EFFECTIVENESS OF INTERNET ADVERTISING
Introduction:
Effectiveness of Internet Advertising
Web advertising first appeared in 1994. Eleven years later, in 2005, U.S. companies spent $12.5 billion advertising online. No longer is that the irrational money of venture-backed start-ups with dubious business models; according to Nielsen/NetRatings, 25% of all display ads in 2005 promoted Fortune 500 companies. Advertisers already spent double the amount online that they spent in 2005 on billboards and other outdoor advertising and roughly half of what they spent respectively on magazine and radio advertising. And after brief market contraction in 2001 and 2002, the online ad industry has been growing 30+% from then.
Yet, despite this rapid mainstream of online advertising, many advertisers still are not observing a range of established tactics and strategies understood to substantially improve the effectiveness of online ad campaigns. In some cases, this is because advertisers are new enough to the internet to remain behind on the learning curve.
In other cases, many advertisers have viewed the Internet as a source of “cheap” advertising and therefore do not invest sufficiently in experimentation and research to identify for themselves the tactics that work best.”Sometimes advertisers are pennywise and pound the foolish in not running brand effectiveness studies and using the click-through rate to measure the success of a brand campaign,” said Yaakov Kimelfeld, director of business intelligence and Beyond Interactive. Brian Eakin, Associate Media Director at Freestyle Interactive, concurs: “While many clients will say that there is value in learning, the clients most in need of actionable research and most connected to a cost-per-sale measure of success, and many of them simply would not allocate the investment that does not mean immediately contribute to product sales. The challenge of planners is to extract the strategic insight from active campaigns without forcing their
Effectiveness of Internet Advertising
Web advertising first appeared in 1994. Eleven years later, in 2005, U.S. companies spent $12.5 billion advertising online. No longer is that the irrational money of venture-backed start-ups with dubious business models; according to Nielsen/NetRatings, 25% of all display ads in 2005 promoted Fortune 500 companies. Advertisers already spent double the amount online that they spent in 2005 on billboards and other outdoor advertising and roughly half of what they spent respectively on magazine and radio advertising. And after brief market contraction in 2001 and 2002, the online ad industry has been growing 30+% from then.
Yet, despite this rapid mainstream of online advertising, many advertisers still are not observing a range of established tactics and strategies understood to substantially improve the effectiveness of online ad campaigns. In some cases, this is because advertisers are new enough to the internet to remain behind on the learning curve.
In other cases, many advertisers have viewed the Internet as a source of “cheap” advertising and therefore do not invest sufficiently in experimentation and research to identify for themselves the tactics that work best.”Sometimes advertisers are pennywise and pound the foolish in not running brand effectiveness studies and using the click-through rate to measure the success of a brand campaign,” said Yaakov Kimelfeld, director of business intelligence and Beyond Interactive. Brian Eakin, Associate Media Director at Freestyle Interactive, concurs: “While many clients will say that there is value in learning, the clients most in need of actionable research and most connected to a cost-per-sale measure of success, and many of them simply would not allocate the investment that does not mean immediately contribute to product sales. The challenge of planners is to extract the strategic insight from active campaigns without forcing their