Online advertising has become one of the easiest ways for businesses to connect with new and potential customers. Unlike traditional marketing methods that cast a wide net, digital advertisements let you reach specific audiences at the right moment with messages tailored to their interests and needs.
Consumer behavior has changed over the last several years. People spend hours each day on their phones, scrolling through social media feeds, searching for products, and watching videos.
They're researching purchases online, reading reviews, and comparing options before making decisions. If your business isn't advertising where your customers already spend their time, you're missing out on valuable opportunities to grow.
In this article, we'll walk you through everything you need to know about online ad campaigns. You'll learn what online ads are, how they work, and which types might work best for your business.
We'll cover the key benefits of digital advertising, show you how to create effective campaigns, and explain how to measure your results. Keep reading to discover how online advertising can help you reach more customers.
What online ads are and how they work
Online advertising is the practice of promoting your business through digital platforms like search engines, social media platforms, websites, and mobile apps. When you run online ads, you're paying to display your message to potential customers as they browse the internet, watch videos, or scroll through their feeds.
The delivery of online ads happens through advertising platforms that connect businesses with publishers. You create your ad, set your targeting parameters, and choose where you want it to appear.
The platform then uses algorithms to show your ad to people who match your criteria. This process happens in milliseconds, often using real-time bidding systems that determine which ads get displayed based on factors like overall relevance, bid, and ad quality.
The model you choose depends on your goals and which stage of the customer journey you're targeting.
Model | Charging basis | Best for |
CPC (Cost-Per-Click) | Per individual click | Driving website traffic |
CPM (Cost-Per-Mille) | Per 1,000 impressions | Building brand awareness |
CPA (Cost-Per-Action) | Per specific conversion | Driving sales or sign-ups |
Types of online advertising businesses can use
Different ad formats serve different purposes in your marketing ecosystem. Some work better for building awareness, while others excel at driving immediate sales. The main types of online ads are:
Search engine ads
You see search ads at the very top of search results when people look for products, services, or information related to your business. Paid search ads are incredibly effective because they target high-intent users.
When someone types "running shoes near me" or "best accounting software," they're already interested in making a decision. Search engine ads put your business right in front of them at that crucial moment.
Social media ads
Social platforms like Facebook, Instagram, LinkedIn, and TikTok offer sophisticated audience targeting that lets you reach specific demographics, interests, and behaviors.
Reach different target audiences based on their age, location, job title, hobbies, recent purchases, and much more. Social media ads work well for building brand awareness, engaging with audiences, and driving conversions through a more visual and interactive experience.
Display ads
Display advertising includes banner ads and visual advertisements that appear on websites across the internet. These ads show up on news sites, blogs, and other web pages your audience visits.
While display ads typically have lower click-through rates than search ads, they're valuable for keeping your brand visible and reaching people earlier in their buying journey. Display ads work well as part of retargeting campaigns, reminding people about your business after they've visited your website.
Video advertising
Video ads appear before, during, or after video content on platforms like YouTube, streaming services, and social media.
Video advertising has grown rapidly because it captures attention and conveys messages more effectively than static images. Short video ads work well for brand awareness and can drive strong engagement when the content resonates with viewers.
Native advertising and sponsored content
Native advertising blends seamlessly into the surrounding content, matching the look and feel of the platform where it appears. Sponsored articles, promoted posts, and recommended content are all forms of native advertising.
This format tends to be less intrusive than traditional banner ads, which can lead to better engagement rates. Native ads work well for storytelling and educational content that provides value beyond a direct sales pitch.
Key benefits of online advertising for businesses
Online advertising offers advantages that traditional marketing channels simply can't match. Here's what makes digital advertising so effective:
Increased brand visibility and reach
Online ads put your business in front of potential customers wherever they spend time online, whether they're on mobile devices, web browsers, or apps. You're not limited by geography or publication schedules.
Your ads can reach more people across the country or around the world, running 24/7 to maximize exposure. This constant visibility helps build brand recognition over time, making people more likely to remember and choose your company when they're ready to buy.
Precise audience targeting and segmentation
Digital advertising platforms let you define exactly who sees your ads. You can target based on demographics, interests, purchase history, and more.
Online behavioral advertising tracks how people interact with websites and content, letting you reach users based on their actual browsing habits and online actions. This precision means your advertising budget goes toward reaching the right audience.
You can create ad campaigns for different audience segments, tailoring your message to resonate with each group.
Measurable performance and ROI tracking
Every aspect of online advertising can be measured and analyzed. You can see everything from the number of people who viewed your ad, how many clicked it, and the number of those who saw the ad and took action.
This data shows you exactly what's working and what isn't, letting you calculate your return on ad spend with precision. Unlike traditional marketing, where results are often unclear, online advertising provides concrete numbers you can use to make informed decisions and drive sales.
Budget flexibility for businesses of all sizes
You don't need a massive budget to get started with online advertising. Whether you're a small business or working with ad agencies, most platforms let you set your own spending limits and adjust them as needed.
You can start small, test different approaches, and scale up what works. This flexibility means advertisers of any size can compete for attention, not just companies with large marketing budgets.
Ability to test, optimize, and scale campaigns quickly
Online advertising campaigns can be launched, modified, and stopped in just a few minutes. You can test different headlines, images, target audiences, and calls to action to see what performs best. When you find a winning combination that attracts new customers, you can quickly allocate more budget to capitalize on what's working.
How to create effective online advertising campaigns
Strategic planning helps you avoid wasted spend and get better results from your campaigns. Here's how to set yourself up for success:
Define campaign goals and success metrics
Decide what you want your campaign to accomplish. Are you trying to boost website traffic, generate leads, boost sales, or build brand awareness? Your goal determines everything else about your campaign, from which platforms you use to how you measure success.
If this is your first campaign, focus on one clear objective rather than trying to achieve multiple goals at once. Set specific, measurable targets so you know whether your campaign is working.
Choose the right advertising platform
Different advertising platforms serve different purposes and reach different audiences. Search ads work well for capturing intent, while social media ads excel at targeting based on demographics and interests. Many platforms offer self-service tools that let you set up and manage campaigns without needing an agency.
Think about where your audience spends time, which platform aligns with your campaign goals, and what advertising options are popular in your industry. You might use multiple platforms as part of a broader strategy, allocating budget based on what works best for each objective.
Craft compelling ad copy and visuals
Your ad needs to grab attention and motivate action in just a few seconds. Write clear, benefit-focused headlines that speak directly to what your audience wants or needs. Whether you're creating text ads for search engines or visual ads for social media, use strong calls to action that tell people exactly what to do next.
If you're promoting special offers or limited-time deals, make that clear upfront. For visual elements, choose images or videos that are eye-catching and relevant to your message.
Set budgets and bidding strategies
Decide how much you're willing to spend daily or over the campaign's lifetime. Most platforms offer different bidding strategies, from manual bidding, where you set maximum costs, to automated bidding that optimizes for your goals.
Start conservatively as you learn what works, then increase spending on high-performing campaigns. Monitor your cost per result to ensure you're getting good value from your paid traffic.
Landing page considerations for better conversions
Your ad is only half the equation. When someone clicks through, they should arrive at a landing page that delivers on your ad's promise.
Make sure your landing page is relevant to the ad, loads quickly, and makes it easy for visitors to take the desired action. A disconnect between your ad and landing page will waste your advertising budget, even if the ad itself performs well.
How to measure the success of online ads
Tracking the right metrics helps you understand what's working and where to make changes. The metrics that matter most depend on your campaign goals. For awareness campaigns, focus on impressions and reach. For engagement, track clicks and interaction rates. For conversions, monitor cost per acquisition and return on ad spend.
Understanding the relationship between impressions, clicks, and conversions is essential.
Metric | What it measures | What it indicates |
Impressions | Number of times your ad was displayed | Brand reach and visibility |
Clicks | Number of people who engaged with the ad | Interest and relevance |
Conversions | Number of people who completed a goal | Effectiveness and ROI |
Looking at these metrics together helps you see where in the marketing funnel you might be losing people.
Review your campaign data regularly to spot trends and opportunities. If certain keywords or audiences perform better, shift more budget toward them. If an ad's performance drops, refresh the creative or adjust your targeting.
When you find a campaign that's delivering strong results at a good cost, that's your signal to scale up. If a campaign isn't working after testing different approaches, pause it and try something new. Your advertising strategy should evolve based on what the data tells you.
Future trends in online advertising
The way people advertise online continues to change rapidly. Here are the trends shaping where online advertising is headed:
- Increased use of automation and AI: Advertising platforms are using artificial intelligence to automate bidding, targeting, and creative optimization. These tools help businesses get better results with less manual work, automatically adjusting campaigns based on performance data.
- Greater focus on personalization and privacy: Consumers expect relevant, personalized experiences while also demanding better privacy protections. Advertisers are finding new ways to deliver targeted messages that respect user privacy, moving away from third-party cookies toward first-party data and contextual targeting.
- Growth of video and interactive ad formats: Video content continues to dominate online engagement, and ad formats are evolving to be more interactive and immersive. Shoppable videos, augmented reality ads, and playable ads are becoming more common, offering engaging experiences that go beyond static images.
- Omnichannel advertising strategies: Businesses are coordinating their advertising across multiple channels and devices to create cohesive customer experiences. Retail media networks are growing rapidly, letting brands advertise directly on e-commerce platforms where purchase decisions happen. The focus is on reaching customers consistently across every touchpoint in their journey.
Getting started with online advertising for your business
Online advertising gives businesses of all sizes the ability to get in front of their ideal customers with precision and flexibility. Whether you're just starting out or looking to expand your current marketing efforts, digital advertisements offer measurable ways to increase visibility, drive traffic, and grow sales.
Start with a clear strategy and be willing to test and learn. You don't need to master every platform or advertising type at once. Pick one or two channels that align with your goals and audience, run focused campaigns, and use the data you collect to improve your approach over time.
Mailchimp helps businesses plan, manage, and optimize their online advertising campaigns from a single platform.
With tools for audience segmentation, creative development, campaign management, and performance tracking, you can run effective advertising campaigns without needing a large team or extensive technical expertise.
Whether you're new to online advertising or looking to improve your results, Mailchimp provides the resources and insights you need to reach your customers where they are and achieve your business goals.