November 10, 2004, 12:00 AM

Online ad market showing signs of maturity in Q3, DoubleClick reports

DoubleClick’s third-quarter ad-service trend report suggests that the online advertising market is showing more stability, indicating the market is maturing. Rich media stays stable at a percentage of all ads served.

Kurt Peters

Executive Editor

DoubleClick Inc.’s third-quarter ad-service trend report suggests that the long-volatile online advertising market is showing more stability, indicating that the market is maturing. Rich media remains stable as a percentage of all ads served, larger ad formats are becoming standard, click rates are stable across rich media and non-rich media units, and view-through–a metric that essentially captures delayed click-through after a viewer first sees an ad–is outpacing click-through at a rate of two to one.

“DoubleClick’s third-quarter ad serving data demonstrates that online advertising is assuming some predictable characteristics as it matures,” said Doug Knopper, senior vice president, ad management, DoubleClick. “Advertisers can rely on recent trends to continue, including heavy rich media adoption, stable click-throughs and larger, more engaging ad formats. At the same time, there is still opportunity to capitalize on unique features like frequency capping and the post-impression impact of online advertising.”

Rich media as a percentage of all online ads served by DoubleClick has remained stable at 43% through the year. That indicates that advertisers now allocate a standard percentage of their budgets to the format, according to DoubleClick. While the standard-sized ad banner still accounts for the largest portion of all ads served, 25.2% in the third quarter, that represents a decline of 4.8 points from Q2. The average click rate for a standard banner is 0.17%.

The average click-through rates for all ads served by both advertisers and publishers using DoubleClick ad serving also were stable through the year, with an uptick of 11% from Q2 to Q3. The average click rate in Q3 was 0.62%, DoubleClick reports. Rich media click rates continue to be about five times those for non-rich media ads.

“Post-impression” (rather than post-click) activity rates remain twice those of click-through rates. In Q3, the average click-through rate for ads served by advertisers was 0.41% as compared to an average view-through rate of 0.82%. According to the subset of ads served by advertisers in Q3, more than five times the number of conversions resulted from view-through rather than click-through activity.

“Frequency capping,” which limits the number of exposures to the unique user is a potentially useful technique in advertising that is still largely unused, DoubleClick found. The exception is publishers who place frequency caps rich media to protect the user experience. Of all ads served by DART for Publishers, 16% currently use frequency caps.

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