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two coworkers in an office setting with tablet smiling after reading ISBM’s guide to digital advertising

The ISBM Guide to Digital Advertising

November 30, 2023

In the digital age, businesses are constantly seeking effective ways to reach their target audience and drive conversions. One of the most powerful tools in a marketer’s arsenal is Search Engine Optimization (SEO). 

SEO tactics are essential for digital advertising as they help businesses rank higher on search engines, making them more visible to potential customers. 

But how do businesses, especially those in the B2B sector, respond to digital advertising compared to consumers? A recent study, Long Lags and Large Returns: Experimental Evidence from Advertising to Businesses, provides some illuminating insights.

Quick Takeaways

  • The study underscores the pivotal role of SEO in digital advertising, emphasizing tactics like long-tail keywords, content quality, and technical optimization.
  • The Institute for the Study of Business Markets supported a comprehensive study, backed by experienced researchers, to explore business responses to digital advertising.
  • Businesses making high-involvement purchases exhibit distinct advertising responses, often yielding larger returns than typical consumer-focused campaigns.
  • Extended purchase cycles in B2B sectors lead to delayed advertising effects, challenging the assessment of advertising effectiveness.

Intro to Experimental Evidence from Advertising to Businesses

The comprehensive study was spearheaded by the Institute for the Study of Business Markets (ISBM). ISBM is renowned for its rigorous, peer-reviewed research and dedication to advancing the knowledge and practice of business-to-business markets. 

The researchers behind this study, Michael Thomas, Marcel Goic, and Kirthi Kalyanam, are distinguished scholars with extensive experience in business marketing and advertising. Their credentials range from PhDs in Marketing from top-tier universities to years of practical experience working with global corporations.

The motivation behind this research was to bridge the knowledge gap in understanding how businesses, especially those making high-involvement purchases, respond to digital advertising compared to consumers. 

Given the increasing shift towards digital platforms and the significant investments businesses make in digital advertising, it was imperative to explore the intricacies of B2B advertising responses. 

Key Findings from the Study

The findings of this study not only shed light on the unique dynamics of business advertising, but also provide actionable insights for marketers aiming to optimize their digital advertising strategies.

1. High-Involvement Purchases vs. Low-Involvement Products

The study, conducted on a large scale, revealed that businesses making high-involvement purchases respond differently to advertising than consumers buying low-involvement products. 

graphic shows the difference between low involvement and high involvement decisions

Specifically, business advertising has the potential for larger returns than what is typically observed from consumers. This is attributed to factors such as higher switching costs and longer-lasting relationships in the business setting.

2. Balance of Product Involvement and Search Costs

The significant impact of advertising in the business setting is achieved through a balance of product involvement and search costs. 

Products with lower search costs and higher involvement, or those with low involvement like Consumer Packaged Goods (CPG), may not witness such a pronounced effect.

3. Delays in Advertising Effects

Due to the extended purchase cycles of business customers, there are substantial delays in responses to advertising. However, businesses can maintain this information introduced through advertising for long periods. 

As an example, a surge in first-time purchases due to advertising can be observed up to five months after the ad’s display.

4. Challenges in Assessing Advertising Effectiveness

The delayed purchase cycles present challenges for businesses trying to gauge the effectiveness of their advertising. Standard cross-sectional experimental designs might not provide informative results in this context. 

However, varying the timing of ads can enhance the estimates of Return on Advertising Spend (ROAS) significantly.

5. Existing Customers vs. New Customers

The study also found that existing customers had a larger response to advertising than new customers. This contrasts with findings in consumer literature. 

graph shows that existing customers had a larger response to advertising than new customers

This result might be due to imperfect information sharing within companies across different departments. It suggests that businesses should view their existing customers as a significant opportunity for generating demand.

SEO Tactics for Digital Advertising

Given the insights from the study, it’s clear that SEO plays a crucial role in digital advertising, especially for businesses targeting high-involvement purchases. Here are some SEO tactics tailored for such businesses:

1. Long-Tail Keywords

Given the specific nature of high-involvement purchases, businesses should focus on long-tail keywords. These are phrases that are more specific and often longer than commonly searched keywords. 

Approximately 68% of online experiences begin with a search engine. By targeting long-tail keywords, businesses can reach a more niche audience that’s closer to making a purchasing decision. It also allows for better targeting and often results in higher conversion rates.

2. Content Creation

High-quality, informative content is the backbone of any successful SEO strategy. For businesses targeting high-involvement purchases, it’s essential to produce content that addresses the unique pain points and needs of their audience. 

This could be in the form of in-depth articles, whitepapers, or case studies. Such content not only positions the business as an industry expert, but also helps in attracting and retaining potential customers.

3. Optimize for Local Search

If a business caters to a local audience, it’s crucial to ensure that the website is optimized for local search. More than 30% of all mobile searches are related to location.

4. Backlink Building

Backlinks, or links from other reputable websites to your own, are a significant ranking factor for search engines. Establishing authority in a niche involves getting backlinks from industry-relevant websites. 

This can be achieved through guest posting, collaborations, or by producing share-worthy content. A strong backlink profile not only boosts SEO, but also increases the website’s credibility in the eyes of potential customers.

5. Technical SEO

The technical aspects of a website play a crucial role in its search engine ranking. Ensure that the website is mobile-friendly, given the increasing number of users accessing websites from mobile devices. 

Additionally, the website should have a fast loading speed, which can be achieved by optimizing images, leveraging browser caching, and using content delivery networks. Regularly auditing the website for crawl errors and fixing them ensures that search engines can easily index the site.

Navigate the Digital Frontier Today with ISBM

This meticulous research supported by ISBM offers valuable insights into the unique dynamics of B2B advertising. The distinction between high-involvement and low-involvement purchases, the role of search costs, and the challenges posed by extended purchase cycles are just a few of the many facets reviewed by this study.

Furthermore, the study underscores the significance of SEO in the realm of digital advertising. As businesses continue to invest heavily in digital platforms, leveraging tailored SEO tactics becomes indispensable. From harnessing the power of long-tail keywords to ensuring technical excellence, these strategies are pivotal in navigating the digital advertising frontier successfully.

Ready to adapt, evolve, and strive for excellence? ISBM is a nonprofit, global network of business researchers and practitioners. Ask about how an ISBM Membership can help you now or visit ISBM today to learn more!

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