Do banner ads still work in 2025?

Short answer: Yes — but context matters.

Banner ads continue to be a meaningful part of digital marketing mixes in 2025, especially when they’re used for the right objectives, on the right inventory, and with modern measurement and creative practices. The channel is evolving fast — programmatic plumbing, retail media growth, privacy shifts, and richer creative formats all change how banners perform. This guide walks through the evidence, the limitations, and practical playbooks for making banner campaigns that deliver today.

Why this question matters now

Digital advertising is in transition. Ad budgets are large and growing globally, but the technical and regulatory landscape is shifting. Programmatic buying still dominates display spend, retail media networks are expanding quickly, and privacy initiatives have forced marketers to rethink targeting and measurement. Those forces together determine whether banner campaigns deliver return on ad spend (ROAS) or just empty impressions. (IAB, EMARKETER)

The current shape of the market

Programmatic remains the backbone

Programmatic channels handle the lion’s share of display buying: nearly nine in ten display-ad dollars transact programmatically in 2025. That means scale, automation, and machine learning power most banner delivery decisions — and it also means performance is closely tied to ad tech quality and data strategy. (EMARKETER)

Retail media is a major growth vector

Retail media (Amazon Ads, Walmart Connect, Instacart, etc.) grew rapidly in 2024 and continues to expand in 2025. Advertisers placing display-format creatives inside retail ecosystems are seeing stronger purchase intent and often better ROAS than broadly targeted open-web display. If you’re running product-focused campaigns, retail media is a place where banners can be especially effective. (Amra And Elma, Basis Technologies)

Privacy and measurement are in flux

Google’s Privacy Sandbox (Topics, FLEDGE, and related APIs) has been a multiyear experiment in replacing cross-site third-party cookies with privacy-preserving signals. The state of those changes — and the pushback they’ve provoked — affects how advertisers target and attribute display spend. There have been big developments (and pivots) in 2024–2025: browsers and regulators forced the industry to rethink timelines and technical choices, which in turn influenced performance testing and strategy. (Privacy Sandbox, The Verge)

What performance looks like in 2025 — the evidence

Attention and brand metrics have held value

Across agency and platform case studies, motion and richer creative commonly lift attention, ad recall, and brand recall more reliably than plain static images. That’s why formats like HTML5 rich media and short video remain prioritized for awareness and upper-funnel buys. If your objective is memory and reach, banners — especially dynamic or interactive ones — can still move the needle. (improvado.io, Bannerflow)

Click-through rates are modest but improving in pockets

Raw CTRs for traditional display are low compared with search: averages vary, but display CTRs historically sit under 1% in many benchmarks. Still, in 2024–25 we see pockets of improvement where creative quality, contextual targeting, or retail placements come together. In other words: average CTRs aren’t compelling on their own, but carefully built campaigns can beat those averages. (TheeDigital, Cropink)

Cost dynamics — CPMs rose, but outcomes vary by inventory

Cost per thousand (CPM) increased in 2024 across many markets as demand rebounded and publishers reduced low-quality inventory. Higher CPMs mean creative and targeting need to be sharper — wasted impressions cost more than they used to. Where you buy inventory (open web vs. curated retail media vs. premium publishers) strongly influences cost and performance. (Keywords Everywhere, IAB)

So — when do banner ads “work”?

Banner advertising performs when all of the following are true:

Your objective matches the format. Display is excellent for awareness, reach, and retargeting, while direct-response goals require tighter funnel alignment and often complementary channels.
You buy the right inventory. Curated or premium placements and retail media frequently outperform anonymous open-web buys.
Your creative is built for the moment. High-quality, context-aware visuals — and appropriate motion (HTML5 or short video where appropriate) — materially improve engagement.
You measure the right signals. Viewability, time-in-view, and on-site engagement (not just CTR) tell the real story.
You adapt to the privacy landscape. First-party data, contextual targeting, and privacy-preserving APIs are now primary levers. (improvado.io, Amra And Elma, Privacy Sandbox)

Creative matters — more than ever

Static vs animated vs rich media vs video

Static images remain fast and cheap — great for scale and retargeting.
Animated GIFs add motion but can be heavy and lossy; they’re a stopgap rather than the best technical choice.
HTML5 rich creatives offer smooth animation, interactivity, and efficient file size when well-built — often the best compromise for performance-focused display.
Short-form video ads outshine other formats in social feeds and environments where users expect motion.

Invest where the channel expects it: HTML5 and video for premium placements, static for high-volume retargeting. Creative quality will usually trump format alone. (Bannerflow, IAB)

Targeting in a post-cookie world

Cookies aren’t the only way to reach people anymore. In 2025 marketers deploy a mix of:

First-party audiences — lists, CRM signals, logged-in relationships.
Contextual and semantic targeting — matching creative to page content.
Privacy-preserving APIs (e.g., Topics) or on-device signals — when available and supported.
Retail media audiences — high-intent shopping segments within retailer environments.

The technical mix depends on the ad ecosystem you buy into; the safest path is a diversified approach that reduces reliance on any single identifier. (Privacy Sandbox, Basis Technologies)

Measurement: what to track beyond clicks

If you want to know whether banners are actually working, track these metrics in addition to CTR:

Viewable impressions and viewability rate (MRC standards remain a baseline).
Time-in-view / average exposure time — how long creative stays visible.
Post-click engagement — page depth, time on site, and conversion rate.
Assisted conversions and view-throughs — display often helps other channels convert.
Incrementality tests — geo-holdouts or randomized control experiments reveal causal lift.

Focusing on the right metrics changes how you evaluate seemingly low CTRs — display’s role is often supportive, not always the direct closer. (IAB, improvado.io)

Practical playbook: make banner ads work in 2025

Start with an objective and map a measurement plan. Decide whether success looks like awareness lift, traffic, or conversions.
Choose inventory intentionally. Prioritize premium publishers, retail media, and curated programmatic deals for conversion-focused placements.
Invest in creative that matches the placement. HTML5 or video for premium placements; crisp static for large-scale retargeting.
Optimize for viewability and speed. File size limits and progressive loading are non-negotiable.
Use first-party data and contextual signals. Prepare to run without extensive third-party identifiers.
Test incrementally and measure lift. Use A/B tests and holdouts to prove causal impact.
Blend channels. Display often works best as part of a multi-channel funnel — paired with search, social, or email. (improvado.io, EMARKETER)

Common mistakes to avoid

Treating display as a click-first channel. Expect low CTR for many placements and plan accordingly.
Buying purely on price. Cheap impressions are often invisible or low-quality.
Neglecting QA. File errors, bad click-through tags, or broken fallbacks kill campaigns.
Over-reliance on cookies. Assume identifiers can change; build first-party and contextual strategies now.
Using motion for motion’s sake. Animation must have a clear job — draw attention to the CTA or explain an offer. (Keywords Everywhere, Clearcode)

The role of new inventory types

Display is expanding into new surfaces: CTV/OTT, DOOH (programmatic digital out-of-home), and retail media. These environments require different creative approaches and measurement frameworks, but they also open new performance opportunities for banner-like creative and programmatic buying. Diversifying placements can pay off — but test first. (Adsmurai, Bannerflow)

Verdict: yes — with conditions

Banner ads remain a living, useful channel in 2025, but their value requires a modern approach:

You must match format to objective.
Buy better inventory, not just cheaper CPMs.
Use modern creative formats (HTML5/video where appropriate).
Build first-party and contextual targeting into media plans.
Measure with viewability, engagement, and incremental lift — not CTR alone.

When done right, display delivers reach, supports conversion, and — in specific placements like retail media — can drive strong direct ROI. When done sloppily, it’s expensive background noise. The difference is process and discipline. (IAB, Amra And Elma, EMARKETER)

Sources and further reading

IAB / PwC — Internet Advertising Revenue Report, Full Year 2024. (IAB)
eMarketer — Worldwide programmatic ad spending and trends (2025). (EMARKETER)
Google Privacy Sandbox (Topics / developer documentation and feedback reports). (Privacy Sandbox)
The Verge — reporting and updates on the Privacy Sandbox / cookies debates. (The Verge)
Amra & Elma / Basis / Bannerflow — data and commentary on retail media growth and programmatic trends (2024–25). (Amra And Elma, Basis Technologies, Bannerflow)
Improvado — display ad best practices and measurement advice (2025). (improvado.io)
CropInk, LeadOrigin, and other industry analyses on display effectiveness and benchmarks. (Cropink, LeadOrigin)
Various programmatic and ad-tech trend pieces (Basis Technologies, Bannerflow, Adsmurai). (Basis Technologies, Bannerflow, Adsmurai)