2. Marketing process
Target your market
Position your product
Communicate to your target audience
Communication
Advertising
Personal selling
3. 2 main goals of marketing
communication
Brand advertising – aim is to build awareness
of a product by putting the brand name and
product benefits in front of users
Develop positive attitudes prior to purchase
Direct-response advertising – seeks to
motivate action – BUY!
4. Online communications media types
Medium Advantages Disadvantages
Website /
personalized
website
Communicate rich, detailed information that users
can navigate at will; can track users and customize
site accordingly
Narrow reach
Banner ads Link directly to buying opportunity; easy to
measure effectiveness; wide reach; potential for
effective targeting
Low attention and click-through
rates; short life; limited ‘pass-along’
audience; very high clutter; fleeting
exposure
Interstitials Catch user’s attention; link to buying opportunity Can annoy users; limited ‘pass-
along’; audience
Rich media Attention getting; link to buying opportunity Can annoy users without
broadband access
Dynamic ad
placement
Serves up customized ads to users in real time Difficult to execute well; can annoy
users and/or other advertisers
Search engines Good credibility; high believability; guarantee of
position available; significant audience at major
sites
High competition; information
overload; limited ‘pass-along’
Classified and
listings
Relatively inexpensive; potential for wide
exposure; qualified audience
Clutter
Opt-in email High demographic selectivity; high credibility;
significant flexibility; proven high click-through
rates; absolutely inexpensive; some pass-along
Requires substantial user base
before effective; high clutter
Mass email High reach; inexpensive; flexible Low attention and significant
resentment (spam image)
5. Marketing communications we will
look at over the next few weeks
This week: online advertising (banners,
interstitials and rich media)
Week after study break: search engine
marketing
Following week: email and viral marketing
6. What difference does the Internet make
to advertising?
Traditional form of one-way, one-to-many mass
advertising no longer necessary or appropriate
Web provides a highly targeted, receptive audience
Web advertising can be interactive, and therefore by
definition, more engaging
Web provides a mechanism for instant action
Immediate gratification of the consumer not available with
print, TV or radio advertising
Consumers complain more about web advertising
than about other forms of advertising
7. Internet advertising
Advertising is non-personal communication of
information through various media
Usually persuasive in nature about products
Usually paid for by an identified sponsor
Paid space on a website or in an email is considered
internet advertising
The process of selling advertising on the Internet is
very similar to offline media – web companies create
content then sell advertising space to advertisers
But also include the situation where a content
provider will pay to include that content on another
firm’s site (sponsored content = advertising)
8. The importance of Internet advertising
Began in 1994 with banners on Hotwired.com
Saw strong growth until 2000-2001 (on a par with the
drop in advertising spending in all media)
Now on the upswing again, as dissatisfaction with
traditional media grows (see link to reading)
The importance of the Internet as an advertising
medium varies across industries. Most advertising
comes from following categories
consumer related advertising (30%)
computing (18%)
financial services (12%)
media (12%)
business services (9%)
9. How successful is web advertising?
Banner ad click-through rates are very low
around 1% of users actually click on a banner ad
of that 1%, around 5% actually follow through with a transaction
The web is very good at person-to-person interactive
services, and at promoting product loyalty
Growth has been in interactive ads using “rich media”
Said to be twice as effective as traditional banners
Big payoff is in the capability to track ad effectiveness
and ability to respond to change very quickly
10. Web site advertising formats
Began as static banners in the mid 1990s, added
animation, then moved to the use of “rich media”
Interactive formats, including:
Banners
Buttons
Skyscrapers
Pop-ups, pop-unders, interstitials
Floater ads and Shoshkele (United Virtualities)
Rich media gallery (Macromedia)
For examples of all kinds of web advertising, go to
www.eyeblaster.com Eyeblaster
11. Aggregate number of user clicks on a banner ad
Ad Clicks
Number of times a banner ad is downloaded to a user’s browser and
presumably looked at
Ad Views
(Impressions)
Percentage of ad views that are clicked upon; also “Ad Click Rate”
Click-Through
Formula used to calculate what an advertiser will pay to an Internet publisher
based on number of click-throughs a banner generates
CPC
(Cost-per-Click)
Cost per thousand impressions of a banner ad; a publisher that charges
$10,000 per banner and guarantees 500,000 impressions has a CPM of $20
($10,000 divided by 500)
CPM
Paying for, and measuring usage
Online media have varied payment schemes – unlike traditional media which is
usually priced on a pay for placement basis (based on ratings)
Going beyond click-through rates:
Clickstream data gives you the whole picture of a consumers movements
before, during and after viewing an advert
12. Complexities of online advertising
Designing interactive rich media is challenging
Non-linear – consumer can take many paths
Getting the right balance between intrusive and engaging
Tracking effectiveness
Online ads delivered to individuals rather than to mass
markets – makes placement and tracking much more
complex
Technical complexity of rich media adverts mean closer ties
between the advertiser and the media seller
Ad placement
Disagregated medium means ads must be placed with
several Internet publishers to reach audiences
13. Helping marketers deal with these
complexities
Workflow software to help in the buying, selling, and
managing of managing of online ads – eg. Solbright
Macromedia and DoubleClick’s joint product to help
manage both the creation and measurement of ad
effectiveness
DART Motif
14. Advertising to wireless devices
Huge growth potential
PDAs, cellphones, laptops etc now widely used
Big question is – would mobile users rather pay for
content, or will they tolerate advertisements in
exchange for free content
Answer is not clear because of several factors
low bandwidth
small screen size
different techniques needed to track ad
effectiveness
by-the-minute payment for air-time by user
15. Viewing advertising in exchange for
viewing content
A growing trend as content providers try to
make sense of business realities
www.ivillage.com - view ad before gaining
access to site
www.salon.com - view ad in exchange for
getting access to complete magazine
article
16. The future of web advertising
Web technology allows for many interesting
multimedia advertising formats
These catch attention when they first appear,
but quickly become intrusive and annoying
Big backlash against pop-ups
Marketing fundamentals will prevail:
Success is about reaching the right
audience with the right message at the
right time