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What is digital advertising? 4 ways to grow your business

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Key takeaways

  • Online advertising increases brand awareness and engages customers who may otherwise not have frequented your business.
  • Online ads are highly targeted and can give you insight into customer demographics and behaviors.
  • Social media advertising and paid search advertising are the most turnkey channels for small brick-and-mortar businesses—especially if you’re new to running online ads.

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Having an established digital presence can set your business apart from competitors. There are four main branches of digital advertising to consider: social media, paid search, native, and display. 

While entering the digital marketing space can be intimidating—with a wide range of ad solutions and jargon like SEO, CPC, and SERPs—the basics can be easily mastered, making it an easy and effective way to promote and grow your business.

This guide will help you understand the different types of digital advertising so you can start using these powerful channels to grow your business. Learn the benefits of using digital ads and the four main areas you should be thinking about.

How can digital advertising grow your business?

Digital advertising increases brand awareness and encourages customers to engage with your brand. It can help bring new customers through the door and reengage previous customers who are familiar with your business.

Small businesses typically use digital advertising to support current promotions and capture new customers. It puts your business on a customer’s radar, especially when first launching your business.

It can be a little tricky, however, tracking your return on investment for digital advertising with a brick-and-mortar business. How can you tell how many people came to your store specifically after seeing an online advertisement?

While the lines can be somewhat blurred, there are success indicators like website visits, lead capture, and conversion rates you can use to help estimate your return on investment with digital ads.

Benefits of digital advertising

Digital advertising is beneficial for several reasons. It supports your organic marketing efforts, helps you understand your customers, and gives you valuable information to adjust your messaging.

Organic marketing efforts are any advertising instruments that you don’t have to pay for. This can include your website, blog, email marketing, or search engine marketing (SEM).

Think of organic marketing as your vehicle and paid digital advertising as the fuel that keeps the wheels turning. Even excellent businesses with top-notch services need to attract new customers. Paid digital advertising can lend a hand.

For example, let’s say you’re a local coffee roaster and have already launched your website. Your site looks flawless, but for some reason, your monthly traffic is stagnant. Paid digital advertising can increase new visitors to your website and convert them into paying customers down the road.

Digital advertising platforms also give you access to a wealth of data. You can gain insights on customer demographics and understand exactly who your customers are instead of guessing. You can then use this information to experiment with messaging and adjust ongoing promotions.

4 types of digital advertising

The four main types of digital advertising are social media, paid search, native, and display advertising. Using one or more of these ad channels can help you establish an online presence and convert prospects into real customers.

1. Social media advertising

Social media marketing is one of the best ways to interact with potential customers online. Seventy-two percent of adults in the U.S. use at least one social media site.

On top of that, internet users spent an average of two hours and 22 minutes per day on social media in 2019. Those numbers provide a huge opportunity for your business.

With so many social media users, you can leverage customer data to create highly targeted ads for your chosen audience. You also have the option of producing ads in a variety of formats that make sense for your business.

Let’s take a closer look at popular social media platforms to see how you can use them to advertise to your customers online.


Facebook is a powerful social media advertising platform. It has the most diverse user demographics and gives you the greatest control of audience targeting. You can identify who you want to reach, place an ad in their newsfeed, and convert them into a paying customer.

You can choose to target audiences based on age, location, and personal interests. You can also retarget customers who have already interacted with your business—whether they visited your website or liked your Facebook business page.

Facebook gives you an arsenal of ad types. You can create photo ads, video ads, or Facebook story ads to drive people to your website, follow your Facebook page, or sign up for your email list.

Pros: Facebook’s specific audience-targeting ability is unlike any other platform. You can target micro-audiences, customers who have done business with your competitors, and retarget your previous customers.

Cons: Businesses have realized the effectiveness of Facebook ads, which has increased the cost of ad buys. You may have steep competition, but it’ll be worth it if you can outsmart your competitors and win over local customers.

There are many factors that can drive up the cost of ad buys, which may put you outside of your budget. However, it can be worth it if you are able to outsmart your competitors and win over local customers.

Other social media ad options

While Facebook may be best suited for small businesses that are just starting to use social media advertising, there are other social media platforms that can be more effective for advertising your particular business.

  • Twitter: Twitter’s platform is a powerful tool for organic reach with your customers. You can run Twitter ads, but it may be difficult for brick-and-mortar companies to realize any worthwhile results.
  • LinkedIn: LinkedIn is an excellent channel for creating business-to-business (B2B) ads. You have the benefit of targeting ads based on criteria like job title and job industry. Keep in mind that LinkedIn is a professional community, so only consider running ads there if it aligns with your business model.
  • YouTube: Video ads typically have high engagement rates with customers. The downside is that the video content necessary to create YouTube ads requires a great deal of production. They’re also quite pricey in comparison to other types of digital advertising.
  • Pinterest: Pinterest offers a great advertising option for connecting with a predominantly female audience. However, the platform is more suited for e-commerce businesses looking to sell items online.
  • Snapchat: Snapchat users are typically between ages 18–24, making it an ideal channel for reaching a younger audience.

2. Paid search advertising

When you need to find the best local cafe or most reputable barber in your area, what do you do? You probably look around on Yelp or search your browser for something like “best cafe near me.”

Paid search ads appear at the top of search engine results pages (SERPs) like Google, Bing, and Yahoo. Customers are actively searching for something very specific, which presents a prime opportunity for you to immediately catch their attention and direct them to your website.

Like social media advertising, paid search ads let you target customers according to age, location, and interests. The difference with search ads is that specific keywords are used to target what customers are researching.

Many paid search ads platforms allow you to target specific keywords and phrases as well as broad matches. Some platforms, like Yelp Ads, allow you to block certain keywords. This type of keyword targeting gives you more control over who will likely see your ad, allowing you to reach more relevant customers.

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Paid search advertising follows a cost-per-click (CPC) pricing model. This means you’ll only pay for ads that customers actually click on.

Pros: You’ll capture your target audience’s attention when it matters most—while they’re actively searching for specific terms.

Cons: Search ads are text-based and aren’t visually appealing. It also takes money to make money. You must invest in your marketing strategy and be confident that you’ll yield a high return on investment.

3. Native advertising

Native advertising involves partnering with an online publisher to create sponsored content that relates to your industry but isn’t specifically about your business. They then share on their website and social platforms. The intent is to create useful and engaging content that doesn’t feel like an advertisement.

For example, let’s say you run a cafe that uses locally grown produce from your area. You could partner with an online publisher to create “advertorial” content—advertisement + editorial—that highlights local urban farmers and their impact on the community.

This article would then be published with the disclosure that the content is sponsored or promoted by your company. While it is still a paid ad, customers will appreciate your company’s authenticity if the content is engaging, insightful, and educational.

Pros: You build customer trust and appear genuine and authentic rather than spamming customers with ads. You can also use this method to introduce a new product or help correct a certain public perception.

Cons: There’s a great deal of work that goes into producing native ads. It may also be a small return on investment compared to other types of digital advertising.

4. Display advertising

When most people think of online advertising, display advertising usually comes to mind. These are the banner ads, pop-ups, and promotional image tiles that appear on websites and apps across the web.

Businesses can work with platforms like Google Display Network and Facebook’s Audience Network to create display ads and target relevant customers. The targeting capabilities of these tools is quite impressive. However, display ads tend to have little impact on your business.

Display ads can help drive brand awareness, but not much else. They have an incredibly low average click-through rate of 0.35% and can come off as intrusive and annoying to customers. Most people ignore display ads or even download ad blockers to avoid them completely.

Pros: You can build brand awareness in a highly targeted environment on websites your customers are using.

Cons: Engagement rates are low, and people tend to ignore most display ads they see.

What makes sense for your business?

The types of digital advertising channels you should choose depends on the nature of your business and what you want to accomplish. 

Social media ads will allow you to create highly targeted and engaging visual ads. Paid search advertising offers an opportunity to intercept potential customers who are actively searching for relevant terms. If you’re simply trying to increase brand awareness, then perhaps native advertising or display advertising is right for you. 

Before jumping into paid digital ads, start with the basics. Make sure your online information is clear, consistent, and accurate. Use the free tools available on many of the platforms mentioned above—like creating a free Yelp Business Page—to establish and grow your business presence online.

Small Business Guide

The information above is provided for educational and informational purposes only. It is not intended to be a substitute for professional advice and may not be suitable for your circumstances. Unless stated otherwise, references to third-party links, services, or products do not constitute endorsement by Yelp.