Paper Number
ICIS2025-2316
Paper Type
Complete
Abstract
Leveraging a field experiment in collaboration with a leading Chinese online food delivery platform, this study investigates how display ads affect the performance of search ads, measured by click-through rate (CTR), conversion rate (CVR), and return on investment (ROI), as well as the moderating role of city characteristics, including consumption capacity and market size. Results show that while display ads do not boost search ad CVR, they significantly enhance CTR and ROI, suggesting a complementary relationship between the two ad formats. Furthermore, the spillover effect of display ads on search ad performance strengthens with higher city-level consumption capacity. Notably, the impact of display ads on search ad CTR and CVR is weakest in small-market cities, whereas their influence on ROI is most pronounced in large-market cities. These findings may help sellers optimize ad budgets allocation and guide platforms in designing effective ad portfolio strategies in the online food delivery market.
Recommended Citation
Chen, Guo; Zhao, Hongying; and Liu, Luning, "Search Ads Amplified: The Role of Display Ads in Online Food Delivery Platforms" (2025). ICIS 2025 Proceedings. 13.
https://aisel.aisnet.org/icis2025/da_bus/da_bus/13
Search Ads Amplified: The Role of Display Ads in Online Food Delivery Platforms
Leveraging a field experiment in collaboration with a leading Chinese online food delivery platform, this study investigates how display ads affect the performance of search ads, measured by click-through rate (CTR), conversion rate (CVR), and return on investment (ROI), as well as the moderating role of city characteristics, including consumption capacity and market size. Results show that while display ads do not boost search ad CVR, they significantly enhance CTR and ROI, suggesting a complementary relationship between the two ad formats. Furthermore, the spillover effect of display ads on search ad performance strengthens with higher city-level consumption capacity. Notably, the impact of display ads on search ad CTR and CVR is weakest in small-market cities, whereas their influence on ROI is most pronounced in large-market cities. These findings may help sellers optimize ad budgets allocation and guide platforms in designing effective ad portfolio strategies in the online food delivery market.
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