Google Ad Exec Predicts Engagement Rates For Display Ads Will Increase 50 Percent By 2015

Google’s Vice President of Display Advertising Neal Mohan just published a blog post with a few interesting projections relating to display ads on the web. Google, of course, has a booming display ad business that brings in billions. Mohan gave a number of predictions for display advertising (in a keynote speech given at Internet Week this morning), explaining that the company is investing in improving display advertising for publishers, advertisers and consumers.

Mohan predicts that the number of display ad impressions will decrease by 25 percent per person because people aren’t connecting with these ad formats. But as ad formats become more relavent and attractive (i.e. playing games or watching videos), engagement rates across all display ads will increase by 50 percent.

Another predictive stat—people will have a direct say in 25 percent of the ads they see. Technologes, says Mohan, will give users more control over what types of ads they want to see online.

Advertisers will also look beyond CTRs and other measurements in the future for display ads, claims Mohan. He says 35 percent of campaigns will primarily use metrics beyond clicks and conversions. Other factors like emotional engagement and impact on offline behavior (like in-store shopping choices) will also be determining factors in how successful an ad campaign is.

Google is also betting on the fact that people want to know why they are seeing ads in the first place. Mohan explains that 25 billion ads per day will tell people why they are seeing them (i.e. giving users an “Ads by Google” notice). And over 40 percent of online Americans will name display ads as their favorite ad format, predicts Mohan.

In a survey with YouGov of more than 1,000 U.S. Internet users, Google asked them what ad formats they liked and the number of people who said they preferred display ads trailed slightly behind the number who liked glossy magazine ads, cinema ads and sky-writing—formats.

We just wrote about the recent eMarketer study that estimates online ad spending will come in at $31.3 billion this year thanks to an upswing in display ads. In fact, eMarketer predicts that display ad spending will surpass search by 2015. No wonder Google, which also dominates search advertising, is so optimistic.