IAB on advertising ROI

According to a recent study from the IAB and Comscore, the average click-through rates for sponsored ads related to travel and finance were 18.3% for April and May of 2003. That compares with click-through rates of 4.3% for ordinary search results for related terms. Sponsored ads also drove more sales than did ordinary search links, according to the research. About 1.4% of the people who clicked on sponsored listings became customers of the advertisers. In comparison, about 0.6% of the people who clicked on ordinary search results made a purchase.

Online advertising formats have historically faced problems with declining response rates over time. Banner ads debuted with click-through rates above 50%, according to Nielsen/NetRatings research analyst Marc Ryan, but faded during their heyday to about 2% - a respectable performance for direct response ads. Now banners get fewer than 5 responses for every 1,000 advertisements shown, a response rate of about 0.5%.