Updated 30th October 2026. First published in 2017.
Display advertising shows your image and video ads to people while they read articles, watch videos or check their email, not while they search. Google's display ads appear on over 3 million websites and over 650,000 apps, as well as Google's own properties such as YouTube and Gmail.
Google renamed AdWords to Google Ads in 2018, and display advertising is changing again now. Google is moving standalone display campaigns into Demand Gen, its campaign type for YouTube, Discover, Gmail and Maps, with the switch running into 2027. If you're starting with display today, you need to understand both.
In my experience, display works best as a remarketing tool and a low-cost way to build brand awareness. It rarely works as a way to win cold leads from a banner. This guide covers how display works now, which campaign type to choose, the ad formats and targeting that matter, how to stop wasting budget and how much to spend.
Display versus search
Search ads reach people actively typing a query, so they show intent. Display ads reach people before they've started searching, which makes them cheaper per click and far less likely to be clicked.
The gap is large. WordStream's analysis of 16,446 US search campaigns found an average search click-through rate of 6.66% and an average cost per click of $5.26. For display, Focus Digital's 2025 analysis puts the average click-through rate at 0.46% and the average cost per click at $0.63.
Search versus display, clicks and costs
Average click-through rate and cost per click on Google Ads
Sources: search from WordStream 2025 Google Ads benchmarks (16,446 US campaigns, April 2024 to March 2025). Display from Focus Digital (2025).
Cheaper clicks don't mean better value. People clicking a display ad are browsing, not buying, so judge display on what it adds to your other channels, not on its cost per click alone.
Display is moving into Demand Gen
migration tool reached eligible advertisers in June 2026. Google will then stop new standalone display campaigns and move the remaining ones across automatically, with the process continuing into 2027, according to Search Engine Journal.
The Display Network itself isn't going away. It becomes one of the channels inside a Demand Gen campaign, alongside YouTube, Discover, Gmail and Maps, and you choose which channels to use. Demand Gen also brings lookalike segments, carousel and video formats, AI image tools and channel-level reporting. When you migrate, your settings and budget carry over, along with up to 42 days of performance history.
Google claims advertisers who add the Display Network to their Demand Gen campaigns see an average 9.5% increase in return on investment. Treat that as Google's own figure. We haven't migrated client campaigns yet, and when we do, the first thing I'll check is whether placement exclusions, app exclusions and content settings came across intact.
One control doesn't make the move. Display campaigns let you cap how often the same person sees your ads, while Google states that frequency capping isn't supported in Demand Gen campaigns. Without a cap, a small remarketing list can see the same ad over and over, so watch frequency in your reports and refresh your creative more often after you migrate.
Display, Demand Gen or Performance Max
Google now offers three ways to reach its visual inventory. The right one depends on how much control you want and what you want the campaign to do.
| Campaign type | Where ads show | Best for | Avoid it when |
|---|---|---|---|
| Display | Websites and apps across the Display Network | Low-cost remarketing and placement control | You want cold leads from banners alone, or you're starting after Google closes new display campaigns |
| Demand Gen | YouTube, Discover, Gmail, Maps and the Display Network | Creating demand with strong video and images, and display from 2027 onwards | You don't have good video or photography |
| Performance Max | Every Google channel, including Search and Shopping | Sales and leads when you already have solid conversion data | Your budget is small or you need tight control over where ads appear |
Performance Max needs conversion history and budget to learn, and without careful set-up it can take credit for branded searches you'd have won anyway. For most beginners, I'd start with search, then add display or Demand Gen for remarketing.
The ad formats that matter now
Responsive display ads are Google's default, and when we run display, about 80% of our ads are responsive. You supply images, logos, headlines and descriptions, and Google combines them to fit whatever ad space is available. Google recommends landscape images at 1200 by 628 pixels, square images at 1200 by 1200 and vertical images at 900 by 1600, with up to 15 images per ad and descriptions of up to 80 characters. Google assembles the combinations without human review, so make sure every image and headline works with every other.
The other 20% are custom banners, which we design when a brand has strict guidelines, legal wording or a promotion that automation might garble. If you upload fixed-size banners, a handful of sizes cover most inventory, including 300 by 250, 728 by 90, 336 by 280, 300 by 600 and 320 by 50 for mobile. Google limits uploaded image ads to 150KB in GIF, JPG or PNG format, and animations must stop within 30 seconds. Our guides to banner design and the perfect display banner cover the design side. Old guides that mention Flash or SWF files are describing formats browsers dropped years ago.
Google's AI image tools are useful for swapping a cluttered background for a clean one or creating quick variations for testing. Never use them to generate the product itself, because they get details, stitching and logos wrong. Real photography should always come first, especially for B2B brands, where generic AI images of offices and people undermine trust.
Match the ad to where people are
The same ad shouldn't go to someone who has never heard of you and someone who left a product in their basket yesterday. Write for the stage each audience has reached.
Cold audiences need to understand the problem you solve. Lead with that and use a soft call to action, such as "see how it works".
People who visited your site need proof. Show a result, a review or a case study, with a call to action such as "read the case study".
People who reached your pricing page or basket are close to deciding. Remind them of what they viewed and give a direct call to action, such as "book a call" or "complete your order".
Targeting on the Display Network
Display has no search query to target, so Google gives you other ways to define who sees your ads. Layering two methods narrows your reach and usually improves quality.
| Targeting | How it works | Use it for |
|---|---|---|
| Remarketing | Shows ads to people who visited your site, used your app or appear in your customer list | The strongest starting point for almost every business |
| Custom segments | Builds an audience from keywords, competitor websites or apps you choose | Reaching people researching what you sell |
| In-market and affinity | Uses Google's segments for people researching a category or with a lasting interest | Broader awareness |
| Lookalike segments | Finds people similar to your customers, in Demand Gen | Scaling beyond remarketing |
| Contextual and topics | Places ads on pages about your keywords or topics | Matching what someone is reading right now |
| Placements | Lets you choose specific websites, apps or YouTube channels | B2B presence on named industry publications |
Topic targeting on its own is usually too broad.
A topic as wide as "human resources" won't help an ad aimed at graduate recruitment, so combine topics with another method, such as custom segments. Google can also expand your audience beyond the segments you chose through optimised targeting, so check where your ads actually show before you trust the results.
Remarketing, where display earns its keep
Remarketing delivers the best return from display, because it reaches people who already know you.
For ecommerce, dynamic remarketing pulls products from your feed and shows people the exact items they viewed or left in their basket. For B2B, remarketing keeps you in front of people who read your content or visited your pricing page during a long buying cycle. Our remarketing service covers both.
Remarketing audiences are smaller in Europe than in the USA.
Google requires advertisers to collect consent from users in the European Economic Area and pass those consent signals through consent mode. Anyone who declines advertising cookies can't join your remarketing lists, so European lists fill more slowly. Uploading your own customer lists helps close the gap, and our guide to setting up a website properly covers consent and tracking from day one.
How to set up your first display campaign
Most beginners open Google Ads, create a campaign and add tracking later. Do it the other way round.
Set up conversion tracking first. Track the enquiries, bookings or sales you want, and connect consent mode if you have European visitors. Without conversion data, Google has nothing to optimise towards.
Build your remarketing lists early. Lists only start filling once your tag is live, and they need a minimum number of people before Google will serve ads to them.
Choose your campaign type. For new campaigns, that increasingly means Demand Gen with the Display Network switched on in its channel controls.
Add your exclusions before launch. Apply app, children's content and placement exclusions from day one, not after the budget has gone.
Upload a full set of assets. Supply every image ratio, several headlines and your logo, plus fixed-size banners if your brand needs them.
Set a bid strategy for conversions. Start with maximise conversions, then move to a target cost per acquisition once you have enough data.
Review placements every week. Give the campaign a couple of weeks to learn, then cut what doesn't convert.
Stop wasting budget on bad placements
Left alone, display campaigns drift towards placements that produce cheap, accidental clicks. Google's system reads those clicks as engagement and spends more there.
Mobile games are the classic example. People tap your ad by accident and return to their game within seconds. Kids' content is another. Parents hand their phones and tablets to their children to keep them entertained (or maybe it's just me!), and children click ads without knowing what they are. Hardly your target audience.
Then there are made-for-advertising sites, built purely to sell ad space with little real content. A study by the US Association of National Advertisers found that such sites took 21% of impressions and 15% of spend in the programmatic campaigns it analysed.
These steps keep your budget on real people.
Exclude app categories unless apps genuinely suit your product, which is rare for B2B.
Exclude children's content and add known kids' channels and sites to a shared exclusion list.
Choose a stricter inventory type in your content suitability settings, which removes lower-quality sites.
Apply exclusion lists at account level, so every new campaign starts protected.
Check the "where ads showed" report weekly and exclude placements with plenty of clicks and no conversions.
Bid for conversions, not clicks. If you optimise for clicks, the system heads straight for accidental ones.
How much to spend, and how to measure it
For a new client, we put most of the budget into search first, because search shows quickly which keywords and pages bring in revenue. Display starts small and only for remarketing.
| Business type | Search | Display | Why |
|---|---|---|---|
| B2B lead generation | 90% | 10% | Search captures intent, and display remarkets to leads over a long sales cycle |
| Ecommerce | 80% | 20% | Search and Shopping capture buyers, and display recovers abandoned baskets |
| New or niche product | 70% | 30% | Few people search yet, so display has to create demand |
Only move display budget into cold prospecting once your search campaigns hit their target cost per acquisition. Then test custom segments built from the search terms that already convert.
Measuring display takes care. Google reports view-through conversions, where someone saw your ad without clicking and converted later. Some of those are real, as people often see an ad, ignore it and search for you the next day. Many aren't, especially in remarketing, where Google takes credit for customers who would have bought anyway. I never value a view-through conversion as highly as a click. Keep the attribution window short, and if you spend enough, test the true effect by holding back a small share of your audience from seeing ads and comparing the results. Watching branded searches in Search Console also tells you whether display is building awareness.
Which businesses should use display advertising?
Ecommerce businesses see the most direct return, mainly through dynamic remarketing. B2B businesses get less from display as a cold channel. It works as remarketing and as placement targeting on the industry sites their buyers read, supporting a slow decision rather than prompting a purchase. Businesses priced out of competitive search markets can also use display to stay visible at a fraction of the cost per click, as long as they accept it won't behave like search.
Display works best as one part of a wider mix, which I cover in seven online marketing channels, and our guides to the benefits of PPC and ecommerce PPC show how it fits with search and social ads. Whichever you choose, the page people land on has to deliver what the ad promised, as I explain in the anatomy of a webpage.
If you'd like help, our display advertising and Google Ads management services sit within our PPC agency. Our web design team builds landing pages that convert, our content writers handle ad copy, and our SEO and social media teams make sure paid and organic work together.
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Yes. Google renamed AdWords to Google Ads in 2018, the platform and the Display Network within it work the same way, only the name changed. Any current guide describing "AdWords" is referring to what's now called Google Ads.
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Not the ads themselves. Google is moving standalone display campaigns into Demand Gen, with a migration tool available since June 2026 and the change running into 2027. The Display Network becomes one channel within Demand Gen.
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No. Flash based ad formats stopped working when browsers dropped Flash support entirely. Modern rich, interactive ad experiences are built through HTML5 instead, uploaded as image or HTML5 assets rather than the SWF files older guides describe.
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Remarketing to people who've already visited a website is usually the strongest starting point, since it consistently outperforms targeting people who've never heard of the business. From there, layering in-market or custom segments with contextual targeting tends to work better than relying on any single method alone.
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Display clicks cost far less than search clicks. Focus Digital's 2025 analysis puts the average display cost per click at $0.63, against $5.26 for search in WordStream's 2025 benchmarks. Click-through rates are much lower too, at around 0.46% for display.
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Mostly as remarketing. B2B buyers rarely act on a banner from a cold audience, although display works well for staying in front of people who visited your site and for placements on industry publications during a long buying cycle.
