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In-Depth  Introduction to Internet Advertising By Greg Stuart  Co-author of What Sticks & former CEO of Interactive Advertising Bureau  (see full bio on last slide) Prepared July 2008
Goal of This Document ,[object Object],[object Object],[object Object]
Agenda ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Digital Media in Context What is the Net, where is Digital going, and what does  Media  mean?
Digital Evolution of Media ,[object Object]
What is the Internet? ,[object Object],[object Object],[object Object]
Online Media Categories ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Generally accepted types of Online Media:
The Vision for the role of  Digital Media Monologue One way Mass communication Static No interaction among customers Shotgun approach Hard to identify customers Hard to manage customers BEFORE AFTER Dialogue One-to-one marketing Real-time Dynamic Collaborative Segmented Rich customer interaction Rich customer data Customer Customers Supplier Supplier Internet
If you had to live on a deserted island and could only take one of the following with you, which would you take?
Types of Online Advertising It’s just not one media. It’s the Network and there are many options
Recent Major News About Online Advertising ,[object Object],[object Object],[object Object],“ The country’s third-largest advertiser (General Motors) is getting ready to shift fully half of its $3 billion budget into digital and one-to-one marketing within the next 3 years.”    Advertising Age   March 17, 2008  Even ad-spending giant P&G is considering cutting its overall ad budget by as much as 10% this year and aggressively moving ad dollars to the Web.  WSJ May 12, 2008
Types of Online Advertising ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Est. Spending By Category
More Types of Online Media
Online Ad Pricing Dynamics ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
All IAB Ad Units
Key is the UAP  (aka Universal Ad Package) 728x90 180x150 300x250 160x600 Border Animation Weight limits 180x150 160x600 20k 30k Flash 15 second limit None 15k 728x90 20k 300x250 GIF & JPEG Unit
Adoption of the UAP Units Four UAP Units now represent  37%  of total inventory, down 10% from Q4 ’05.  IAB Recommended IMU “Button 1” (120x90) up 15.2% from Q4 ’05. “ Button 1” = 19.6% “ Button 1” = 4.4%
Internet Advertising Revenue By Type:  Classifieds; Search Remains a Strong Leader % of ‘05 First Six-Month Revenues Total $5.8 Billion Source: PricewaterhouseCoopers LLP/IAB  Internet Advertising Report Note: Lead Gen is a new category in ’05, revised vs Referral.  Changes vs YAG are recommended % of ‘06 First Six-Month Revenues Total $7.9 Billion Should be Updated
Does Online Advertising Work? Really, does it?  And how well? (Answer sometimes 10x better than TV)
16 XMOS Public Studies to Date XMOS = Cross Media Optimization Study ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Methodology Validated by Key Industry Bodies “ This measurement approach is the most even handed to all media and extremely accurate in measuring Online’s contribution and cost efficiency.” Jim Spaeth, Former President,  The Advertising Research Foundation  ,[object Object],[object Object]
Online Sells Product (Online & Offline) Sales Lift Hi Sales Low 14% 12% 10% 8% 11% 25% 8% * Target sales lift averaged across 99 GRPs from Homepage and display ads 17% 19% Philips Motorola 2% >1% Online sales lift averaged 11% Sales lift is the % difference between actual buyers in exposed and control groups..  Calculation: Exposed – Control The lift is among those reached by online.  .  Control
Summary Of XMOS Results Online Optimization Only * Not the actual optimized level, but considered an interim increase ** Brand ran Optimal level so there was no gain from more online spending *** Because of differing objectives, cross media comparison was inconclusive +4% -- -- -- 4%* Jell-O +7% -- -- -- 5%* Coffee-mate In Field -- -- -- TBD Olay -- -- -- +1491% +1-5 % -- +20 % -- +14% Purchase Intent 6%* 11 % 15 % 19 % 10-15% 10 % 11 % 13 % 15 % Reco’d % Online +5% -- -- -- -- -- -- -- -- Sales -- *** Verisign F150 ING ET Home Video Nexium Kleenex Total Chicken Flatbread Dove Brand Image Brand Awareness Brands -- -- -- +10-20 % +7% +34 % -- -- -- ** -- -- -- -- +8% --
What Do We Know about Creative Better creative can make the difference between success and failure Source:  XMOS B A
Creative Makes a HUGE Difference Better creative can make the difference between success  and  absolute  failure Ad A
Add a New Medium is Driven by Diminishing Returns % of Brand Impact Awareness, Image or Purchase Intent 0 10 20 30 40 50 60 70 80 90 100 0 1 2 3 4 5 6 7 8 9 10 Frequency Diminishing returns 1 2 3 4 5
Adding Online Can Have Major Impact for Even McDonalds Introducing New Menu Item:    Grilled Chicken Flatbread Sandwich Ad Frequency (or Budget) % Aided Awareness 20% of Broadcast  Budget Reinvested  13.6%  in Online Point of  Diminished Returns 5pt Gain! Cut 6.4% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 0.0%
Performance is Partly Due to Media Mix Use by Consumers TV Use Online Use Heavier Heavier Lighter Lighter Heavy Online Heavy TV Heavy TV Light Online Light TV Light Online Heavy Online   Light TV 26% 38% 15% 21% Media Usage among 18-49 year old target 34.3 Million!
Trying Something Brand New: Home Page Takeover Ad  Ran One Day on Each Portal - Roadblock Roadblock 43% One Day Reach
Cost Effectiveness of Each Medium Cost to Increase  Purchase Consideration   Interpretation: If it cost Roadblock $1 (indexed at 100) to increase purchase consideration, then it cost $1.35 for Online, $4.56 for magazine and $11.04 to TV to achieve the same increase. $1.35 $1.00 $4.56 $11.04 Sample Cost 100 Roadblock 456 Magazine 1104 TV 135 Online Relative  Cost Index Brand Metric: Purchase Consideration  (top 2 box)
The Value of Small Changes Ford Media Mix * Traditional Media Plan * Approx. $200 Million Budget Online Online Result was another $750,000,000 in U.S. Truck sales  Total of +$1,350,000,000 in U.S. Truck Sales (at retail vs. Base Plan)
The Big Question: Has XMOS Caused Change in the Industry? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Change in Online’s Total Budget One Year After @ Study
Change in Online’s Share of Total Budget
What Has Been the Real Value of XMOS 30x vs. 4 YAG 18x vs. 4 YAG Avg XMOS Brand Avg Company
Online Advertising Research & Measurement And the  Issues  that do not get discussed publicly
Online Media Measurement Data is Not Good; and Yet its World Class ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Main Terms of the Medium ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Please never use the word “Hits”
Online Media Research Overview
Big Strategic Advantage was Global Internet Ad Impression Measurement Guidelines
Key Elements of Guideline - 1 of 2 ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Key Elements of Guideline - 2 of 2 ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
The Old Way: Server-side serving and counting A B C 1 : User requests content from publisher web server. 2 : Publisher web server calls Publisher Ad Engine to retrieve ads. 3 : The Publisher Ad Engine logs that it has served an ad. Publisher Ad engine returns an HTML blob to Publisher Web Server. Some of these ads may actually be pointers to a location on a Third Party server.  4 : The Publisher Web Server receives the HTML blob. 5 : The Publisher Web Server returns the page and the page begins to render on the user’s machine. 6 : While rendering the page, the browser determines that it needs to pick up an ad from a Third Party server. The browser fires off a separate thread to get the ad from the Third Party server.  7 : The Third Party server logs that it has served an ad. 8 : The Third Party server receives the request for the ad and returns a pointer to the location of the ad image by instructing the user’s browser to pick up the ad from an image server. 9 : The user’s browser makes a call to the image server where the creative resides. 10 : The Image server logs that it has served an image. 11 : The image server returns the image. 1 2 3 4 5 6 7 8 9 10 11 Publisher Web Server Publisher Ad Engine Publisher Ad Engine Log Third Party Ad Engine Log Image Server Log
Causes of discrepancies ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
The Better Way:  Client-side serving and counting A B C 1 3 4 5 2 6 7 8 9 10 11 Publisher Web Server Publisher Ad Engine Publisher Ad Engine Log Third Party Ad Engine Log Image Server Log
The Way it’s Being Done Now: Server-side serving with client-side counting A B C 1 2 3 4 5 6 7 8 9 10 11 Publisher Web Server Publisher Ad Engine Publisher Ad Engine Log Third Party Ad Engine Log Image Server Log D 5b Publisher Beacon Server Publisher Beacon Log 5a 5c
How Good is NNR and comScore Data and do They at Least Trend the Same? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Sample NY Times - Unique Visitors
Sample: NY Times - Page Views
Backbone of Measurement and Targeting – Cookies! ,[object Object],[object Object],[object Object],[object Object]
Cookie Deletion Rates by  (anonymous) Site
Ad Blocking Tracking Progress ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Ad Blocking Trends
Situation Update On Ad Blocking:  Do We Need to Act Now? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Just When we Get Set  RIA/AJAX Changes Everything ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Important Documents ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Positioning Online Advertising What Does the Research Show In How to Position Online as a Medium
The Interactive Positioning Television Print Radio Direct Mail INTERACTIVE Only Interactive Advertising lets you combine the ability to target and create a dialogue with the  AUDIENCE   that matters to your brand, lets your customer  EXPERIENCE   your brand the way THEY want to, and allows you to measure the  EFFECTIVENESS   of your marketing dollars. Interactive is the only medium that lies at the intersection of  Audience, Effectiveness  and Experience AUDIENCE EXPERIENCE EFFECTIVENESS
High Intensity Agreement with the Motivations On a scale of 1-10, how much do you agree with the following statements?   Chart represents % of the population agreeing with an 7 or above (high intensity) “ Interactive Advertising is a must have in my media mix.”   “ I will further my career if I use Interactive Advertising successfully”   “ I realize there is so much more I can do with Interactive Advertising”
Respondent Agreements with Key Motivations 6.95 63% 28% Interactive Advertising is more targeted than other media. 7.01 63% 30% Interactive Advertising is more engaging than other media. 6.7 56% 27% Interactive Advertising gives me greater impact for my advertising  dollar than other media. 5.72 44% 17% I would spend more money on Interactive Advertising, but others  in my organization disagree. 6.91 63% 25% I would spend more money on Interactive Advertising if there were  better data to prove it works. 6.47 54% 22% I would spend more money on Interactive Advertising if it were  easier to execute. 6.85 63% 26% I understand how to use Interactive Advertising to improve my  marketing efforts. 7.25 69% 34% I could do so much more with Interactive Advertising than I am  currently. 6.95 64% 29% I will further my career if I use more Interactive Advertising  successfully. 7.05 66% 33% Interactive Advertising is a “must-have” in my media mix. Mean Agree/ Strongly Agree Strongly Agree KEY MOTIVATION
Sample Segmentation By Current Attitudes to Interactive Advertising Based on composite mean scores for six motivation questions
Fence-Sitters Profile Median Revenues (in $mm) Median Ad spend (in $mm)
Print Ads
 
Trends & Data Never Enough Data.  Lots of Trends. What Does it Mean?
Global Online Population ,[object Object],[object Object]
The Internet is the 3 rd  most used medium and about to become 2 nd   only to TV Source: Forrester Research, March 2007 * Excludes work usage.
The Internet is a already a massive medium, but still growing rapidly in a variety of ways ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Internet’s reach exceeds TV’s from 7 am to 8 pm Source:  National People Meter, comScore Media Metrix 2007
The Web Already Delivers More Advertising Than TV! 2.2 x Source:  Display Impressions:  comScore Ad Metrix, Jan -08, Television GRP’s:  comScore Estimates The CPM’s are just much, much lower for Internet. Monthly GRP’s Monthly Impressions Per Person
Internet Ad Revenues Continue to Surge Quarterly Internet Advertising Revenues ($ Billions)  1998 1999 2007 2006 2005 2004 2003 2002 2001 2000 Source: Interactive Advertising Bureau (IAB), PricewaterhouseCoopers (PwC) estimates. $21.1B in 2007, Up 26%  Over 2006
Ad Dollars are Flowing Online Internet Outdoor Cable TV Magazines Direct Mail Miscellaneous Overall Trade Journals Yellow Pages Broadcast TV Radio Newspapers  $21 Billion $ 7 $26 $14 $61 $39 $295 $ 4 $14 $46 $19 $44 Media Advertising Dollars Spent in 2007* Percent Change from 2006  Source: Global Insights as published in BusinessWeek * Other sources may define categories differently, leading to different results 60% of all ad spending in traditional media goes to branding campaigns
Yet, online is only 7% of total ad spending in the U.S. 2007 Estimate ($ in Millions) Source: Advertising Age by Robert J. Coen, McCann-Erickson Inc; Newspaper Association of America; Radio Advertising Bureau; Simba Information; Outdoor Advertising Association of America; Interactive Advertising Bureau (IAB); Lehman Brothers % Total Direct Mail $  60,988 21% Broadcast TV $  45,749 15% Newspaper $  42,939 14% Internet $  21,100 7% Cable TV Networks $  20,479 7% Radio $  18,592 6% Yellow Pages $  14,538 5% Consumer Magazine $  13,695 5% All other $  55,977 19% Total $  296,100 100%
Decline in Online Ad Click-Through Rates Sources: Doubleclick, eMarketer, Eyeblaster, ABI Research estimates
Clickers Follow the 80/20 Rule Source:  comScore, Total US Online Population, July 2007   Clickers are predominantly  younger (25 - 44) with lower income (under $40K)
Those Who Viewed the Ad But Did Not Click Drove Majority of Site Engagement and Sales % of Exposed People Include View-Through Effects When Measuring the Campaign – Clicks Are NOT Enough
Clicks on Display Ads Are a Misleading Metric and They Don’t Reflect Brand-Building Effects ,[object Object],[object Object],[object Object]
Future and Other Suggestions
Future Trends to Watch ,[object Object],[object Object],[object Object],[object Object],[object Object]
Internet Video Advertising Spending Trends The hottest growth is in Video Ads on the Net Source: eMarketer
Other Suggestions ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Review of the Online Medium ,[object Object],[object Object],[object Object],[object Object],[object Object]
More at www.linkedin.com/in/gregstuart ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

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Intro To Online Advertising Greg Stuart

  • 1. In-Depth Introduction to Internet Advertising By Greg Stuart Co-author of What Sticks & former CEO of Interactive Advertising Bureau (see full bio on last slide) Prepared July 2008
  • 2.
  • 3.
  • 4. Digital Media in Context What is the Net, where is Digital going, and what does Media mean?
  • 5.
  • 6.
  • 7.
  • 8. The Vision for the role of Digital Media Monologue One way Mass communication Static No interaction among customers Shotgun approach Hard to identify customers Hard to manage customers BEFORE AFTER Dialogue One-to-one marketing Real-time Dynamic Collaborative Segmented Rich customer interaction Rich customer data Customer Customers Supplier Supplier Internet
  • 9. If you had to live on a deserted island and could only take one of the following with you, which would you take?
  • 10. Types of Online Advertising It’s just not one media. It’s the Network and there are many options
  • 11.
  • 12.
  • 13. More Types of Online Media
  • 14.
  • 15. All IAB Ad Units
  • 16. Key is the UAP (aka Universal Ad Package) 728x90 180x150 300x250 160x600 Border Animation Weight limits 180x150 160x600 20k 30k Flash 15 second limit None 15k 728x90 20k 300x250 GIF & JPEG Unit
  • 17. Adoption of the UAP Units Four UAP Units now represent 37% of total inventory, down 10% from Q4 ’05. IAB Recommended IMU “Button 1” (120x90) up 15.2% from Q4 ’05. “ Button 1” = 19.6% “ Button 1” = 4.4%
  • 18. Internet Advertising Revenue By Type: Classifieds; Search Remains a Strong Leader % of ‘05 First Six-Month Revenues Total $5.8 Billion Source: PricewaterhouseCoopers LLP/IAB Internet Advertising Report Note: Lead Gen is a new category in ’05, revised vs Referral. Changes vs YAG are recommended % of ‘06 First Six-Month Revenues Total $7.9 Billion Should be Updated
  • 19. Does Online Advertising Work? Really, does it? And how well? (Answer sometimes 10x better than TV)
  • 20.
  • 21.
  • 22. Online Sells Product (Online & Offline) Sales Lift Hi Sales Low 14% 12% 10% 8% 11% 25% 8% * Target sales lift averaged across 99 GRPs from Homepage and display ads 17% 19% Philips Motorola 2% >1% Online sales lift averaged 11% Sales lift is the % difference between actual buyers in exposed and control groups.. Calculation: Exposed – Control The lift is among those reached by online. . Control
  • 23. Summary Of XMOS Results Online Optimization Only * Not the actual optimized level, but considered an interim increase ** Brand ran Optimal level so there was no gain from more online spending *** Because of differing objectives, cross media comparison was inconclusive +4% -- -- -- 4%* Jell-O +7% -- -- -- 5%* Coffee-mate In Field -- -- -- TBD Olay -- -- -- +1491% +1-5 % -- +20 % -- +14% Purchase Intent 6%* 11 % 15 % 19 % 10-15% 10 % 11 % 13 % 15 % Reco’d % Online +5% -- -- -- -- -- -- -- -- Sales -- *** Verisign F150 ING ET Home Video Nexium Kleenex Total Chicken Flatbread Dove Brand Image Brand Awareness Brands -- -- -- +10-20 % +7% +34 % -- -- -- ** -- -- -- -- +8% --
  • 24. What Do We Know about Creative Better creative can make the difference between success and failure Source: XMOS B A
  • 25. Creative Makes a HUGE Difference Better creative can make the difference between success and absolute failure Ad A
  • 26. Add a New Medium is Driven by Diminishing Returns % of Brand Impact Awareness, Image or Purchase Intent 0 10 20 30 40 50 60 70 80 90 100 0 1 2 3 4 5 6 7 8 9 10 Frequency Diminishing returns 1 2 3 4 5
  • 27. Adding Online Can Have Major Impact for Even McDonalds Introducing New Menu Item: Grilled Chicken Flatbread Sandwich Ad Frequency (or Budget) % Aided Awareness 20% of Broadcast Budget Reinvested 13.6% in Online Point of Diminished Returns 5pt Gain! Cut 6.4% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 0.0%
  • 28. Performance is Partly Due to Media Mix Use by Consumers TV Use Online Use Heavier Heavier Lighter Lighter Heavy Online Heavy TV Heavy TV Light Online Light TV Light Online Heavy Online Light TV 26% 38% 15% 21% Media Usage among 18-49 year old target 34.3 Million!
  • 29. Trying Something Brand New: Home Page Takeover Ad Ran One Day on Each Portal - Roadblock Roadblock 43% One Day Reach
  • 30. Cost Effectiveness of Each Medium Cost to Increase Purchase Consideration Interpretation: If it cost Roadblock $1 (indexed at 100) to increase purchase consideration, then it cost $1.35 for Online, $4.56 for magazine and $11.04 to TV to achieve the same increase. $1.35 $1.00 $4.56 $11.04 Sample Cost 100 Roadblock 456 Magazine 1104 TV 135 Online Relative Cost Index Brand Metric: Purchase Consideration (top 2 box)
  • 31. The Value of Small Changes Ford Media Mix * Traditional Media Plan * Approx. $200 Million Budget Online Online Result was another $750,000,000 in U.S. Truck sales Total of +$1,350,000,000 in U.S. Truck Sales (at retail vs. Base Plan)
  • 32.
  • 33. Change in Online’s Total Budget One Year After @ Study
  • 34. Change in Online’s Share of Total Budget
  • 35. What Has Been the Real Value of XMOS 30x vs. 4 YAG 18x vs. 4 YAG Avg XMOS Brand Avg Company
  • 36. Online Advertising Research & Measurement And the Issues that do not get discussed publicly
  • 37.
  • 38.
  • 40. Big Strategic Advantage was Global Internet Ad Impression Measurement Guidelines
  • 41.
  • 42.
  • 43. The Old Way: Server-side serving and counting A B C 1 : User requests content from publisher web server. 2 : Publisher web server calls Publisher Ad Engine to retrieve ads. 3 : The Publisher Ad Engine logs that it has served an ad. Publisher Ad engine returns an HTML blob to Publisher Web Server. Some of these ads may actually be pointers to a location on a Third Party server. 4 : The Publisher Web Server receives the HTML blob. 5 : The Publisher Web Server returns the page and the page begins to render on the user’s machine. 6 : While rendering the page, the browser determines that it needs to pick up an ad from a Third Party server. The browser fires off a separate thread to get the ad from the Third Party server. 7 : The Third Party server logs that it has served an ad. 8 : The Third Party server receives the request for the ad and returns a pointer to the location of the ad image by instructing the user’s browser to pick up the ad from an image server. 9 : The user’s browser makes a call to the image server where the creative resides. 10 : The Image server logs that it has served an image. 11 : The image server returns the image. 1 2 3 4 5 6 7 8 9 10 11 Publisher Web Server Publisher Ad Engine Publisher Ad Engine Log Third Party Ad Engine Log Image Server Log
  • 44.
  • 45. The Better Way: Client-side serving and counting A B C 1 3 4 5 2 6 7 8 9 10 11 Publisher Web Server Publisher Ad Engine Publisher Ad Engine Log Third Party Ad Engine Log Image Server Log
  • 46. The Way it’s Being Done Now: Server-side serving with client-side counting A B C 1 2 3 4 5 6 7 8 9 10 11 Publisher Web Server Publisher Ad Engine Publisher Ad Engine Log Third Party Ad Engine Log Image Server Log D 5b Publisher Beacon Server Publisher Beacon Log 5a 5c
  • 47.
  • 48. Sample NY Times - Unique Visitors
  • 49. Sample: NY Times - Page Views
  • 50.
  • 51. Cookie Deletion Rates by (anonymous) Site
  • 52.
  • 53.
  • 54.
  • 55.
  • 56. Positioning Online Advertising What Does the Research Show In How to Position Online as a Medium
  • 57. The Interactive Positioning Television Print Radio Direct Mail INTERACTIVE Only Interactive Advertising lets you combine the ability to target and create a dialogue with the AUDIENCE that matters to your brand, lets your customer EXPERIENCE your brand the way THEY want to, and allows you to measure the EFFECTIVENESS of your marketing dollars. Interactive is the only medium that lies at the intersection of Audience, Effectiveness and Experience AUDIENCE EXPERIENCE EFFECTIVENESS
  • 58. High Intensity Agreement with the Motivations On a scale of 1-10, how much do you agree with the following statements? Chart represents % of the population agreeing with an 7 or above (high intensity) “ Interactive Advertising is a must have in my media mix.” “ I will further my career if I use Interactive Advertising successfully” “ I realize there is so much more I can do with Interactive Advertising”
  • 59. Respondent Agreements with Key Motivations 6.95 63% 28% Interactive Advertising is more targeted than other media. 7.01 63% 30% Interactive Advertising is more engaging than other media. 6.7 56% 27% Interactive Advertising gives me greater impact for my advertising dollar than other media. 5.72 44% 17% I would spend more money on Interactive Advertising, but others in my organization disagree. 6.91 63% 25% I would spend more money on Interactive Advertising if there were better data to prove it works. 6.47 54% 22% I would spend more money on Interactive Advertising if it were easier to execute. 6.85 63% 26% I understand how to use Interactive Advertising to improve my marketing efforts. 7.25 69% 34% I could do so much more with Interactive Advertising than I am currently. 6.95 64% 29% I will further my career if I use more Interactive Advertising successfully. 7.05 66% 33% Interactive Advertising is a “must-have” in my media mix. Mean Agree/ Strongly Agree Strongly Agree KEY MOTIVATION
  • 60. Sample Segmentation By Current Attitudes to Interactive Advertising Based on composite mean scores for six motivation questions
  • 61. Fence-Sitters Profile Median Revenues (in $mm) Median Ad spend (in $mm)
  • 63.  
  • 64. Trends & Data Never Enough Data. Lots of Trends. What Does it Mean?
  • 65.
  • 66. The Internet is the 3 rd most used medium and about to become 2 nd only to TV Source: Forrester Research, March 2007 * Excludes work usage.
  • 67.
  • 68. Internet’s reach exceeds TV’s from 7 am to 8 pm Source: National People Meter, comScore Media Metrix 2007
  • 69. The Web Already Delivers More Advertising Than TV! 2.2 x Source: Display Impressions: comScore Ad Metrix, Jan -08, Television GRP’s: comScore Estimates The CPM’s are just much, much lower for Internet. Monthly GRP’s Monthly Impressions Per Person
  • 70. Internet Ad Revenues Continue to Surge Quarterly Internet Advertising Revenues ($ Billions) 1998 1999 2007 2006 2005 2004 2003 2002 2001 2000 Source: Interactive Advertising Bureau (IAB), PricewaterhouseCoopers (PwC) estimates. $21.1B in 2007, Up 26% Over 2006
  • 71. Ad Dollars are Flowing Online Internet Outdoor Cable TV Magazines Direct Mail Miscellaneous Overall Trade Journals Yellow Pages Broadcast TV Radio Newspapers $21 Billion $ 7 $26 $14 $61 $39 $295 $ 4 $14 $46 $19 $44 Media Advertising Dollars Spent in 2007* Percent Change from 2006 Source: Global Insights as published in BusinessWeek * Other sources may define categories differently, leading to different results 60% of all ad spending in traditional media goes to branding campaigns
  • 72. Yet, online is only 7% of total ad spending in the U.S. 2007 Estimate ($ in Millions) Source: Advertising Age by Robert J. Coen, McCann-Erickson Inc; Newspaper Association of America; Radio Advertising Bureau; Simba Information; Outdoor Advertising Association of America; Interactive Advertising Bureau (IAB); Lehman Brothers % Total Direct Mail $ 60,988 21% Broadcast TV $ 45,749 15% Newspaper $ 42,939 14% Internet $ 21,100 7% Cable TV Networks $ 20,479 7% Radio $ 18,592 6% Yellow Pages $ 14,538 5% Consumer Magazine $ 13,695 5% All other $ 55,977 19% Total $ 296,100 100%
  • 73. Decline in Online Ad Click-Through Rates Sources: Doubleclick, eMarketer, Eyeblaster, ABI Research estimates
  • 74. Clickers Follow the 80/20 Rule Source: comScore, Total US Online Population, July 2007 Clickers are predominantly younger (25 - 44) with lower income (under $40K)
  • 75. Those Who Viewed the Ad But Did Not Click Drove Majority of Site Engagement and Sales % of Exposed People Include View-Through Effects When Measuring the Campaign – Clicks Are NOT Enough
  • 76.
  • 77. Future and Other Suggestions
  • 78.
  • 79. Internet Video Advertising Spending Trends The hottest growth is in Video Ads on the Net Source: eMarketer
  • 80.
  • 81.
  • 82.