Chapter 16 Media Planning: Advertising and IBP on the Internet

2009 South-Western, a part of Cengage Learning

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No Wires Means New Rules

New technology will change Internet advertising opportunities:
WiFi became popular in 2004 because it provided wireless Internet access connections reaching out about 300 feet.

WiMax is similar to WiFi in that both create wireless hot spots but iMax has a range of 25-30 miles!
Mobile-Fi is similar to WiMax but adds the capability of accessing the Net while the user is moving in a car or a train. Ultrabroadband is a technology that will allow people to move extremely large files quickly over short distances. Technology now provides the option for podcasting and cell advertisingbut will consumers accept the intrusion?
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Role of the Internet in the Advertising and IBP Process

Internet will not replace traditional media Advertisers have discovered ways to use the Internet as a key component of integrated brand promotions Auction sites provide small businesses with new opportunities Web 2.0 offers a whole new way of communicating
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The (R)evolution of the Internet

Connected consumer experience community, empowerment, liberation Connected consumer desire to control their information flow In 1994 advertisers began venturing on the Internet, retreated in 2000 and returned in 2004 At present:
1 billion users Ad revenues of $36 billion by 2011
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An Overview of Cyberspace
The Internet is a global collection of computer networks linking both public and private computer systems.
It was originally designed by the U.S. military to be a decentralized, highly redundant, and thus reliable communications system in the event of a national emergency. Internet connection has risen from 2 million in 1994 to 1.4 billion in 2008. But, only about 16 percent of the world is now connected.
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Internet Media
Electronic mail (e-mail)
Opt-in e-mail Spam (phishing) = 120 billion messages daily

Usenet: Collection of discussion groups

World Wide Web (WWW)

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Surfing the WWW

Web is a vast library Surfing: gliding from one site to another
Search engine: finds all sites related to key words entered by user in search
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Portal
A Portal is a starting point for Web access and search and channeling surfers to particular sites
Portals can be generalserving cross sectional interests of surfers, Yahoo! Portals can be verticalserving specialized markets, Jobster Portals can be horizontalproviding links across many industries, Verticalnet Portals also can be ethnic or community based, Latina Online
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Web Sites and Blogs

A Web site is a collection of Web pages, images, videos and other digital content A mash up is the combination of one or more Web sites in to a single site A personal Web site can be created by individuals to highlight interests/lifestyle

A blog is a personal journal that is frequently updated, intended for public access, can be personal or professional

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Advertising on the Internet

Internet Advertising Expenditures
1995 = $54.7 million 2004 = about $10 billion 2008 = estimated at $20 billion Still only 6-8 percent of all media spending

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Advantages of Advertising on the Internet

Target Market Selectivity Tracking Deliverability and Flexibility Interactivity
click-through

Cost Integration
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Types of Advertising on the Internet

Paid search Search engine optimization (SEO) Display/Banner ads Rich media/video and audio Corporate home pages Virtual malls Widgets Virtual Worlds Second Life

Sponsorship
Pop up/Pop-under E-mail communication

Permission marketing Viral marketing

Video games
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Issues in Establishing a Web Site

Costs can be high
$1 million to develop $4.9 million to launch $1 million to maintain

Make the site sticky through rational branding Purchase keywords and a domain name Promoting the site to attract visitors
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Making the Site Sticky

Incorporate engaging, interactive features
Weather, late breaking news, stock reports Online games or videos

Practice rational branding

Give visitors unique informational resources that justify visiting the site

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Security and Privacy Issues

Corporate security
Web users can often download text, images, and graphics from the Web No fully foolproof, viable policing of this practice is possible yet

Consumer Privacy
Consumers are worried companies will use personal information Cookies: coded identifier downloaded to site visitors computer WiFi and WiMax compound the security issue
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Coalition for Advertising Supported Information & Entertainment (CASIE)

Consumers should be educated about electronic marketing. Marketers should clearly identify themselves in electronic communications.

Marketers should respect the privacy of personal information.

Consumers should be informed if personal information will be shared with others. Consumers ought to have the ability to obtain a summary of what personal information about them is on record with a marketer (new 2008). 16
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Measuring Internet Advertising Effectiveness

Term Hits Page views Visits Unique visitors Definition
Number of elements requested from a page Number of pages sent to the requesting site Occasions user x interacted with site y after z time has elapsed Number of different people visiting a site Allows for tracking of web site usage Tracking behavior of a sample of Internet families and projecting behavior to larger populations 17

Web Analytic Software

New Methods

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Measuring Internet Advertising Effectiveness

Term
Impressions Pay-per-click Click throughs Click fraud

Definition
Number of times a page is viewed Payment rate for impressions Clicking on ad to web site False generation of site clicks to generate payment per click

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Managing the Brand in an E-Community

Consumers have new ways of communicating with each other
Users form online communities Dealing with brand communities is a challenge and a huge opportunity in a Web 2.0 world

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Future of Advertising and IBP on the Internet

Introduction of new technologies such as wireless communication and streaming videoBroadcast Web
Mergers and partnerships (Microsoft and Yahoo!?) Merging traditional and new media with wireless communication technology Developing a new advertising revenue model
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