Title: MKTG 1352 Electronic Marketing
1MKTG 1352 Electronic Marketing
Class 5 Internet Advertising
2Todays Agenda
- Questions from last class?
- Finish SEM
- Internet Advertising
- Time for group work
3Advertising
- If you build it, they will come.
- Not on the Internet!!!
4Internet Advertising
- Is Internet advertising an effective advertising
medium?
5Two Questions
- What do advertisers want from consumers?
- What do consumers want from advertisers?
61. What do advertisers want from consumers?
- Money (sales)
- Trust
- Loyalty
- Information
- Recognition
- Awareness
- Referrals
72. What do Customers want from Advertisers?
- 84 of consumers stated they want control over
the types and frequency of Internet ads sent from
a specific merchant. - 64 of consumers would trust a marketer more if
they had control over the types of online
communication that were sent to them.
Online Permissions Survey, sponsored by Dotomi,
is based on 1,799 responses from Internet users
in all major regions of the United States.
82. What do Customers want from Advertisers?
- 89 of consumers would let a trusted marketer
share their personal interests with a third
party, in order to increase the quality of
services and products produced. - 82 of consumers wanted to be notified by an
online merchant if they are provided with an
incentive - 92 asked to be notified if a product or
promotion would be of great value to them based
on past purchasing habits.
Online Permissions Survey, sponsored by Dotomi,
is based on 1,799 responses from Internet users
in all major regions of the United States.
92. What do Customers want from Advertisers?
- To summarize, customers want advertising based
on - Permission
- Value
- Relevance
10Online Advertising Continues Rapid Growth
- eMarketer predicts that more than 12 billion
will be spent this year on Internet advertising,
double 2004 levels. - By 2009, that's expected to reach 22 billion.
- Search marketing continued to dominate, grabbing
40 percent of the total online ad spending in the
quarter. - Rich media advertising rose 26 percent in the
quarter - http//www.ecommercetimes.com/story/F5V2QnRSncyYYH
/Online-Advertising-Continues-Rapid-Growth.xhtml
11(No Transcript)
12Top Advertising Vehicles
13Top Online Advertisers Dec 2004
14Canadian Online Advertising Grows 2004, 2005
- Online Revenues will exceed 500 million dollars
in 2005 Interactive Advertising Bureau of Canada
(IAB). - 43 more than the 2004 figure.
- Display ads are largest portion of the Online
advertising pie at 45 , while Search advertising
grew to 30 - Classified/Directories/Direct Response at 22 of
total revenue, and E-mail at 3 percent. - Recent research by Ipsos-Reid's shows that the
Internet has eclipsed Radio in popularity among
all wired Canadians, and actually exceed TV in
the 18-34 demographic. - Online advertising represents 4 of the total
advertising dollars.
15Still Only a Small Piece of the Pie (but growing)
16 Search Advertising
- This primarily represents the money spent on pay
per click search engine advertising - Based on keyword bidding
17Natural Results
Paid Results
18Banner Ads
- Nearly every web site that incorporates
third-party advertising as part of their revenue
model displays banner ads - This is particularly true of consumer portal
sites like Yahoo!, mytelus.com, msn.com etc. and
community sites - Clicking on a banner ad usually takes you
directly to another web site
19Banner Ads come in all shapes and sizes
20Paying for Banner Ad Campaigns
- Normal click rates for banner ads are approximate
1/2 of 1 (.62 in Q4 2003). - Banner ad campaigns that generate click rates
above 1 are considered to be highly successful. - The cost of banner advertising is dependent on
several factors, including - Size of the banner ads
- Size of the campaign budget (rates decrease with
larger budgets) - Criteria for targeting the banner ads (the more
effort that goes into targeting a banner ad, such
as tying a banner ad to a keyword or phrase, the
higher the cost) - Popularity of the site(s) where the banner ad is
to be placed.
21Banners Just Like Print Ads
- Interactive advertisers originally thought they
could command a premium for interactivity, but
the premium was set too high - The impact of banner ads is more like traditional
media - Improved awareness, branding, etc.
- The expectation of immediate sales has been
adjusted to also value the view through rate
some action will be taken within a certain period
of time after the ad has been viewed (e.g. 30
days), but not immediately
22Sponsorship An Alternative to Banner Ads
Sponsorship Links
23Banner ads versus sponsorships
Banner ads small rectangles that appear on the
top, bottom, and sides of the content on a
variety of web sites.
versus
Sponsorships long-term promotional agreements
with a few sites.
24Sponsorship Opportunities
- Targeted content - Specific areas within your
site that appeal to special interests - E-mail
- Contests/surveys
- Webinars
- Subscriptions - Economist.com has offered
sponsored subscriptions (Day Pass) which they
sell as a lead generation tool for advertisers - Blogs
- Streaming video
25Pop-Ups and Pop-Unders
- Pop-Up ads are windows that pop-up after you
click on a hyperlink to go to another web page. - Pop-Ups appear on top of other browser windows
- Pop-under ads are served "behind" all open
browser windows - Pop-Up ads can be annoying, because they
represent "in your face" advertising.
26Pop-Ups and Unders
- Costs are at least twice those of banner ads
- Pop-up ads originated with adult-content Web
sites, but have become prevalent at mainstream
sites (including PCWorld.com). - By July 2003, pop-up and pop-under ads hit their
peak at 8.7 of all online ads but have declined
steadily since
27Why did pop-ups become so pervasive?
- They are 13 times more effective at generating
clicks than standard banners!!
28Beware Anti Pop-Up Software
- About 20 of surfers use pop-up blocker software
(some advertisers think this is as high as 80) - Available as a standard feature in IE, Firefox,
Safari, etc. - Mozilla's Firefox actually enables its users to
block all of a Web page's display advertising by
installing an extension for the browser. - Firefox represents about 7 of the browser
market though it's surpassed Netscape.
(Microsoft's Internet Explorer still has roughly
84 market penetration.) - Google and Yahoo toolbars also offer this feature
29Rich Media
- The next wave in advertising?
- As people have broadband connections the usage
and effectiveness of rich media will increase for
branding purposes and "indirect response"
advertising - Some of the many forms
- Interstitials
- Banners
- Floating
- Full Screen
- http//www.webqem.com/portfolio/index.cfm?section
search_results
30Rich Media
- More effective than traditional ads (pop-ups or
banners) - 5 times the click through rate
- Twice the post impression conversion
- Big improvements in brand awareness
- Better latent impact
- Drawbacks
- Higher production costs
- Can be annoying for dial-up or high-speed lite
users
31Rich Media
32Mobile Advertising
- Current examples
- Mobile advertising revenues are expected to
capture 2 of online advertising spend - Over the next few years 88 of all handsets sold
globally to be video-enabled - Microsoft and others like Thumbdance offer mobile
content channels - Lighteningcast launched a mobile video
advertising solution that allows mobile providers
to insert ads into both real-time broadcast and
on-demand video content.
33Ad Pricing Models
34Internet Advertising Agencies
- To manage a banner ad campaign, companies
normally outsource to advertising agencies such
as Doubleclick or 2/47 Media. - Internet advertising agencies have advertising
partners -- web sites where they place banner
ads.
35Metrics Used by Advertisers to Evaluate Online
Advertising Campaigns Effectiveness
36Advertisers Too Heavily Focused on Quantitative
Metrics
- Advertisers continue to focus heavily on a few
quantitative results such as cost per click and
cost per customer - Some metrics have been ignored, such as such as
Customer Lifetime Value and Cost per Shift in
brand perception. - Tracking immediate response, extended response,
cross-channel response, and brand impact before
calculating ROI is essential.
37Integrated Marketing Communications (IMC)
- Integrated Marketing Communications (IMC)
postulates that a variety of communication
disciplines must work together to ensure maximum
clarity, consistency and communication impact. - Communication disciplines include advertising,
computer-mediated communication, direct
marketing, sales promotion, and public relations.
38IMC (continued)
- Integration of the message allows the development
of a unique and strong brand image. - IMC Promotion (in the 4 Ps)
- Examples URL Everywhere (prints ads, direct mail
brochures, letterhead, Email, business cards,
schwag, etc.)
39IMC on Super Bowl Sunday
- Super Bowl Ads
- Go Daddy.com used URL, blog and controversy to
create buzz for an ad pulled mid game in 2005 - Heres this years ad
- Ability to view the ads over again on website (at
a fraction of the 2.5 million cost) - AOL conducted an online poll for the best Super
Bowl ad
40Top Gaining Super Bowls Advertiser Web Sites
(2005)
41The Telus IMC Example
- Telus, the dominant local phone company,
practices IMC with common elements - Simple messages in plain language
- Animals/nature themes
- Vibrant colours on a white background
- Music!
- Multiple media TV, Radio, Billboards, DM, Web,
Email, Telemarketing, Print, Coffee Sleeves, POP
Display Ads
42Telus (continued)
- Business lines use different themes for their
campaigns in each quarter - Benefits to Telus
- Cost savings simple creative re-used in
different mediums for each campaign lowers costs - Consistent, simple message reinforced by
different mediums
43Telus (continued)
- IMC challenges
- Coordinating the work and schedules of multiple
agencies or selecting the lead agency for a
campaign - Forcing agencies to use creative content that may
not be theirs
44IMC Makes Measurement Difficult
- Measuring the effectiveness of one media over
another is hard when practicing Integrated
Marketing Communications (IMC) - Post-campaign research might help, but it is
expensive and probably not accurate (which medium
really triggered a response or sale?) - Landing pages are often used
- Only tracks immediate response for click through
- Most people dont remember the complex url
45View Through versusClick Through
46Behavioral Targeting
Offering ads based on contextual or behavioral
factors
- The content of the site
- Behavioral variables
- Sites you have visited
- Searches performed
- Content viewed
- Products have you purchased
- Client site visits/conversions
- Email/newsletter list membership
- User interest category
- Demographic/psychographic variables
- Geography
- Day part/day of week
- Gender
- At work/at home
- Technical variables
- Connection speed
- Browser/OS
- ISP/domain
473 Types
- Single site
- Provide ads based on what content you have seen
or your browsing and purchasing behavior on a
given site - E.g Snapple Meal Replacement and iVillage
483 Types
- Ad Networks
- Tracking behavior across sites using ad network
using 3rd party cookies - Advertising.com, 24/7 Real Media, Drive
Performance Marketing - Desktop based
- Adware and Spyware
49Adware / Spyware
- Adware programs bundled with other downloaded
software that monitor consumers' Web browsing and
serve them ads based on their online habits (e.g.
toolbars, freeware) - Spyware is Adware that tracks a user's
personal information and passes it on to third
parties, without the user's authorization or
knowledge. - Huge privacy concerns and outcry
- Limited appeal
- Works for consumer-products where people are
willing to give up personal data in exchange for
something of value (i.e. music downloads)
50Next Class
- Lab Assignment 1 Due (Word doc is on WebCT in
Lectures section) - Personalization and Permission Marketing
- In-Class Permission Marketing Exercise
- Group Project Working Time