What is Display Advertising?
Also known as: Display ads, Banner advertising, Banner ads
What is display advertising?
Display advertising is paid media that places visual ads, static images, animated banners, video units, or rich media, on websites, mobile apps, and connected TV screens. The ads run inside fixed slots reserved for advertising, separate from the editorial content around them.
The format is the original digital ad. AT&T ran the first banner on HotWired in 1994. The 468x60 banner sold for $30,000 and pulled a 44 percent click rate. Click rates have collapsed since. The format has not.
Display covers a wide surface:
- Standard banners. Static or animated images in IAB sizes.
- Rich media. Expandable, interactive, or video-enabled units.
- Video display. In-stream pre-roll, mid-roll, post-roll, plus out-stream units.
- CTV and OTT. Video ads on smart TVs and streaming apps.
- Retail media display. Banners on Amazon, Walmart, Target, and Instacart product pages.
Display is bought through direct deals, programmatic advertising auctions, and ad networks. It is the oldest, largest, and most fragmented slice of digital advertising.
Display ad formats
Display covers more than rectangles. The IAB groups units into five active families. Most spend concentrates in the first three.
| Format | Typical sizes | What it does |
|---|---|---|
| Leaderboard | 728x90, 970x90, 970x250 | Top-of-page banner, desktop reach |
| Medium rectangle (MPU) | 300x250, 336x280 | Inline unit, highest impression share |
| Skyscraper | 160x600, 300x600 | Sidebar unit, long dwell time |
| Video display | 16:9 in-stream, 6:9 out-stream | Pre-roll, mid-roll, autoplay |
| Rich media | Expandable, interstitial, lightbox | Interactive, higher CPM |
| Responsive | Auto-resize image plus headline | Programmatic Google Ads default |
The 300x250 medium rectangle drives the majority of programmatic display impressions because it fits both desktop sidebars and inline mobile feeds. Responsive units, where the platform recombines a headline, description, image, and logo, now make up most Google Display Network inventory.
Rich media earns a 267 percent higher CTR than standard banners on average, per Celtra's 2023 benchmarks. The cost per thousand runs higher too, but the engagement makes it pay for awareness campaigns.
How display advertising buying works
Display ads reach inventory through three buying paths. Most large advertisers run all three in parallel.
Direct deals
The advertiser negotiates directly with a publisher. Fixed price, fixed placement, fixed flight dates. Used for premium homepage takeovers, sponsorships, and newsletter banners. Strong on brand safety. Weak on scale and optimization.
Programmatic
An advertiser uses a demand-side platform (DSP) to bid on impressions in real time. The publisher offers inventory through a supply-side platform (SSP). The auction runs in under 100 milliseconds. Programmatic accounted for roughly 91 percent of US display ad spend in 2024, per eMarketer's programmatic forecast.
Ad networks and self-serve
Google Display Network, Microsoft Audience Network, Yahoo, and Taboola let advertisers upload creative and target audiences without a DSP. The Google Display Network reaches over 90 percent of internet users worldwide across more than 2 million sites, per Google's official documentation. Self-serve is the entry point for most small and mid-market brands.
The buyer's choice depends on budget, control, and targeting depth. Direct for premium. Programmatic for scale. Self-serve for ease.
Standard sizes and IAB units
The IAB Tech Lab maintains the canonical list of ad sizes. The current spec is the New Ad Portfolio, which replaced the rigid Universal Ad Package in 2017 with a flexible aspect-ratio system.
The most-used desktop and mobile units:
| Unit | Pixels | Where it runs |
|---|---|---|
| Medium rectangle | 300x250 | Sidebar, inline, mobile |
| Leaderboard | 728x90 | Desktop top of page |
| Wide skyscraper | 160x600 | Desktop sidebar |
| Half-page | 300x600 | Desktop sidebar, premium |
| Large rectangle | 336x280 | Inline content |
| Mobile banner | 320x50 | Mobile bottom of screen |
| Mobile large banner | 320x100 | Mobile inline |
| Billboard | 970x250 | Desktop top, premium |
File-size caps matter. Standard banners cap at 150 KB initial load and 2.2 MB polite load, per IAB display creative guidelines. Heavier files get rejected by exchanges or downranked in auctions. Animation runs no longer than 15 seconds.
The IAB also publishes specs for video, rich media, native, audio, and emerging CTV formats. Treat the IAB New Ad Portfolio as the source of truth before any creative brief.
Why display has lower CTR than search but plays a different role
Display CTR averages 0.46 percent. Search CTR averages 6.5 percent. The 14x gap looks damning until you read what the formats are doing.
Search ads catch demand. Someone types "cheap moisturizer for dry skin" and a relevant ad appears. The intent is already there. The click is the next step.
Display ads create demand. A user reading a recipe site sees a banner for a kitchen knife. They were not shopping for knives. They might be next month. Display plants the seed. Search harvests it.
Three jobs display does well, that search cannot:
- Awareness. Reach users who do not yet know the brand exists.
- Retargeting. Show ads to users who visited the site but did not convert. Retargeted users convert 70 percent more often than first-time visitors, per Criteo's retargeting benchmarks.
- View-through influence. A user sees a display ad, never clicks, then searches the brand later. The display impression assisted the conversion. Last-click attribution misses it.
Measuring display on click-through alone is the wrong test. Measure on assisted conversions, view-through lift, and brand search volume increase. The format earns its place when it gets measured against the job it was hired for.
Real-world example with numbers
A US outdoor apparel brand runs a display campaign to drive Q4 jacket sales.
Setup:
- $80,000 budget across 60 days.
- Three audience segments, prospecting, retargeting, and CTV.
- Creative: 300x250, 728x90, 160x600, 320x50, plus 15-second video for CTV.
- Buying: Google DV360 for prospecting and retargeting. The Trade Desk for CTV.
Results after 60 days:
| Segment | Spend | Impressions | Clicks | CTR | Direct conversions | Assisted conversions |
|---|---|---|---|---|---|---|
| Prospecting | $32,000 | 14.2M | 51,200 | 0.36% | 84 | 612 |
| Retargeting | $24,000 | 4.8M | 38,900 | 0.81% | 421 | 287 |
| CTV | $24,000 | 3.1M | n/a | n/a | 38 | 446 |
Direct CPA on prospecting alone: $381. Brutal. Add assisted conversions and the CPA drops to $46. CTV had no clicks (the screen does not click) but contributed 446 assisted conversions and a 23 percent lift in branded search during the flight.
The display program looked like a failure on a click report. It looked like a winner on the assisted-conversion report. Same campaign. Two different stories.
Display advertising in 2026
Display is changing shape, not shrinking. US digital display ad spend is forecast to exceed $190 billion in 2026, per eMarketer's display forecast, with growth concentrated in three areas.
Connected TV. CTV ad spend in the US passes $42 billion in 2026, per eMarketer. Smart TVs, Roku, Fire TV, and streaming apps are now the fastest-growing display surface. The unit is a 15 or 30-second video. The buying is programmatic. The measurement is shifting from gross rating points to attributed conversions.
Retail media. Amazon, Walmart Connect, Target Roundel, Instacart, and Kroger Precision now sell banner inventory on their own product pages. Retail media display passes $30 billion in US spend in 2026. The targeting uses first-party purchase data, which makes it the most accurate display surface available.
Contextual targeting return. Third-party cookie deprecation in Chrome forces a return to context. Advertisers buy inventory based on the page content, the article topic, or the moment, not the user's tracked history. Contextual share of programmatic display has climbed every year since 2022.
The banner is not dead. It is splitting into bigger screens, smarter shelves, and cookieless context. The brands that win in 2026 are the ones that match ad creative to the surface, measure beyond the click, and stop running display the same way they did in 2014.
Related terms
Frequently asked questions
What is the difference between display advertising and native advertising?
Display ads sit in fixed banner slots and look like ads. Native ads match the editorial layout of the host page and read like content. Display optimizes for cheap reach and retargeting. Native optimizes for context and lower-funnel conversions. Both run programmatically through the same DSPs.
What is the average CTR for display ads?
Average display CTR sits around 0.46 percent across industries, per WordStream's 2024 Google Ads benchmarks. Search ads average roughly 6.5 percent. The gap reflects intent. Search users are actively looking. Display users are scrolling. Display wins on impressions and view-through, not click rate.
What are the most common display ad sizes?
The IAB's most-used units are the 300x250 medium rectangle, 728x90 leaderboard, 160x600 wide skyscraper, 300x600 half-page, and 320x50 mobile banner. The 300x250 unit dominates volume because it fits both desktop sidebars and inline mobile placements. See the IAB New Ad Portfolio for the full spec.
How do you buy display advertising?
Three paths. Direct deals with a publisher, fixed price and placement. Programmatic auctions through a DSP like Google DV360, The Trade Desk, or Amazon DSP. Self-serve ad networks like Google Display Network or Microsoft Audience Network. Programmatic accounts for the majority of US display spend, per eMarketer.
Is display advertising still effective in 2026?
Yes, when used for the right job. Display drives awareness, retargeting, and CTV reach. It is poor at last-click conversion. Treat it as an upper-funnel and mid-funnel tool. Measure on view-through conversions, assisted conversions, and brand lift, not just clicks.