Online Ads Continue to Out-Perform Traditional Advertising Medias
by Ron Burgess
The marketing media is still buzzing over major companies pulling ad money from TV and shifting it to higher yielding Internet advertising. While large industries have carefully studied the effectiveness of various advertising medias and have structured their plan according to this information, most small businesses don't have a media plan at all, let alone a way to measure the effectiveness of newspaper vs. radio vs. Internet advertising.
The most probable reason why major advertisers are so infatuated with online advertising may be the declining TV audience and newspaper subscription rate. Or, it might be that it is easier to measure effectiveness in the general corporate trend by measuring everything possible!
Either way, it is undeniable that Google rules in the realm of search advertising. This advertising is placed directly on a page based on the key words chosen by the advertiser and which are associated with the page's content. The idea is that someone who searches on "gifts" will see websites and ads about gifts. Ads are best targeted by a highly refined search.
A frenzy is occurring online in this big-stakes game for all of the large advertising players, including Microsoft's MSN.com network, who has a major study underway to examine the return on their investment of certain kinds and combinations of online advertising. MSN's AdCenter hopes to compete with Google and Yahoo in the placing of key-worded advertising.
"The ROI is very good because the keyword prices are so low," said Danielle Leitch, Executive Vice President of More Visibility.[1] "Some advertisers are the only ones using specific key words. The DM News reports that one advertiser's campaign generated $22,000 in sales in the one week after Thanksgiving with just a $400 investment," according to iCrossing's Noah Elkin.
The ways in which Microsoft is imbedding behavioral and demographic targeting features will differentiate with Google's geographic strength.
"Some advertisers will really leverage the new targeting criteria, and others are going to completely drown in it," says Josh Stylman, managing partner of Reprise Media, New York. However, smaller advertisers have a more understandable online option in display advertising on local and industry specific websites, with ample traffic.
Just like buying ad space in magazines or newspapers, display ads (or button and banner ads) are purchased for a monthly price on pages that you select. Budgets can be easily controlled, and performance is more easily measured than most medias - if the ad space is properly setup by your webmaster or the media company. One advantage of advertising online is the branding ability of the media. Branding is accomplished as many people may view the page, even if they do not click on the ad. If the number of times a logo is viewed is the goal (just as in newspapers and magazines), then the online-per-view cost is a fraction of the cost of newspaper advertising.
For instance, a regional business print publication costs over $40 per thousand views for a small 1/8 page ad. This assumes that every subscriber looks at every page - which is rather doubtful. A regional or city directory website might be as low as $10 per view, and can be coordinated with the actual copy on the page to target the ad. Therefore, the effectiveness multiple is more than just four-to-one, and may even be eight-to-one or more!
The costs of advertising online will probably not continue to be as low as they are today. Many key words and ad spaces are already becoming more expensive as advertisers change their emphasis from traditional media to online resources. But, at the present time, the Internet is an advertisers' market, with low prices producing increasing usage and visibility.
[1] DM NEWS December 26, 2006
The marketing media is still buzzing over major companies pulling ad money from TV and shifting it to higher yielding Internet advertising. While large industries have carefully studied the effectiveness of various advertising medias and have structured their plan according to this information, most small businesses don't have a media plan at all, let alone a way to measure the effectiveness of newspaper vs. radio vs. Internet advertising.
The most probable reason why major advertisers are so infatuated with online advertising may be the declining TV audience and newspaper subscription rate. Or, it might be that it is easier to measure effectiveness in the general corporate trend by measuring everything possible!
Either way, it is undeniable that Google rules in the realm of search advertising. This advertising is placed directly on a page based on the key words chosen by the advertiser and which are associated with the page's content. The idea is that someone who searches on "gifts" will see websites and ads about gifts. Ads are best targeted by a highly refined search.
A frenzy is occurring online in this big-stakes game for all of the large advertising players, including Microsoft's MSN.com network, who has a major study underway to examine the return on their investment of certain kinds and combinations of online advertising. MSN's AdCenter hopes to compete with Google and Yahoo in the placing of key-worded advertising.
"The ROI is very good because the keyword prices are so low," said Danielle Leitch, Executive Vice President of More Visibility.[1] "Some advertisers are the only ones using specific key words. The DM News reports that one advertiser's campaign generated $22,000 in sales in the one week after Thanksgiving with just a $400 investment," according to iCrossing's Noah Elkin.
The ways in which Microsoft is imbedding behavioral and demographic targeting features will differentiate with Google's geographic strength.
"Some advertisers will really leverage the new targeting criteria, and others are going to completely drown in it," says Josh Stylman, managing partner of Reprise Media, New York. However, smaller advertisers have a more understandable online option in display advertising on local and industry specific websites, with ample traffic.
Just like buying ad space in magazines or newspapers, display ads (or button and banner ads) are purchased for a monthly price on pages that you select. Budgets can be easily controlled, and performance is more easily measured than most medias - if the ad space is properly setup by your webmaster or the media company. One advantage of advertising online is the branding ability of the media. Branding is accomplished as many people may view the page, even if they do not click on the ad. If the number of times a logo is viewed is the goal (just as in newspapers and magazines), then the online-per-view cost is a fraction of the cost of newspaper advertising.
For instance, a regional business print publication costs over $40 per thousand views for a small 1/8 page ad. This assumes that every subscriber looks at every page - which is rather doubtful. A regional or city directory website might be as low as $10 per view, and can be coordinated with the actual copy on the page to target the ad. Therefore, the effectiveness multiple is more than just four-to-one, and may even be eight-to-one or more!
The costs of advertising online will probably not continue to be as low as they are today. Many key words and ad spaces are already becoming more expensive as advertisers change their emphasis from traditional media to online resources. But, at the present time, the Internet is an advertisers' market, with low prices producing increasing usage and visibility.
[1] DM NEWS December 26, 2006
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