Quick, name the last two online advertisements you’ve seen.
Too hard? O.K., name the last online advertisement you clicked on. (I mean intentionally, not because it slipped under your cursor while you browsed People.com.)
Can’t think of anything? Being able to tune out ads might make your Web-browsing more enjoyable, but it’s a dilemma for online advertisers struggling to find niches in the cluttered columns of their Web pages.
Online ads are fighting for air on the forest floor of the Internet, where Flash images and written content soak up reader attention. Those rough conditions have encouraged wide experimentation, with limited results. For example, one innovation called the click-to-pay method only charges advertisers when browsers click on their icon. But click-to-pay can be expensive—as much as $2 per hit—and up to 50% of clicks are unintentional or even fraudulent.
To be fair, online advertising has some advantages. Web sites have extraordinary access to consumers, tracking clicking behavior and reader attention-span to sharpen their ad target. Google’s AdSense has been at the vanguard of these reforms. But its contextual advertisements, which use keywords to generate ad placement, can yield both accurate and absurd results. For example, a Google search for Eliot Spitzer generates sidebar ads for The New York Times (which broke the original story about the Governor’s scandal)— and “Client 9” T-shirts.
Contextual advertising makes search engines look like gold mines to ad companies, but they’re also raking in consumer ire and privacy concerns. The backlash comes from browsers who think the data-mining and keyword-spying constitute privacy violations. This has executives worrying that their strength—easy access to consumer patterns and preferences—could also be a weakness if the counterattack has teeth.
None of this means online ads are entirely doomed. The technology is improving and ad companies are learning how to target consumers better. But online ads won’t pay until they learn how to make us pay attention.
Internet ads are here to stay; thinking otherwise is just nonsense. The movement to the Web is a natural progression for advertising, which has existed for ages, an early form of it dating back to 4000 BCE on Indian rock art.
The 17th century brought advertisements to newspapers. Then, as eyeballs moved toward TV in the 20th century, the advertisers followed. And now that the Web has become a global tool—according to a 2008 IDC report on consumer behavior, almost half of total media consumption is online—and you can rest assured that advertisers are, yet again, following.
Last year, $27 billion was spent online globally, representing a mere 7% of total advertising budgets, so there’s plenty of room to grow. And because today’s ad market spans the globe—30% to 50% of U.S. Web site traffic comes from international visitors—it is less susceptible to the domestic economy.
Many say Internet ads are too pervasive and hence ignored; I believe that, just like traditional media, they’re absolutely noticed when they’re relevant, as proven by higher click-through and response rates to better-targeted ads.
Today’s ad market has networks that serve as “agents” for advertisers, helping them spend money online. As founder and chief executive officer of the Rubicon Project, a service for Web sites that optimizes ad networks to make more money from ad space, I see this trend continuing. Seven years ago there were 15 of these networks; today, more than 300.
These networks differentiate themselves through geographic focus, pricing models (cost per thousand views, clicks, actions), vertical specialties (sports, travel, and gender-specific, to name a few), and format (text, banner, video ads).
Industry analysts predict Web-ad spending will jump to $62 billion by 2012. If this is a false market, it sure has a lot of people fooled. At the very least we’ve come a long way from pictures on rocks.
Opinions and conclusions expressed in the BusinessWeek.com Debate Room do not necessarily reflect the views of BusinessWeek, BusinessWeek.com, or The McGraw-Hill Companies.If you take a peek at the stats, the click-through rates for banner ads you see on top of Web pages and the square inserts are about 0.8% on a typical site. For social networking sites, that plummets to just 0.4%. But contextual link ads can have up to a 30% click-through rate if they're supremely fine tuned and extremely relevant to a niche site where it's easy to tell what the users might want to buy.
Advertising is all about relevancy, and Web ads actually do work when done right. But I would expect less of the type of indiscriminate, plastered all across the Web advertising we see today and much heavier investment into smaller, niche sites with a more predictable audience that is more likely to care about what you're trying to sell.
The only thing that is going to make Internet advertising more effective and not seem to invade people's privacy is to appeal to their generational mind set.
This is the only way to break through the clutter in Internet advertising.
I like your article; I think it totally makes sense. I wrote an article on the future of online advertising, and it is in line with what you're saying. http://tapnet2.blogspot.com/2008/03/future-of-online-advertising.html
Very interesting, but what about mobile Web advertising? Once marketers can understand how to reach mobile Web users, they'll find lots more context.
How many of you like TV advertisements? If you do, you'll probably like internet ads as well. It is quite possible that someone will come up with technology to blank out internet ads just like Tivo does for TV.
How to make us pay attention?
There is no doubt that Internet ads are here to stay. They pay for the content. God bless 'em.
But that does not guarantee attention. The difference lies in the passivity or activity of the audience.
Advertisers have the passive audience by the eyes and ears. No problem. The active audience is another matter. During a quick reference, an Internet ad may stay on the browser--and simply be ignored.
For those wanting to maintain focus on what they are reading, flashing ads can easily be "disappeared." How?
Browser resizing and reshaping eliminates the flashing, and or barking, ads from view.
The same goes for the sound--the volume goes off. Both sight and sound attention control can be accomplished before the advertiser's identity or product enters the field of vision or hearing. "Click through" becomes meaningless.
Sorry folks. You can lead an audience to ads, but you can't make 'em pay attention.
Beyond this, the more aggressive or intrusive the ad, the more the active audience is likely to simply to leave the site altogether.
What does this do to the numbers? I have no idea.
I switch channels when annoying or obnoxious or bad behavior or feel-good dumb ads come on. Then I may or may not go back. Same with newspapers. The U.S. split in the last two elections, so why do some go
out of their way to be propaganda? Or running down 50% or more of readership.
As if they mattered.
Online ads are effective if you use the correct model (CPC, CPM, CPL, and CPA). Most of the companies don't realize the kind of ad publishing Web site they use and the ad pay model. Pay model decides your expenditure/investment and also return on your investment. Ads for low cost products like credit cards and movie tickets have to be based on CPL; otherwise, in the case of CPC, CPM ads will lead to loss.
Companies pay a lot of attention to TV/print ads, but why don't they use common sense when it comes to online ads and never think from the user prospective "Will I click on this ad?" or "Will I buy the product/services after seeing this ad?"
Many companies don't even choose to correct pages and location to ads. They advertise
health-related products in business sections of Web sites and credit card/loan, MF products in health sections of the Web site.
In short, to improve the effectiveness of the ads, companies need to place an emphasis on:
1. Ad pay model--CPC, CPM, CPA. Choose the one best suited to the product and company and for the highest ROI.
2. Choose related Web sites and Web pages to publish the advertisement.
3. Ads should have appeal or should attract people who have intentions of buying. In the case of CPA, this requires them to display brand name and product details on the ads themselves.
In the case of CPM, the company should display the name of the brand and make ads more informative and attractive.
--Pawan bhawsar
I don't see much difference between newspaper ads and Web site ads. There will be, and should be, advertising on pages that provide a service to you (such as news) that you don't pay for.
However, one glaring difference is the sensory overload that some Web ads can provide, due to the technology of the medium. But just because you can do something doesn't mean you should. I do believe the low-key (simple link) targeted ads are most effective, because they're least annoying.
Also, click-through isn't everything. Some ads are are purely for branding and name recognition, so you don't need any clicks to accomplish the goal (like the one over there on the left ;-).
Unbelievable. Bludgeoning the Web audience is about as effective as TV ads. We just tune them out. The only memorable ad we've noticed and paid attention to was one for Pemco Insurance, in Seattle. It was about Walla Walla, Wine, and Women--absolutely fabulous. The junk Madison Avenue bozos pitch is just garbage, like spam. We all ignore it.
What ads? I surf with a text browser only, so I almost never see all that junk. The few times I've used a full graphical browser it was just too irritating, so I went back to text links. The browser via Blue Floppy is also very nice.
It seems to me that we are seeing, if Google is any indication, the maturing of context based ads through search and keywords. At first we were delighted to have some relevancy, now we don't notice them anymore. How fast it goes.
If my research is any indication, the real key is customer control. Data mining techniques, browsing patterns, etc. are tools that allow advertisers to give us something that we are looking for and help us hold on to control.
Letting us choose what ads we may be interested in directly or through profiles we provide, especially if we are getting content we want in return, is much more relevant and powerful.
It's a fallacy to assume that click-through rates measure the effectiveness of an ad. If I see 40 ads for Bud Light in a week, I might not ever click the link to go the Bud Light site. Why would or should I? But when I'm at the grocery store, I may be more inclined to purchase it.
This has always been the case, but the thing is that it is measurable on the web. TV ads don't monitor if you walk away from them or mute them. We always have ignored boring ads and we always will.
Yeah, I hate those kinds of ads, too. Especially those that block your access to the web site. You know the kind I am talking about, don't you? Those very irritating ads that pop up when I first try to open Business Week's internet web site.
Clean up your own web site first!
Some ads are good, some are not. Porn ads on a kid's site-no.
In my opinion some internet ads are efficient but not all of them, as it is with other types of advertising. Personally I have a very negative reaction to the ads that are jumping under the cursor. I do not click them. In addition, I subconsciously build a negative image of the advertiser. For example, I started to look a bit negatively on FedEx after the "attacking" ad on EuroNews page, and I think that I am not unique.
On the other hand, I like Google ads. Yes, they are non-noticable, non-colorful text, and they are not jumping around, but they are always relevant. I click on them seldomly, but if I do click it is intentional. Also, since I already have some interest in the advertised product before I see it, there is larger possibility that I will buy it. All in all I would say that it depends on the advertisement type, but it is the same as on TV (where you can switch channels) or in newspapers (where you can turn the page).
The most ineffective ads, in my experience, are the ones that offer you a free dinner at Red Lobster if you complete five or six different offers. I've taken the bait once or twice only to see that the offers are for things that I don't want at prices I couldn't afford anyways. I gave up after seeing two or three offers. Who would qualify for the prize? Those suckers pay ten times what the prize is worth in offers.
Access versus excess: Opportunity and retrieval of information is good hampered by more than necessary and a lack of moderation. Two words say it all--not necessary.
Tivo for Internet ads already exists.
If you use the Firefox browser, you can install the AdBlock extension. You can filter out the ads that you never want to see again.
I agree with the other commenters in this thread. It's all about relevancy. If the message is relevant to what the user wants at that moment, they will be effective.
Frank Addante's company, the Rubicon Project, released an interesting report on online advertising today. It's on their website (rubiconproject.com). One point that caught my eye is how many different ways we're being advertised to in the guise of behavioral marketing.
I couldn't agree more with Frank and some of the other comments. Online ads aren't going anywhere. If anything, as we've seen, they will evolve over time like many other things. Format, medium, delivery and tracking all have come very far from where they were when there were 15 ad networks seven years ago. Brands and mobile devices, of course, will play a big part in this in the future.
Who sees ads anymore? Download the Firefox web browser, download the ad blocker add-on, and no more ads. Conventional advertising is dead.
Ads play an important role in keeping most internet services free. We run 6 jobsites, including www.mojolin.com, and provide job postings free of cost to employers. This service is compensated by Google AdSense. So it's a win-win situation.
"Quick, name the last two TV or outdoor banner advertisements you’ve seen."
OK, name the last TV or outdoor banner ads that you have intentionally read or watched!
Yes, ads are good. They keep a lot of Internet services free, but sometimes irritating ads like pop-ups are the very thing that stops you from visiting a Web site and could lead to loss of traffic, hence the loss of potential revenue.
I am wondering how many ads have been on all the pages I have surfed during my two hours of surfing a day. Of that number I have no clue. What I do know is that I have responded to exactly one. In February, I booked a holiday to Iceland from Cologne, Germany. While that supplier may be happy, there must be thousands who fail to get their messages to me. Maybe it's just me. But I doubt it.
I have a policy--never will I buy anything that I see in a pop-up or "floating" ad. Static ads are okay, although I rarely read or click on them.
Many user experience evangelists decry the inclusion of advertising, but on things such as a new blog or blog network and/or an unfamiliar or international consumer content site I may have stumbled upon, a healthy offering of banner advertising actually lends legitimacy. It suggests that a third party has vetted the content, feels its authentic, and chosen to participate. As a consumer, when I am seeking credible information or opinion on a topic, I discern the veracity of a site by actually evaluating who is advertising. If it's serving nothing but "house ads" and/or Google ads, it makes me question its authority, save some of those with previously established brand names. A well developed ad targeted online ad unit can be good for producer, deliverer, and consumer.
Darren said it all.
On online ads,
Regardless of the medium, ads are most effective when they are pertinent to those viewing them. Think...the Superbowl has beer ads and the people watching them often find them just as entertaining as the game.
Web advertising goes much deeper than may meet the eye; if you type in a search for any commercial good or service on Google or any other search engine, the sites that show up on the first page have all spent money to be there. Whether through pay-per-click, SEO, or placement firms.
The idea of having a link to your site/product line show up when a user is actually looking for it is brilliant.
I tend to think of the flashing ads and pop-ups as scams: "Click here for free stuff!" I see those as fishy and untrustworthy. Sure, someone will click on it (a 5 year old), but not a consumer with disposable income.
My 2 cents.
I find it especially interesting that a Flash FedEx ad appears at the top of this page. If you mouse over the ad, it expands. Once you either close the ad or stop hovering, it shrinks again. The problem is...the main navigation is no longer usable.
Oops. An example of an irritating ad.
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