Return on Investment of Display Advertising: Google Ads vs. Facebook Ads

Return on Investment of Display Advertising: Google Ads vs. Facebook Ads

Joana Balça (IPAM, Porto, Portugal) and Beatriz Casais (School of Economics and Management, University of Minho, Portugal & IPAM Porto, Portugal)
DOI: 10.4018/978-1-7998-3201-0.ch001
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Abstract

This research compares the effectiveness of display advertising using Google Ads and Facebook Ads, regarding the outcomes both in digital interaction and conversion metrics. The business manager's perception of profitability is also studied and compared with digital analytics. The authors selected the case of a specific company and researched the attraction of consumer attention of display advertising using both tools in two different markets – Portuguese and Argentinean. The authors conducted digital analytics of the outcomes of advertising campaigns and analyzed an interview with the manager of the studied company. Findings illustrate that Facebook Ads is the most profitable platform for the company, and Argentina is the market that generates higher return in this tool, comparing with the Portuguese market. However, both platforms complement each other in different conversion metrics. Manager's perceptions may not be aligned with the evidences of digital analytics, leading to incorrect decisions.
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Introduction

Nowadays, with the increasing demand of the consumer, there is a huge need for companies to adapt their communication to new market trends, and nothing better than the development of display advertising, based on graphic and visual advertising on websites and social networks (Choi, Mela, Baseiro & Leary, 2019). Digital advertising also made marketing results more measurable and created the possibility of getting the results of various campaigns, as the return on investment, in real time, and thus to take strategic actions (Bayer, Srinivasan, Riedl & Skiera, 2020). Online display advertising has a wide variety of metrics that can be analyzed: Conversions, Cost / Conv. and CTR (Aslam & Karjaluoto, 2017).

Google Ads and Facebook Ads currently represent the top of the hierarchy of online advertising channels, with the goal of overcoming the traditional advertising methods (Bourgeois, 2016). It is known that, on certain occasions, the cost per conversion is lower in Facebook Ads than in Google Ads and for the level of conversions the number is higher. However, Google Ads may obtain more interesting results due to the fact that the search is carried out using keywords, the high volume of these searches, the segmentation opportunities and tracking tools (Popa, Tarca, & Sasu, 2016). Google Ads has been a major player in digital advertising (Bayer et al., 2020). In 2016, a forecast was made that 85% of this market would be represented by Google Ads (Bourgeois, 2016). Therefore, because several authors discuss this duality between the two platforms and because the existing knowledge is very general, the central objective of the present research is to contribute to that discussion, measuring the impact of display advertising campaigns using Google Ads and Facebook Ads on the ROI of a selected case study.

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