← Back to Blog

Are Ads Worth It?

Understanding the different types of ads, and whether they're worth running.

When an ad is done right, it can generate additional revenue, gain loyal customers and spark interest in a service.

However, in the digital age, the options for advertisement are endless. Marketing shouldn't be a guessing game, but creating an effective marketing plan isn't always straightforward. The first step is understanding the different options and which will benefit your company the most.

Why advertisements are important:

  • They generate brand recognition
  • Can introduce new products
  • They can add credibility
  • They can generate incremental revenue

Types of digital ads

Which type of ad is best for your company?

Search Engine Ads

Search engine ads can be highly effective forms of marketing. In this form of marketing, a company will bid on a keyword. When a person uses this keyword in a search, the company will appear at the top of a search result. This type of ad doesn't rely on flashy imagery, making it one of the more straightforward ads for a company to produce.

An example of this is Google ads.

Google has one of the most well-known forms of advertising. They offer comprehensive visibility and name recognition.

Pros:

  • You can target a specific customer base through keywords.
  • The ads are text-based and easy to create.
  • You can track your ad.

Google ads allow you to see the analytics of your ad. This will help you figure out if your marketing is successful and how well you can expect a similar ad to do in the future.

Increased visibility

Google has a billion users, which means

Pay when people click on an ad

Pay-per-click assures you're only not just paying for your ad to be on a page.

Cons:

  • May bring in views, not loyal customers
  • It is obvious that your advertisement is an ad- not an organic search result
  • Can be expensive

Popular keywords are sought after and can be expensive. It's a bid promise, which means you could end up paying more than it's potentially worth.

Social Media ads

Whether it's Twitter, YouTube, or Instagram, these ads appear on a user's feed and can be shown to a company's target audience. These ads will often blend into a feed and can be an effective way to increase brand recognition.

An example of this is Facebook ads.

Pros:

  • Targeted ads
  • Visibility on a large social platform
  • Cost-effective

Cons:

  • Results can be expensive
  • Facebook users may not be your target audience

Display ads

Display ads are the ads that appear on websites or other platforms. A company will pay a website to have their ad on one of the pages, most likely because the website and the company have similar audiences.

These ads are action-based, prompting potential customers to click on a link. These types of advertising tend to be cost-per-click based.

Pros:

  • Great for attracting a target audience
  • Action-based
  • Cost-per-click

Cons:

  • Requires eye-catching artwork
  • Easy to ignore

Native Advertising

Native advertisements are a subtle form of advertising where the ad is put into the content.

For example, imagine a company's target audience is mothers ages 25-45. This company could pay a popular Mommy blog to recommend their product at the end of an article.

Pros:

  • This form of advertising appears more trustworthy.
  • It's less obvious than other forms of advertising
  • Cost-effective

Cons:

  • May not offer easily accessible analytics
  • It may not be the first thing a user sees. If a user clicks out of an article before your advertisement, it will not be effective.

Remarketing

Have you ever visited a website and had their ad appear on every other site you visited? This is called remarketing (or retargeting). Remarketing is a common form of marketing and is great for increasing brand recognition.

Pros:

  • It can be inexpensive
  • It can be effective
  • Creates brand recognition

Cons:

  • Can be bothersome
  • It is an obvious form of marketing

Good vs bad advertisements

Now that you've decided the best type of marketing, the other aspect to consider is the quality of the ad. Hint: The best ads aren’t always the most entertaining.

So what makes a good ad?

  • The best ads have tangible results. Ads should attract loyal customers and increase overall revenue. While an ad can be incredibly entertaining, it doesn't always end in a purchase.
  • Good ads attract attention. In a world surrounded by advertisements, it's easy for an ad to become background noise. Making your company stand out is a difficult task, but when done correctly, it can generate large amounts of revenue.
  • A good ad will make the viewer remember the brand. Brand recognition is important to customers as it signifies trustworthiness. Brand recognition can help promote customer loyalty.
  • Ads should differentiate a product from its competition and answer the "why us." question. If the field is highly saturated, a good ad will increase brand recognition.
  • A good ad is relevant. At the end of the ad, a customer should be clear on the product or service.
  • A good ad is tailored to your target audience. Even if you use the right platform, an ad is only effective if it appeals to the consumer.

Using Data for Marketing

Ads should be worth the expenditure. Like most aspects of business, this is a data-based decision.

Causal can help by making marketing simple through easy and informative templates. The Probabilistic Marketing Forecaster is an excellent tool for ad planning.

Using your margin per conversion, which is the project you make per conversion, your budget, your conversion rate, and the cost-per click we will give you all the data you need to make an informed decision.

We will look at what your estimated conversions would be during the ad campaign, how much you'll spend, and how much you'll profit. This  template can help you figure out if your revenue per conversion is higher than your cost per conversion.

Marketing plans don't need to involve length and complicated spreadsheets. Causal offers clear models so you can make informed marketing decisions, stay on top of your marketing campaign, and forecast to stakeholders.

Build your own financial models for free

Thanks! We'll be in touch soon.
Oops! Something went wrong while submitting the form.