Plain answer
Search ads answer demand that already exists — someone types what they need and your ad appears. Display ads create or remind: banners across websites and apps shown to people who weren't looking. Search converts higher and costs more per click; display is cheaper and works best for retargeting, not cold selling.
The real difference: intent
A search ad meets someone mid-question — "emergency plumber ottawa" — which is why search clicks cost more and convert more: the buyer raised their hand first. A display ad interrupts someone doing something else: reading news, checking weather, playing a game. The person wasn't looking for you, so display clicks are cheap and conversion is rare.
Neither is "better." They're different tools: search harvests demand that exists; display builds awareness and reminds people who already met you. Judging display by search's conversion standards — or paying search prices for display-grade intent — is how each one gets unfairly condemned.
Which should a small business run first?
Search, almost always. It's the shortest line between budget and revenue because intent is already there — you're answering, not persuading. Display earns its place later, in two jobs it's genuinely good at: retargeting people who visited and didn't buy, and staying visible through a long buying cycle. Cold display to strangers is the most common way small budgets evaporate with nothing to show.
What this means for your ads
Map the choice to your funnel: search for the bottom, where buyers are deciding; display for the middle, where they're remembering. Start with search until it's capturing the demand that exists, then add display retargeting to recover the visitors who leaked out. Expanding in that order means every display dollar works on people search already warmed up.
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