Banner ads are an effective advertising medium — increasing its share of U.S. online ad spending to 38% in 2010, up from 35.2% in 2009. As such, we put together the following nine steps to help you get the most bang for your advertising buck.

Establish Clear Goals and Objectives

As with any marketing communications, your presence needs to be driven by a set of advertising objectives. First, ask yourself what you’re trying to accomplish.

Are you trying to;

• Build brand loyalty
• Increase website traffic
  Be sure to set a specific amount, either in unique visitors or a percentage increase over a non-advertising time period.
• Generate sales
  again, choose a specific number of how many sales you want to make.
• Build a social media following
  This could be Facebook ‘Likes’, Twitter followers, being added to X number of Google Plus Circles, etc.
• Improve customer convenience

With any type of advertising, your ads could touch on all the above but, to be successful, you must set priorities and focus on the most pressing strategic need.

Define Target Audience

If you don’t know who you’re trying to reach, it’s nearly impossible to create an effective ad. I say “nearly” because there’s always a chance you could get lucky — but I doubt it.

• Who are they? Age, gender, income level, etc.
• What do they care about?
• What do they want?
• Why should they care about your brand/product?

Define Communication

What EXACTLY are you trying to communicate? What is the benefit of your product or service? The goal is to focus on a single benefit. If you try to communicate too many things, it will confuse the reader.

The rule-of-thumb is, don’t try to be all things to all people.

Select Target Rich Websites

Now that you know who your target audience is and what you need to say, it’s time to find out where your customers are. What sites do the frequent and how will you get your ad displayed on those sites? How to do this is something I’ll cover in another article. But in the interim, you can use services such as TextLinkAds and BuySellAds to find topic specific websites to display your ads.

Choose Ad Placement and Sizes

Where an ad is displayed on a website depends on the website, the ad size, and your budget.

Simple rule is this; the larger the ad and the higher (or more prominent) the ad is displayed on the web page, the more it will cost.

Above or Below the Fold?

Many will argue that anything “above the fold” (ads that can be seen without scrolling down) will get a higher click-through-rate (CTR). But in reality, it all depends on the site, the content, and the visitor.

For example, you’ll notice a large 720×90 ad placed prominently above the article. There are also 1-2, 160×600 ads in the right column further down the page (below the fold). On this page, you need to scroll up and look to the right too see them. Because the information we post tends to be much longer than average, and our the demographic leans towards an older viewer, the 160×600 ads get a higher CTR.

Banner Ad Sizes

View full list of the most common ad banner sizes created by the Internet Advertising Bureau.

Sample Rising Star Display Ads.

Design to Audience (and Location)

Your banner ad design needs to be appropriate for who you’re trying to reach and where they are when they see your ad.

Don’t design your ads to look like IBM if you’re trying to reach an MTV crowd.

Three Kinds of Banner Ads

Static Banners

• Static banners have a lower CTR than a good text link.
• Static banners have a smaller file size than animated banners.

On the upside, static banners load faster which can often be more important than a higher CTR.

Animated Banners

The purpose of animation is twofold.

1. To attract the eye. It only needs a “wiggle” of animation, which is often enough to increase the CTR by 5-10%.
2. To allow more “space” for additional text or images. Two layers give you twice the space.

Tips for creating an animated banner ad.

• Animation should not be too powerful; you just want to attract the eye, not make it hard to look at. If words blink they should blink slowly. Give the viewer enough time to actually read the words.
• Make it easy to look at. When a viewer scans a banner they will look at the images, then the text. While they’re looking at images you want them to see everything without moving the eye. If they’re interested in your images they will switch to “reading mode.” Now you want to give them all the text, again without needing to move the eye. So you put the images one on top of the other, and all the text in the same place, too.
• Be creative. These are general rules, but you can be creative, too. For instance, it’s often effective to put a long or complex message in multiple layers, without changing the position. This can give some continuity to the banner and allow people the “visual stability” needed to read the long or complex message. A message such as “Sign up for a one-year Karate training and get two months free.” would need to use this method, perhaps in smaller text along the bottom of a banner. Capture the important ideas in simple phrases and the above example becomes two frames: “Sign up for a one-year Karate training” and “Get two months Free!”
• If you’re a banner designer and can create banners that get even a 1-2% higher CTR than poorly designed banners, you can sell your banners for a lot more money. A banner with a 1% higher CTR, placed on a page getting 3,000 unique visitors, will generate additional traffic and that translates to more sales every month. A high CTR banner is worth much more to a business than a banner that performs poorly.

Rich Media Ads

With the advent of new and improved advertising technologies, rich media has developed into a popular format for reaching and engaging consumers because the technologies allow the consumer to interact with the creative asset.

For more information, see IAB Rich Media Creative Guidelines.

Take Advantage of the Internet’s Interactive Capabilities

What a banner, video or rich media ad can do is only limited by your imagination. More is expected in an online ad than a print ad. Here are just a few things you might try.

• Take reservations by directing customers to an 800 number or an e-mail address, or by giving them a printable fax form.
• Take meal orders for pickup or delivery via phone, e-mail, or fax.
• Keep patrons up-to-date on upcoming shows and special events with a regularly updated billboard on your Web site.
• Use a coupon or special offer in your Web site to encourage customer traffic and sales.
• Survey your customers about their preferences and encourage them to respond to you by e-mail.

Banner Design Tips

• Make your message simple to see, simple to read, and enticing. Encourage people to look at your ad.
• On your ad, stay within a five to seven word limit. Keep the message short and easy to grasp. People are busy and scan web pages quickly so your ad needs to quickly grab their attention and entice them to learn more.
• Have a dominant Call To Action message on your banner. There are lots of newbies who don’t know what a banner is for! Having a “click here” message can increase your CTR by 5% or more.
• Use your banner ads to entice people to click-through to your website. You cannot tell your whole story in a two-and-a-half-inch box, but you can use it to attract visitors to your Web site where you can tell them your whole story.
• File size is important. Smaller files load faster and smaller is always better. You can shrink a banner’s file size without changing its appearance by using one of the many utilities made for that purpose.

Remember, banners have limited lifespans. People stop responding to a banner after they’ve seen it twice. This requires that you constantly replace your old banners with new ones. If you don’t know how to make your own banners, be sure to factor the cost of new banner design into your monthly expenses.

Create and Optimize Landing Pages

when creating a banner ad, it’s important to consider where people will go when they click on your ad. The most common mistake is sending people to your home page. Don’t do that! Instead, you’ll want to create a page specific for each ad group.

The idea is to create message continuity. To do that, you need to create a landing page that continues the conversation of why user clicked-through in the first place.

Landing Page Design Tips

• Keep pages simple and easy to load. Don’t clutter with too much information or too many graphics.
• Keep it clean. If something isn’t helping make the sale, remove it from the page.
• Break up text into narrow columns and short paragraphs to make written content easy to read.
• Make a compelling offer
• Don’t offer too many choices (should only be one)
• Make sure call to action is easily seen
• Create a design that accommodates quick and easy changes.
• Structure the page order of your site so the hierarchy of information and the flow of content make sense. Read Anatomy of a landing page

Measure Results

If you’re not measuring ad performance and goals, you’re wasting your money. Testing your ads and landing pages is imperative to improving results and your return on investment.

Track Click-through Rate (CTR) & Conversions

The software necessary to track A/B split testing that will pay for itself in very little time because you’re able to test ads against each other and then refine and exchange unproductive banners ads for better ones. There are many software options including free services such as Google Website Optimizer

Remember, measuring should relate DIRECTLY to the goals you’ve defined.

Refine Your Message

Nothing is perfect, the first time, right out-of-the-box. Use information from tracking to refine your message, designs, landing pages, and test again. And keep testing!

The effectiveness and success of your banner ads requires research and commitment. With imagination, you can maximize the return on your investment, attract new business, and build a loyal customer community.