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Simply because traditional media does not understand search well, and the transition from advertising on television to display media on a CPM basis is exactly the same. Even if the conversions and values of display media are sub-par compared to search / contextual search, the marketing executives that control the marketing spend will always lean towards something they understand transitioned over from traditional media advertising such as television spots, and print advertising.

How much does television ad spots cost?

• Excluding the production cost of a commercial. Medium sized markets charge as little as $5 per 1,000 viewers.

How much does newspaper print ads cost?

• Again the cost is based on the circulation number. Obviously a spot on a newspaper with 50,000 circulation numbers will cost less than a spot on a newspaper with 100,000 circulation numbers. Based on these numbers, the print ad cost can be calculated in terms of cost per 1000 impressions.

How display media relates back to television and print ads?

• Marketing officers understand the impression basis. If they have ever bought television spots previously based on Nielsen ratings per 1000 viewers, then they are comfortable placing a rich media flash banner or static banner ads on websites such as ESPN.
• Making the transition from paying upwards to $100,000 dollars for television spots to $20,000 for banner advertising on popular websites seem affordable.

Display media will continue to grow because dollars will be pulled from traditional television and newspaper media into something that is calculated on a CPM basis. Search advertising is not on a CPM basis but a CPC and these advertisers with money would rather spend money on something they know than something where they are treading in unfamiliar territory even if it has a somewhat sub-par conversion and value when comparing media display verses search display side by side.

Just because an ad is delivered over 1000 impressions, it does not necessarily mean it will lead to conversions. Where as in search ads, you can get over 20k impressions with total CPC spend of $20 in one day to get an effective eCPM of $1. $1 for 1000 impression, that’s a bargain in terms of value and knowing how many actual visitors are driven to your web properties.