Big spending on display ads not translating into healthy online sales

Surprisingly, email ads deliver more traffic than all social channels combined...

Big spending on display ads not translating into healthy online sales

File photo of someone using a laptop | Image: Dominic Lipinski / PA Wire/Press Association Images

Online banner and display ads are failing to register as one of the top 10 generators of Irish customer traffic, according to a new report from Dublin-based agency Wolfgang Digital.

This is despite the fact that they are absorbing close to 40% of all online marketing spend in Ireland.

Wolfgang's survey of Irish travel and retail customers found that Ireland's average ad spend-to-sales conversion rate of 1.5% is in line with international norms.

The average value of online spend has grown by 20%.

According to Wolfgang, the speed of an ecommerce site is critical. A company can expect an 8% improvement in sales conversion for every 0.2 of a second it can shave off its website's response time.

When it comes to the big players targeting Irish consumers, Google Ads still overwhelmingly dominate. The search engine delivers 70% of sales revenue to Irish ecommerce sites. Facebook is far behind but has seen huge growth; with 5% of the traffic, its share has more than quadrupled from the 1.3% it had in 2014.

Facebook is strong on mobile, which generates the 42% of traffic for sites overall, but has been struggling to generate revenue for them.

Speaking to Breakfast Business, Alan Coleman of Wolfgang Digital hailed the social platform as the "rising star" of online marketing, noting that it is "delivering a lot of measurable value".

He also said that one particularly effective online marketing option would surprise many:  

"The surprise performer in the study was actually email. Digital marketers, we often lust after shiny new things, where we found that email actually delivers more traffic than all the social channels combined.

"Only Google delivers more revenue."

Wolfgang analysed 87 million ecommerce website sessions and €230m in online revenue for the 12 months to the end of June as part of the study. Participants included Harvey Norman, Littlewoods Ireland and the Guinness Storehouse.

To see the full study, plus a whole host of tips and stats on online marketing, click here.