In my experience advertising conversion rates follow a distinct order:
– Re-marketing ads with a nice incentive convert the best.
– Relevant Search Ads convert the 2nd best.
– PPC Display / Banner Ads have the lowest conversion rate of the three.
Search ads tend to be the focus of most pay per click campaigns because of the ease of setup and the higher conversion rates. Many ppc managers shy away from display / banner campaigns because the conversion rates are typically significantly lower then search ads. The power of display advertising is not in the direct response, but the post visit potential.
The low conversion rate of display / banner ads can be offset by re-marketing to banner ad customers who went down the conversion funnel. Driving lots of lower cost traffic via banners can increase your re-marketing traffic and conversions. Its necessary to drive as much traffic as possible from as many sources as possible to narrow down your target customers or those who went further down the conversion funnel.
Simply put, display / banner advertising if used properly in conjunction with re-marketing campaigns can increase the overall conversion rate of your display marketing efforts. Don’t let the low conversion rates of display scare you away, instead embrace the potential all that new traffic holds.