Recently, one of our CPG clients asked us straight up why they should continue to do digital banner advertising. This was not an unexpected question given an almost universal client frustration with the medium due to low click-through rates. But click-through rates are hardly the sole measure by which brand managers should judge their digital display campaigns. Below are five reasons why CPG marketers should maintain – if not increase – their digital display advertising efforts.

1. Detailed digital advertising a good bet to reach mom.

When the Coalition for Innovative Media Measurement and Media Behavior Institute surveyed US moms about their weekday media habits they found that among both millennial and Gen X mothers, mobile usage was most common (even ahead of television) with going online and social networking also among their favorite activities.

The actions moms took after viewing online ads is another argument in favor of buying digital placements. According to a complementary survey from About.com, after viewing a digital display ad, some 53% visited the product’s website and 51% printed ads or coupons. 48% of moms—notorious for their thorough product investigations on the internet—did more research online, and 44% clicked on the ad. Finally, nearly four in 10 moms purchased the product being advertised.

eMarketer, July 29, 2011

2.  Those that see ads and don’t click, convert later.

A MediaMind study from 2010 provides evidence to back up brand marketers who want to measure more than just clicks to determine the effects of their campaigns. Just 20.4% of conversions came after clicking on a banner ad. Instead, the vast majority happened among web users who had seen the ad but not clicked on it, and who converted at a later date.

Also, marketers should realize that the decline in CTR from 2006 to 2010 has plateaued. According to Gal Trifon, CEO and co-founder at MediaMind:

Although CTR is only a partial measure of online success, the leveling of CTR shows that online advertising has reached a level of maturity and that advertisers have become more sophisticated in luring users’ interest.

eMarketer, Spring 2011

3. Rich media campaigns boost intent to recommend.

Display campaigns may not often get credited with the last click before a conversion, but their value as a branding tool continues to be borne out. Research from audience data intelligence firm Lotame indicates a significant lift in intent to recommend a product among internet users who have seen a display ad. Lotame discovered an 11.7% lift in likelihood to recommend advertised products among Internet users in North America exposed to online display ad campaigns.

Also, campaigns that feature expandable rich media ads performed best, with a 34.4% lift. Flash banner campaigns underperformed compared to the average. None of the campaigns studied featured only static banners.

eMarketer, June 3, 2011

4. Digital display is resurging due to an evolution in targeting.

In a March 2011 interview with eMarketer, Alan Osetek, president of Resolution Media, said in the past 12 to 18 months, the maxed-out state of paid search inventory, coupled with the increased offering of behavioral targeting, search retargeting and audience retargeting, has created an environment ripe for a resurgence of display advertising.

As ad networks, exchanges and even publisher sites offer behavioral targeting and audience retargeting—allowing advertisers to purchase inventory through performance-based pricing instead of bulk impression buys—marketers who once saw display advertising as a branding-only ad format will be sure to reconsider.

eMarketer, Spring 2011

5. Digital display advertising is not a monolith. Align inventory type with business objective.

In addition to the kinds of digital display executions such as rich media and flash, there are also a various types of digital display inventory. Use of inventory types depends on your objectives. Alignment is key. If you wish to generate awareness then utilizing premium publisher inventory is best followed by general ad networks. Foster engagement – employ social media networks. Retention – leverage demand-side platforms and general ad networks. See the chart below.

eMarketer, Spring 2011

In summary, the rumors of the death of display advertising have been greatly exaggerated. The medium’s alive and kicking and when properly executed is still an efficient and effective part of most CPG advertisers’ digital plans. So before you lop off display from your overall mix, consider that you may be cutting off your nose despite your face.