UC Irvine

Understanding the impact of display advertisements on consumer online search behavior is an important research area. The effectiveness of display advertising was initially evaluated by using simple proxies, such as the clickthrough rate and conversion probability. However, the clickthrough rate has shown decreasing performance over time, and prior literature has shown that the impact of display ads on conversion probability has mixed findings. This creates concerns about whether online display advertising is indeed effective. Moving beyond using clickthrough rate and conversion probability, this dissertation adds to the literature of display advertising by evaluating ad effectiveness by using new consumer behavior variables that offer an insight into consumer online search behavior. We argue that online display ads shape consumers’ purchase decisions indirectly by impacting how consumers conduct product searches. Additionally, prior literature does not distinguish between different online display advertising strategies. In this dissertation, we examine how different strategies may impact consumer online search behavior in different ways. We leverage consumers’ clickstream data from a major U.S. automotive website that allows consumers to search for information about vehicles and submit leads to the dealers. We find that different online display advertising strategies are associated with distinct effects on consumer online search behavior. While browsing a product, exposure to the advertisements for the same product can encourage more intensive product viewing intensity and a higher probability for the product revisit. On the other hand, consumers who are newly attracted to the product through having been exposed to its advertisement while browsing competing products are associated with less product search intensity, compared to consumers who browse the product without having been exposed to its advertisements. Finally, for the directions for future research,we study the online search behavior of consumers who use multiple devices (i.e., desktop and mobile platforms) during their online path to purchase to gain insights into the effect of online display advertisements on these consumers. Our preliminary analysis shows that for these consumers, having a desktop platform browsing session anywhere in the consumer online search journey is associated with a higher probability of conversion. Moreover, exposure to the product’s ads on a mobile platform is associated with a higher probability that the consumer will browse for the advertised product on a desktop platform subsequently.