Transcript Integrated Marketing Communications 8e.

INTEGRATED MARKETING
COMMUNICATIONS
IN ADVERTISING AND PROMOTION
CHAPTER 13
Internet Advertising
© 2010 South-Western, a part of Cengage Learning
All rights reserved.
PowerPoint Presentation by Charlie Cook
The University of West Alabama
Eighth Edition
Chapter Objectives
After reading this chapter you should be able to:
1. Appreciate the magnitude, nature, and potential for
Internet advertising.
2. Be familiar with the two key features of Internet
advertising: individualization and interactivity.
3. Understand how Internet advertising differs from
advertising in conventional mass-oriented advertising
media, as well as how the same fundamentals apply
to both general categories of ad media.
4. Understand the various forms of Internet advertising:
display ads, rich media, e-mail advertising, Web logs,
search engine advertising, and advertising via
behavioral targeting.
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–2
Chapter Objectives (cont’d)
After reading this chapter you should be able to:
5. Appreciate the importance of measuring Internet
advertising effectiveness and the various metrics
used for this purpose.
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–3
The Internet As an Advertising Medium
• The Internet’s Evolving IMC Roles
 Building demand
 Conducting transactions
 Filling orders
 Providing customer service
 Serving as an advertising medium
• Issues and Concerns
 Increasing flow of advertising revenue to the Internet
 Consumer control of information received
 Versatility and effectiveness of Internet
communications in targeting and reaching customers
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–4
The Two i’s of the Internet:
Individualization and Interactivity
• Individualization
 Recognizes that the Internet user has control over the
flow of information
• Interactivity:
 The capabilities that the Internet gives users to select
the information that they perceive as relevant
 The capabilities that the Internet gives brand
managers to build relationships with customers via
two-way communication
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–5
The Internet Compared
with Other Ad Media
• Interactivity as a Disadvantage
 Internet users are highly involved and goal driven
(“leaning forward”) when connecting to the Internet,
making them more apt to actively avoid unsolicited
advertisements as clutter.
 Traditional media users are more casually involved
(”leaning back”), making them more receptive to
advertisements embedded in the media.
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–6
Table 13.1
Internet Advertising Formats
• Web Sites
• Display or Banner Ads
• E-mail
• Opt-in Versus Spam
• Rich Media Formats
• E-zines
• Pop-Ups
• Wireless E-mail Advertising
• Interstitials
• Mobile Phone Advertising
• Superstitials
• Video Ads
• Blogs, Podcasts, and Social
Networks
• Search Engine Advertising
• Keyword-Matching Advertising
• Content-Targeted Advertising
• Advertising via Behavioral Targeting
• Blogs
• Podcasts
• Social Networks
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–7
Web Sites
• Uses for Web Sites
 As an advertisement for the company
 As a venue for generating and transacting exchanges
between organizations and their customers
 As a link to other integrated marcom communications
• Well-Designed Web Sites
 Are easy to navigate
 Provide useful information
 Are visually attractive
 Offer entertainment value
 Are perceived as trustworthy
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–8
Display or Banner Ads
• Click-through Rates (CTRs)
 Rates are less than 0.3%—exposure is not equivalent
to attention
 B2B rates are higher than B2C rates
 CTRs are a function of brand familiarity:

Known-brand CTRs decrease with multiple exposures while
unknown-brand CTRs increase with multiple exposures
• Banner Ad Benefits
 Top-of–mind (TOMA) awareness for established
brands increases brand equity
 Increased probability of purchasing behavior by
consumers
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–9
Table 13.2
Types and Sizes of Internet Marketing Units (IMUs)
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–10
Rich Media on the Internet
Rich Media
Advertising Formats
Pop-Ups
Interstitials
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
Superstitials
Video Ads and
Webisodes
13–11
Blogs, Podcasts, and Social Networks
• Blogs
 Are written by individuals to exchange their views on
issues (e.g., products and brands ) with others in
online forums
 Are citizen journalism—online word-of-mouth
 Are an interactive medium that businesses can use to
connect with customers and appear more credible.
• Podcasts
 Are self-produced radio-style online programs to
which consumers can subscribe
 Enable advertisers to target consumers who have
self-selected programs of interest to them
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–12
Blogs, Podcasts, and Social Networks
• Social Networks
 Allow users to interact with “friends,” share opinions
and information, and create online communities
 Developed by businesses enable consumers to learn
from one another and to share their experiences


P&G’s “The People’s Choice”
Mattel’s Barbiegirls.com
 Are presently unproven marcom tool
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–13
E-mail Advertising
• E-mail as a Effective Marcom Tool
 + Delivering advertising messages
 + Providing sales incentives to mass audiences or
targeted groups
 – Sending junk mail (spamming) and phishing
• Opt-In E-mailing
 Is the process of marketers asking for permission to
send messages to consumers
 Avoids the flow of irrelevant inbound messages
 Allows marketers to provide targeted information that
is of interest to the receiver
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–14
E-mail Advertising (cont’d)
• E-mail magazines (E-zines)
 Are free magazine-like publications that deliver
specialized content and credible advertising
messages to targeted audiences
• Wireless E-mail Advertising (WiFi)
 Allows users to connect to the Internet through WiFi
hotspots
 Offers significant marcom potential in its ability to
message consumers with pertinent offers from stores
close to their location.
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–15
The Special Case of Mobile Phones
• Cellular Phones as the Third Screen
 Mobility and universal coverage



WiFi technology for Internet Access
Short Messaging System (SMS) for text messaging
Multimedia Messaging Service for graphics and sounds
 Music, game, video, and ringtone downloads
• Marcom Issues
 Invasion of privacy—negative consumer responses to
unsolicited messages
 Limited advertising space on cell screens
 Gaining consumer acceptance of opt-in advertising
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–16
Search Engine Advertising (SEA)
• Search Engine Advertising (SEA)
 Is fastest growing form of Internet advertising—about
40% of online advertising spending
 Includes a variety of well-known services (e.g.;
Google, MSN Search, and Yahoo!) that people use
when seeking information
 Attempts to place messages in front of people when
their natural search efforts indicate they are interested
in buying a particular good or service
 Makes use of paid keywords to increase the odds that
a firm’s product or service will be included in the
search results and appear as a sponsored link
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–17
Figure 13.1
The Role of Keywords in Increasing the Odds
That Ready Consumers Encounter Your Ad
Step 1: Prospective purchasers of a specific good or service perform natural
search using one or more search engines to locate that item.
Step 2: Matches to Internet shopper’s search are generated by Google or
another search engine.
Step 3: Alongside the matches are sponsored links that correspond to the
keyword(s) entered by the shopper.
Step 4: These sponsored links appear because companies offering the
searched item purchased corresponding keywords from the search
engine company.
Step 5: Shoppers may click through to a sponsored Web site and purchase
a desired item or, at least, consider this Web site for future
purchases.
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–18
Purchasing Keywords and Selecting
Content-Oriented Web Sites
• Keyword Matching Advertising
 Advertisers bid for keywords by indicating how much
they are willing to pay each time an Internet shopper
clicks (cost per click, CPC) on a sponsored link to
reach their website as a result of a search.
• Content-Targeted Advertising (AdSense)
 A Google program that enables advertisers to run ads
on sites with content related to their products or
services
 Google acts as an ad agency placing ads and
receiving a commission
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–19
Purchasing Keywords and Selecting
Content-Oriented Web Sites (cont’d)
• Click Fraud
 Occurs when a competitor or other party clicks on a
sponsored link repeatedly in order to harm the other
advertiser.
 Occurs when employees of content-oriented websites
click on links to advertised Web sites to increase
revenue.
 Fraud estimates range from 5% to 20%
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–20
Advertising via Behavioral Targeting
• Behavioral Targeting
 Involves directing online
advertisements only to
consumers showing an
interest in a particular
product or service by their
site-selection behaviors.
 Involves the use of “cookies”
that record the activities of
visitors to web sites—
regarded by some users as
an invasion of their privacy
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–21
Brand Name Fundamentals
Distinguishable
from competitors
Compatible with
desired image
Memorable and
pronounceable
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
Facilitates
consumer
learning
Suitable for
global use
13–22
Measuring Internet Ad Effectiveness
How many people clicked
through a particular Web ad?
What are the demographic
characteristics of these people?
Questions
to Ask
How many visited
a particular Web site?
What actions were taken following
click throughs or site visits?
Is this form of online advertising
yielding a suitable return on investment?
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–23
Metrics for Measuring Internet Ad Performance
• Exposure value or popularity of
Web site or Internet ad
 Number of users exposed to
an ad
 Number of unique visitors
 Click-through rate
• Usefulness of Web site
 Proportion of repeat visitors
• Ability to target users
 Profile of Web-site visitors
 Visitors’ previous Web-site
search behavior
• Ability of site to attract and hold
users’ attention and the quality
of customer relationships
 Average time per visit
 Number of visits by unique
visitors
 Average interval between user
visits
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–24
Metrics for Measuring Internet Ad
Performance
• Click-through Rate (CTR)
 The percentage of people who are exposed to an
Internet-delivered ad and actually clicked on it
• Cost per Thousand Impressions (CPM)
 Assesses how much (on a per-thousand-impressions
basis) it costs to place an online ad
 Measures when an ad comes on to the eyeballs of
the user (opportunity-to-see, OTS) but provides no
real information about the actual effect of the
advertisement
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–25
Metrics for Measuring Internet Ad
Performance (cont’d)
• Cost per Action (CPA)
 The number of users who actually click on a display
or rich-media ad to visit a brand’s Web site, register
their names on the brand’s web site, and purchase
the advertised brand
© 2010 South-Western, a part of Cengage Learning. All rights reserved.
13–26