Display Will Overtake Search

Data-Driven Thinking“Data-Driven Thinking” is a column written by members of the media community and containing fresh ideas on the digital revolution in media.

Today’s column is written by Amiad Solomon, Founder & President at Peer39.

Over the past ten years, the search advertising industry has grown tremendously. In no small part due to companies like Google and Yahoo, advertisers have largely formed their online footprint with text-based ads adjacent to contextually relevant search results. This approach was long perceived to be an advertiser’s best friend from an ROI perspective, and it was also safe and simple. However, I believe display advertising will steal the mantle from search as the most effective and efficient strategy on the web.

The shift in balance is largely attributable to the vast improvements that have been made in display targeting technologies in the past year. Additionally, brands can target display ads on a very granular level and create a safe environment for their brands. Now, it’s safe to come out and play.

Advertisers are seeing greater bang for their buck using display in an increasing number of content categories. With search advertisements, if an advertiser wants to appear alongside automotive results, the CPC will likely be upwards of $5, and very often more than $10. However, with display, that same spend can get an advertiser thousands of relevant auto impressions. And given the increased click-through and conversion rates that brands are seeing, that ROI is massive compared to search.

Campaign performance levels that were seen as successful only a few years ago in search are now better in the display field. It is my belief that brands who are willing to take the leap from search to display will see huge jumps in their campaign performance, as they target to relevant categories which serve as a proxy for their target audience and align with their brand and creative messages.

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  1. Mike Blacker

    Nice to see predictions like this. I agree that display has the potential to overtake search as technology improves and brands start to follow eyeballs.
    Response based advertisers will always want CPC/CPA campaigns, which doesn’t work as well in display. The tide begins to shift as large consumer brands like P&G, Unilever, Target and Walmart start to see more accuracy in demographics and geolocation.

  2. The channel allocations may change a bit as ad tech data gets more usable, but if you’re thinking your budget needs to go to search OR display you’re doing it wrong.

  3. This is an interesting article – I agree with the outcome, but not the reasons. Ultimately the reason Display will be bigger than Paid Search is that there isn’t enough ad inventory available in Paid Search to leave a lot of upside on the marketplace.

    Display has a lot more headroom. Even if only 2% of all display impressions become extremely high yield impressions, that’s way more available inventory than the entire paid search market. Since search’s average CPM is about $75 – they yield a huge amount on a small number of impressions. Average CPM on all display (fully diluted) is less than $2 depending on who you ask. But if 10-20% of inventory in display can get to a fully diluted CPM greater than $35, and the top 5% can top $45, I think the doors will blow off the industry. And I believe it will happen.

    I wrote on this topic twice in the past: