a more informed decision for your own marketing plan. 

 

What are display and search ads?

One of the biggest differences between display ads vs search ads is where they appear on the internet. 

Display ads

Display ads are paid placements that appear on websites, blogs, social media platforms, and apps. They let you promote your brand across multiple digital properties, increasing awareness about your products and services to your target audience. 

Display advertising can be quite versatile and help you reach your audience at different stages of their buying journey. For example, you can promote your product on a third-party website and encourage people to visit your online store, or show ads to people that added items to cart but never completed the purchase. 

While search ads are text only, display ads often incorporate visual and interactive elements that can catch the eye of prospects and lead them through your sales funnel. For example, a display ad might include video content that encourages viewers to click on the ad. That means display campaigns can have more impact than search ads. It's like the adage: "a picture is worth a thousand words."

There are many types of display ads, including:

  • Banner ads
  • Video ads
  • Interactive ads
  • Animated ads
  • Expandable ads

Search ads

Search ads are advertisements in search engines. For example, the ads that appear at the top and bottom of organic search results in Google. 

These ads have three elements:

  • Headline: A short sentence about your product or service
  • Description text: A brief explanation of your offering
  • Display URL: The website address that appears with your ad

Google also lets you include additional information in search ads with ad extensions. These extensions include call buttons, product pricing, and product features. 

Search ads help you target search engine users actively looking for information on the internet. They can be a powerful way to drive these users to your website, increasing traffic and brand awareness. 

 

Display ad vs. search ad models

While the formats of display and search ads can differ, so too does their pricing and functionality model. 

Search ads are often billed on a pay-per-click basis. That is, whenever someone clicks on one of your search ads, you are charged. Display Advertising, on the other hand, is typically bought based on impressions and reach. This model is called cost-per-mille (CPM) – or, cost per thousand impressions.

While CPC and CPM use different pricing models, they can employ a similar auction-based sales model – albeit with slight differences. For instance, CPC ad networks may auction off ad space around specific keywords with pricing based demand, quality scores, and click-through rates. 

CPM networks tend to auction off ad space around context, then base their pricing off who is willing to pay most for 1,000 impressions. As you might imagine, highly sought after contexts (say, Taylor Swift related goods) can demand higher rates than more niche contexts (perhaps miscellaneous washing machine parts). 

Recommended reading: The experts guide to retargeting - 2023 edition

 

When to use search ads, display ads, or both

When setting your display vs. search ads strategy, you’ll want to ask yourself a few core questions: 

Do customers search for your brand or product?

Search ads are great if you have products or services lots of people are looking for on search engines. For example, a locksmith in Boston can invest in search ads by bidding on popular keywords such as "locksmith Boston." Doing so increases the visibility of their business on search engine results pages for these keywords. People who are in active need of a locksmith will see their ad at the top or bottom of organic results and click on the ad if they want to learn more. 

So what happens if you have a lesser-known product or service that not many people are searching for?

Let’s say you created a new, groundbreaking product for dogs. Since you've basically just invented it, your potential customers may likely not be aware of it – and likely not search for it. With display advertising, you can run your ads on websites and communities about dogs, dog training, and pets in general, thereby putting your product in front of the best possible audience. This allows you to target people as they move across different websites and social media platforms. 

In many instances, you might want to use a combination of display and search ads. It all depends on your marketing campaign. Investing in both ads can increase your reach and expose your offerings to as many people as possible. 

As always, you need to consider your audience and how / where they may interact with your brand. 

How do customers buy your product?

Search ads can be particularly powerful when used in conjunction with an e-commerce website. Imagine your own online behavior. You search for a solution to a problem, and one of the search ads seems to fit your needs perfectly. You click on the link, add the item to the cart, boom.

Brick-and-mortar retailers may want to opt for display ads, though, since they can repeatedly raise awareness for your brand and deliver information on where to buy the product. 

Meanwhile, if you’re a modern brand in the fast-moving-consumer-good (FMCG) space, you will likely use a hybrid approach: use display ads to build awareness and search ads to drive a sale online. 

Where in the customer journey is your audience?

Because display ads increase awareness about your brand or product, you can use them at the earliest stages of the advertising funnel. Search ads, on the other hand, encourage people to visit your website and make a purchase. So it's a good idea to use this ad type later on in the buyer's journey. 

Not everyone will purchase your product after clicking a search ad. Therefore, you can also use display ads to remind customers about your product after visiting your website. A combination of search and display ads also suits long customer journeys, such as those that involve purchasing an expensive product like a car. You can increase awareness about your product over time with different display ads, then use search ads to drive more qualified traffic to your site. 

 

How to set up display advertising vs. search advertising campaigns

You can purchase both search and display ads through advertising networks. As Google's search engine market share was 91.88% in June 2022, we'll focus on how to set up campaigns on this network. 

 

Creating a campaign in Google Search Network

Google has two main advertising networks: Google Search Network and Google Display Network. We will first set up search ads on the Google Search Network via Google Ads, which is a simple process:

Create a new campaign

Click the Campaigns icon in your Google Ads account, then click on the Campaigns drop-down menu, and then click Campaigns. Create a new campaign by clicking the plus icon.

You'll need to choose a goal for your Google search ads campaign: sales, leads, or website traffic. You can also add information about your business and name your campaign. 

Customize campaign settings

Now, you can choose the type of people you want to target with your search ads and how much you want to spend on ads via a bidding strategy. Google Ads will guide you through this process and inform you of any issues that might impact your campaign before you publish your ads. 

Create ad groups

The next step is to set up different groups of ads. Each group will be based on what people interested in your offerings are searching for online. Google uses the following example for ad groups:

"Let's say you own a furniture business. You might create an ad group named 'Couches' where you’d target keywords like 'leather couches,' 'sofas,' and 'loveseats.' You’d then create ads 

about couches and link to the couches section of your website."

Design your ads

Next, you'll create your ads from scratch on Google Search Network. You'll enter the display URL, headline, and description text for your ad based on the keywords you want to target.

Google recommends you create three ads for each group. 

Select your budget

Your budget will determine how many people see your ad on search engine results pages. Google Search Network lets you add a daily budget for search ads. 

Recommended reading: Behavioral vs. contextual targeting: the difference explained

 

Creating a campaign in Google Display Network

Setting up display ads via Google Display Network is just as simple. Follow these steps:

Create a new campaign

Click the Campaigns icon in your Google Ads account, then click the Campaigns drop-down menu, and then click Campaigns. Create a new campaign by clicking the plus icon.

You'll choose a goal for your search ads campaign: sales, leads, website traffic, or brand awareness and reach. You can then add your website URL and enter a name for your advertising campaign. 

Customize campaign settings

Next, choose the geographic locations where you want your ads to appear. You can also exclude locations you don't want to target. For example, if you only ship products to customers in the contiguous USA, you can prevent your display ads from appearing in Hawaii or Alaska.

You can also choose the languages you want to target with your ads.

Create your budget

Follow the on-screen prompts to create your budget. As mentioned before, display ads work on a CPM basis. Google will help you determine your budget for ads and can automate smart bidding strategies, meaning you don't need to bid for advertising space manually. 

Choose a targeting strategy

Now, you can choose which customer types to target with your ads. Google can find the best-performing segments with its optimized targeting feature, or you can manually select targeting signals based on your campaign goals. 

 

What you should know about search ads vs display ads

Search and display ads both help you to promote your products and services online. While the strategies work well independently, they can work even better together. 

Before allocating spend to either strategy, be sure to plan out your campaign ahead of time. That means taking an honest look at your audience, whether they know about your brand, how they can make a purchase, and more. Then, don’t be afraid to start small. Run a few experiments to see what works, collect and analyze your data, and test some more. 

 

Disclosure: the featured image for this article was created using generative AI. 

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