With publishers struggling to monetise digital and marketers unable to achieve cut through John McLean argues it’s time to ditch banner ads and get collaborating.

In a medium infatuated and necessitated by innovation, display advertising has been criminally bereft of it since it’s inception 20 years ago. The first banner ad appeared in Wired Magazine in 1994* and little has changed since around 2000 when rich media placements became more common due to better connection speeds.

Still standard banners still have a maximum file size of 40k and for the most part are still developed in Flash. But broadband and the new mobile paradigm are finally forcing a shift and the dominant players are changing.

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In so-called “traditional” channels, marketing attempts to modify behaviour (i.e. sell stuff) by entertaining, informing and engaging consumers. So too with digital media, however it is also uniquely interactive offering marketers the potential for deeper engagement and the opportunity to provide genuine utility. Only digital media can deliver such immersive brand experiences as BMW The Hire, Nike Fuel Band, Subservient Chicken, Decode Jay-Z and the rest.

As they are, banner ads simply devalue the digital medium in the mind of marketers and consumers.

Rather than providing engaging interactivity, Banner Ads were conceived to treat computer screens like billboards. Standard banners are simply resized print ads. Worse still, rich banner ads are used to disrupt users as they navigate the web with page takeovers, interstitials and pre-rolls et al -eeuugghh!

At least you can grab a cup of tea when a TVC comes on, harder to avoid disruptive banners. Not surprisingly, we hate and actively avoid them. This phenomenon is called “banner blindness”; as evidenced in studies like this one that employed eye (heat) tracking to monitor where people look when visiting websites – everywhere but the banner.

So… who cares?! Well, the problem is the disproportionate amount of marketing dollars spent on a medium that people hate and woefully under-performs. Success is often measured against ‘page impressions’ regardless of the fact that ads are often served out of view. “Clicks” are the only metric worth considering, yet a click rate of 0.01% is considered a success. Here are a few more stats that never cease to appall me:

1. An estimated 31 percent of ad impressions can’t be viewed by users. (Comscore)

2. 8 percent of Internet users account for 85 percent of clicks. (ComScore)

3. Up to 50 percent of clicks on mobile banner ads are accidental. (GoldSpot Media)

4. You’re more likely to survive a plane crash than click a banner ad. (Solve Media)

5. 15 percent of people trust banner ads completely or somewhat,compared to 29 percent for TV ads. (eMarketer)

6. 34 percent don’t trust banner ads at all or much, compared to 26 percent for magazine ads. (eMarketer)

These stats are from the US, but parallels can be inferred. The point is that I suspect a survey of Australian digital marketing budgets would reveal more money was spent on banner ad campaigns than more effective alternatives.

This money is wasted and should be spent on formats and tactics that have a proven ROI, directly drive sales and engage the consumer. Publishers and media agencies beware, according to eMarketer growth in banner revenue is steadily declining and reliance on such revenue will need to be addressed if many businesses are to remain viable.

Three quarters of Aussies access the internet via mobile devices (MagnaGlobal’s report ‘Unlocking the power of mobile’) and according to influential tech analyst Mary Meeker, mobile internet usage will surpass desktop within a few years. Its not surprising then that Google is driving hard to innovate and dominate the mobile display media space. Google’s new ‘Engagement Ads’ extend beyond typical Rich Media units. They are indistinguishable from branded micro-sites, offering all the features, content and engaging interactivity that one could expect from a campaign site. As they are developed in HTML/CSS they can be served to all devices.

Better formats also need to be placed contextually. Context (as well as content) is king and ads need to resonate with the content a consumer is engaging with. People are more likely to click on an ad to unlock a richer experience if the message is relevant to their interests and real time situation.

Further, ads need to be targeted to individual consumers. Programmatic buying has had a clumsy start, but it will most certainly come of age. Re-targeting is just as important as initial targeting, if not more so. Presenting communications that are re-targeted against device, location and site searches are very effective. If a person is accessing content via a mobile device, then serving advertising based on their search terms, location, situation and that fact that they are indeed “mobile” will better facilitate “path-to-purchase”. Technologies such as Google Ad-sense can help deliver these outcomes.

Finally, marketers should abandon the hopelessly impotent disruptive approach to advertising in favour of “native ad” strategies where branded content is integrated (not camouflaged) with other content. This allows users to be served ads relevant to them in an engaging manner that is neither deceptive nor accidental.

Banner ads must die… and be reborn as a medium with which humans actually wish to engage. The industry needs to collaborate to innovate and evolve the space or players risk being superseded. If digital advertising is better aligned and targeted, it cannot help but be more effective (and sell more stuff).

John McLean is general manager of Webling Interactive