What Is Paid Media? – Shafna Ashraf

Turning paid ads into profit is a proven path to scalable, predictable growth.

When you nail it, paid media gives you a steady stream of customers, without depending on Google’s latest update or social media’s shifting algorithms. In fact, digital ad spend hit $259B in 2024 and is expected to keep growing.

A graphic that says "What is Paid Media?"

But which channels are right for you? How can you weave them together into an effective strategy? And what’s the best way to measure your performance?

Here’s what you need to know.

Key Takeaways

Paid media is any form of advertising you pay to place on platforms you don’t own, like Google ads, Facebook posts, banner placements, or influencer partnerships.
The big three categories are display ads (banners and videos that stand out), native ads (sponsored posts that blend in), and traditional media (billboards, TV, radio).
Search ads and influencer partnerships are the most trusted paid channels because they catch people with intent or leverage existing relationships.
A winning campaign has seven steps: get your team aligned, set specific goals, budget for real costs (not just ad spend), know your audience, pick the right channels, create compelling ads, and optimize relentlessly.
Track five key metrics: return on ad spend (ROAS), overall return on investment (ROI), cost per click (CPC), impressions, and click-through rate (CTR). These tell you whether you’re making money or just spending it.

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Paid Media Basics

Paid media is any kind of promotion that meets two criteria: it happens on a platform you don’t own, and you pay for it.

Banner ads are everywhere, like the ones shown in the Wired article below.

Paid media drives real revenue, whether you’re running a startup or managing a global brand.

In research from my team at NP Digital, we found that paid ads make up a meaningful chunk of revenue across businesses of all sizes.

A chart showing percentage of revenue from paid ads by company size.

Paid Media vs. Earned Media vs. Owned Media

Think of marketing like a three-legged stool. The three legs here are paid, earned, and owned media.

Understanding how they work and how they work together can help you build a strategy that covers your blind spots and scales over time.

As mentioned earlier, paid media is any promotional placement you pay for. Think search ads, social ads, banner placements, influencer partnerships, and more.

Earned media is unpaid publicity that your business receives from other people and websites. It’s what others say about your brand mentions in news articles, influencer shoutouts, customer reviews, backlinks, or viral social shares.

Owned media is the stuff you fully control. Your website, blogs, social media accounts, newsletters, and email list, fall into this category. You manage the content, the experience, and the message.

Here’s how they fit together:

Paid media helps you get visibility fast, especially when you’re just starting out or entering new markets
Owned media builds trust, it’s where your brand message lives
Earned media amplifies both. It kicks in when people start talking about what you’re already doing well

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The best campaigns use all three. Paid gets attention. Owned keeps it. Earned multiplies it.

Categories and Examples: Paid Media in the Wild

Paid media is evolving fast. Search, social, video, and display are table stakes, but newer formats are gaining traction too, including ads inside large language models (LLMs) like ChatGPT and Gemini.

Even with all this growth, most formats fall into three core categories: display, native, and traditional. There’s often overlap between them, but these labels help keep things simple.

Display ads: These are visually distinct image, video, and text ads that appear alongside content on the web. Website banners, YouTube ads, and interstitial pop-ups are all examples.
Native ads: These are ads that fit within the flow of content and are often indistinguishable from it at first glance. Influencer recommendations, advertorials, and sponsorships are well-known forms of native advertising.
Traditional media: Commercials, billboards, and direct mail are examples of traditional media. You don’t get the same tracking or targeting you’d see with digital, but these channels still play a role in large-scale brand awareness.

Now that we’ve covered the broad categories, let’s break down some of the most common paid media channels, and where each one fits.

Search Engine Advertising (Search Engine Marketing)

Google, Bing, Yahoo, and even Amazon.

While Google Ads dominates the space, Bing Ads (now part of Microsoft Advertising) can offer lower CPCs (cost per click) and a different audience, especially for B2B brands. Amazon Ads also work well for product-heavy businesses.

We found that search ads across platforms drive some of the highest conversion rates in paid media, second only to channels like LinkedIn and influencer marketing.

A graphic showing average conversion rate by channel for ads.

Here’s what the advertising process looks like:

Open an account with the ad network (like Google or Bing)
Choose the keywords you want to appear for, such as “gardener in Arizona”
Set your maximum bid for those keywords (top bidders appear first)
Create your advertisement, which will be text-based
Launch your campaign and let Google serve your ad on relevant SERPs

The benefit of SEM is intent. You’re targeting users who are already searching for what you offer, which puts them closer to a buying decision.

And if you’re willing to bid competitively, your ad can appear above the organic result, even above your competitors.

Here’s an example of search engine ads for the keyword “paid media consultant.” Note the “Sponsored” label, which helps users distinguish paid ads from organic results.

Third-Party Banner Ads

Banner display ads are shown on a third-party online property, usually a website or app.

Most people think banner ads only appear at the top of pages. Not true. Inline banner ads also show in the flow of content. A banner ad is simply a square or rectangular display ad (an ad that is distinct from surrounding content).

NP Digital research shows that banner ads are the least trusted of all paid media formats, underperforming search and influencer ads significantly.

An NP Digital graphi showing trust in advertising by channel.

That said, banner ads are good at raising brand awareness. As customers see the same ad repeated across different websites, “brand memory” strengthens. The average person needs to see a brand at least seven times before they make a purchase.

Here’s an example of a fairly conspicuous banner ad on UK news site the Daily Mail:

The Google Display Network, the world’s biggest display network, consists of over two million websites and mobile apps that businesses can display their ads on—reaching 90 percent of web users worldwide. When someone clicks on an ad, Google Ads and whoever hosted it share the spoils.

Social media advertising is big business. The global market was worth an impressive $252.95 billion at the end of 2024, and this is set to grow in the future.

According to NP Digital research, Facebook generated over $100 billion in ad revenue last year, making it the top-performing social ad platform. Instagram followed at $70.9 billion.