Transcript What were and are the main concerns for advertisers - blue

NYU Stern
Firms & Markets
Michael Ahern
Santiago Andujar
Nathan Blouin
Rebekah Gilbert
Min-Jee Hwang
Ana Sviatschi
Spring 2011
America Online brings Americans online, and ISP Battles
America Online
• AOL founded in 1989 to bring the internet to America.
• 1998 acquisition of CompuServe, while competing ad-supported NetZero
and Juno free email ISP services
• 2000 Merger with TimeWarner
• Major advertising deals from 1996 – 2003 were sponsorship based
• Search advertising became part of brand strategy with 2007 acquisition of
ADTECH AG
Microsoft adapts to the Search Market
MSN to Bing
• 1995 MSN Released, then LiveSearch, then Bing
• Last of Big Three to develop its own ad server network
• Developed MSN adCenter, similar to AdWords auction winning PPC revenue stream
• Currently holds 4% market share in revenue, 30% share in search
Yahoo!
Yahoo!
• Started in 1995 as a search directory
• GoTo.com, Overture, Yahoo! Search
• Maintains extensive 2-petabyte (2-mllion gigabyte) databases on user
activity,more info than IRS has on all US taxpayers in all of its records.
• Strength in profiles!
Types of Advertising Online
(Morgan Stanley Dean Whitter)
1997
1998
1999
2000
2001
2002
2003
Banner
80%
52%
50%
46%
42%
41%
40%
Sponsor
15%
40%
39%
39%
34%
32%
30%
Interstitial 5%
3%
4%
5%
6%
7%
8%
Email
0%
1%
3%
6%
10%
13%
15%
Other
0%
4%
4%
4%
8%
7%
7%
Google Conquers the World
Google
• 1996 Average home internet speed is 28 kbs
• 1996 NetGravity 1st major local ad server for Yahoo! and TimeWarner's Pathfinder
• 1996 Doubleclick founded with innovative global ad serving targeted search
• 1998 Oingo created changed its name to Applied Semantics in 2001,which was later
acquired by Google in April 2003 for US$102 million and became AdSense, Google's
main ad serving platform
• In 2000, Google began selling advertisements associated with search keywords. The
ads were text-based to maintain an uncluttered page design and to maximize page
loading speed. Keywords were sold based on a combination of price bid and clickthroughs, with bidding starting at $.05 per click.
How has the industry changed throughout the years?
HUGE
growth
How has the industry changed throughout the years?
What is Internet Advertising?
• Types of ads
• Types of sites that show ads
Definition
• company A has some sort of content to draw audience
• company A sells (in other words, supplies) this audience to company B so
that B can advertise their products
How has the industry changed throughout the years?
Supply has increased
Demand has increased
How has the industry changed throughout the years?
Points, Badges and Quests
Big Data
Big Data has been around for a long time between
credit card transactions, phone call records and
financial markets. Companies like AT&T, Visa, Bank of
America, Ebay, Google, Amazon and more have
massive databases they mine for competitive
advantage. But lately, Big Data is finding its way to the
smallest startups. The Web and cloud computing
brings Big Data everywhere. But what exactly is
pushing Big Data forward?
Socialnomics
Inverting the paradigm
Impact of online advertising on Retailers budgets and business
Industry shifts ADV budget to internet advertising
TV distribution
Internet
26.0
News papers
22.8
TV: cable networks
17.6
Radio
15.3
Directories
11.5
Consumer Magazines
Out of Home
• Reduces industries’ overall advertising
budget since is more cheaper and cost
effective than TV or paper reading
22.5
TV: broadcast networks
Trade Magazines
• Ability to put ads in front of audiences
actively looking for information
28.6
10.2
7.4
Retail
6.1
4%
4%
Telecom
21%
5%
• Most of the largest U.S. retail chains are
using YouTube
4% 4%
4%
6%
7%
7%
Auto
20%
Computing products
Others
6%
Leisure and Travel
7%
•Community building project thorugh
internet For ex: Coke Zone, Burger King
Financial Services
16%
Consumer Packaged Goods
Pharma & Helathcare
10%
8%
13%
11%
12%
Media
Entertainment
8%
12%
11%
What were and are the main concerns for advertisers in this industry?
Effectiveness / ROI
•
Do more ads and clicks necessarily translate into higher sales/profits?
What were and are the main concerns for advertisers in this industry?
E-Business Regulations: Restrictions & Bans
• Adblock, Noscript, CAN-SPAM Act
Constantly Evolving Market
•
Developing New Strategies Based on New Technologies and Trends
What were and are the main concerns for advertisers in this industry?
Consumers Do Not Want to View Ads
•
•
•
Negative Association With Ads
Internet Privacy & Data Security Concerns; Consumer Distrust
Over saturation - Too much advertising
What were and are the main concerns for advertisers in this industry?
Ethics
•
Manipulating Adwords methods to falsely up the
advertising revenue
•
Content Farms – spamming
search results