Advertising Campaigns with In Text Ads

The Online Advertiser Advantage

The advertiser’s fantasy has always been a medium where highly targeted potential customers seek specific information and knowingly choose to get exposed to ads. Sponsored search ads fulfilled this fantasy. When people search online, they are looking for specific information, their location and some other characteristics are known, and they’re willingly clicking on search results – including sponsored ads. This explains the phenomenal success of Google AdWords for both advertisers and Google.

In the online world, display ads, mostly in the form of banners, represent the opposite end. Much more like in traditional media, banners need to interrupt potential customers while they’re doing something else. Like TV ads, they ask the potential customer to stop enjoying the content she’s interested in, and pay attention to paid-for messages. This is why advertisers need vast exposure of banner ads to get to results and so we price display advertising by the thousands.

From the advertiser’s point of view, in text advertising is much closer to search ads than to display. While people are asked to pay attention while they are doing something else (mostly reading), they are not actively interrupted like with jumpy banners. Only an interested reader will hover with the mouse to see what ad is related to the highlighted double underline term. And then, after viewing the ad, only if there’s still interest, the reader will click and a charge to the campaign will be made. This means that advertisers pay only after the potential customer has given permission to get exposed to the ad’s message. In fact, the potential customer gave her permission twice – first with the hover and then with the click. This explains why in text ads come very close to advertisers’ fantasies about permission marketing.

What to Expect: CTR, Bounce Rates, and Conversion

The high engagement of potential customers with ads that they have knowingly chose to view leads to relatively high conversion rates. Clearly, conversion depends on many factors and there isn’t a specific number that can be projected for all ads and products, but you can expect higher conversion rates than with display ads and results that are closer on the spectrum to search ads. True, the conversion rate will not be as high as with search ads, but the cost per click could be significantly lower and the click through rate higher, so the overall results should get very close.

In text ads yield more clicks or as we tend to call it – a higher click through rate (CTR). In text advocates explain the higher CTR with the smart algorithms that highlight the most relevant terms. While this is true, there is another explanation. In text ads are still relatively new. While online dwellers got used to banners and they mostly disregard them, in text ads still attract more attention. With the growing penetration of this new method of advertising, the initial interest in the new format will decline. Then, the genuine interest in the advertiser’s message will remain to justify the click rate, which will probably be a little lower, but still much higher than with display ads.

An unfortunate side effect of the high click through rate that stems from interest in the format itself – as opposed to the interest in the ad’s content – is a higher bounce rate. As an advertiser you should expect more visitors that leave your landing page quickly. These visitors were probably mostly interested in seeing how this new type of ad works. While this behavior should decline with time, it still affects your results negatively, so you should anticipate it and include it in your calculations. And yet, despite the higher bounce rate, the genuine interest of most visitors and the relatively low click costs will yield high conversion rates.

Tips to Improve Online Advertising Results

When you first launch an advertising campaign with in text ads, please do your homework. Simply copying your AdWords campaign will work but it won’t maximize your potential results. One major difference is the keywords format. While for sponsored search results you try targeting what people are searching for, in text hooks – those double underline links – are part of written text. Think about it when you do your keyword research.

Also, keep in mind that the in text bubble is limited to a single ad. There are formats that allow more ads, but the limited space and attention leads to one ad per hover de facto. This means that you can’t set your cost per click (CPC) aiming for mid-level or lower-end results. Since only one ad will be placed, your CPC calculations should aim at the first place. Among other things, try adding just a little to your CPC, as an ad with 11 cents usually stands a better chance than an ad with a round price of 10 cents.

Due to the temporary issue with higher bounce rates (see above), keep your landing pages as clear as possible. This way, visitors who are new to the in text format will not be confused. Help them understand where they got to and easily identify your call for action. This tip is clearly relevant to all online advertising, but it’s more important with new advertising methods.

For the last tip to improve your advertising with in text ads I must first apologize. I’m going to recommend working with direct in text providers, but I also work for one of those. So, you can disregard this tip, but you can also consider it together with the reasoning. I work with most textual CPC marketplaces and those ad networks are doing an amazing job in getting potential customers and advertisers together. It’s true that they take their share of the CPC and you could bypass them, but I think they bring real value to the table. That’s not the reason why I recommend working directly with the in text providers. The ad networks’ systems were tailored to search results and to AdSense like contextual programs – both of which place several ads each time. Their pricing mechanisms and other technical filters find it difficult to maximize results from in text ads. For the time being, I therefore recommend that advertisers try working directly with in text providers. I also recommend (and work on it) that the ad networks improve their compatibility with in text advertising, so that everybody can be happy.