1 © 2009 South-Western, a part of Cengage Learning Chapter 16 Media Planning: Advertising and IBP on the Internet PPT 16-1

2 PPT 16-2 No Wires Means New Rules New technology will change Internet advertising opportunities:  WiFi became popular in 2004 because it provided wireless Internet access connections reaching out about 300 feet.  WiMax is similar to WiFi in that both create wireless “hot spots” but iMax has a range of miles!  Mobile-Fi is similar to WiMax but adds the capability of accessing the Net while the user is moving in a car or a train.  Ultrabroadband is a technology that will allow people to move extremely large files quickly over short distances.  Technology now provides the option for podcasting and cell advertising—but will consumers accept the intrusion?

3 PPT 16-3 Role of the Internet in the Advertising and IBP Process  Internet will not replace traditional media  Advertisers have discovered ways to use the Internet as a key component of integrated brand promotions  Auction sites provide small businesses with new opportunities  Web 2.0 offers a whole new way of communicating

4 PPT 16-4 The (R)evolution of the Internet  Connected consumer experience community, empowerment, liberation  Connected consumer desire to control their information flow  In 1994 advertisers began venturing on the Internet, retreated in 2000 and returned in 2004  At present: –1 billion users –Ad revenues of $36 billion by 2011

5 PPT 16-5 An Overview of Cyberspace  The Internet is a global collection of computer networks linking both public and private computer systems.  It was originally designed by the U.S. military to be a decentralized, highly redundant, and thus reliable communications system in the event of a national emergency.  Internet connection has risen from 2 million in 1994 to 1.4 billion in  But, only about 16 percent of the world is now connected.

6 PPT 16-6 Internet Media  Electronic mail ( ) –Opt-in –Spam (phishing) = 120 billion messages daily  Usenet: Collection of discussion groups  World Wide Web (WWW)

7 “Surfing” the WWW  Web is a vast library  Surfing: gliding from one site to another  Search engine: finds all sites related to key words entered by user in search PPT 16-7

8 PPT 16-8 Portal  A Portal is a starting point for Web access and search and channeling surfers to particular sites  Portals can be general—serving cross sectional interests of surfers, Yahoo!  Portals can be vertical—serving specialized markets, Jobster  Portals can be horizontal—providing links across many industries, Verticalnet  Portals also can be ethnic or community based, Latina Online

9 Web Sites and Blogs  A Web site is a collection of Web pages, images, videos and other digital content  A “mash up” is the combination of one or more Web sites in to a single site  A personal Web site can be created by individuals to highlight interests/lifestyle  A blog is a personal journal that is frequently updated, intended for public access, can be personal or professional PPT 16-9

10 PPT Advertising on the Internet Internet Advertising Expenditures  1995 = $54.7 million  2004 = about $10 billion  2008 = estimated at $20 billion  Still only 6-8 percent of all media spending

11 PPT Advantages of Advertising on the Internet  Target Market Selectivity  Tracking  Deliverability and Flexibility  Interactivity –click-through  Cost  Integration

12 PPT Types of Advertising on the Internet  Paid search –Search engine optimization (SEO)  Display/Banner ads  Sponsorship  Pop up/Pop-under  communication –Permission marketing –Viral marketing  Rich media/video and audio  Corporate home pages  Virtual malls  Widgets  Virtual Worlds – Second Life  Video games

13 PPT Issues in Establishing a Web Site  Costs can be high –$1 million to develop –$4.9 million to launch –$1 million to maintain  Make the site “sticky” through “rational branding”  Purchase keywords and a domain name  Promoting the site to attract visitors

14 PPT Making the Site “Sticky”  Incorporate engaging, interactive features –Weather, late breaking news, stock reports –Online games or videos  Practice rational branding –Give visitors unique informational resources that justify visiting the site

15 PPT Security and Privacy Issues  Corporate security –Web users can often download text, images, and graphics from the Web –No fully foolproof, viable policing of this practice is possible yet  Consumer Privacy –Consumers are worried companies will use personal information –Cookies: coded identifier downloaded to site visitor’s computer –WiFi and WiMax compound the security issue

16 Coalition for Advertising Supported Information & Entertainment (CASIE)  Consumers should be educated about electronic marketing.  Marketers should clearly identify themselves in electronic communications.  Marketers should respect the privacy of personal information.  Consumers should be informed if personal information will be shared with others.  Consumers ought to have the ability to obtain a summary of what personal information about them is on record with a marketer (new 2008). PPT 16-16

17 PPT Measuring Internet Advertising Effectiveness TermDefinition Hits Number of elements requested from a page Page views Number of pages sent to the requesting site Visits Occasions user “x” interacted with site “y” after “z” time has elapsed Unique visitors Number of different people visiting a site Web Analytic Software Allows for tracking of web site usage New Methods Tracking behavior of a sample of “Internet families” and projecting behavior to larger populations

18 PPT Measuring Internet Advertising Effectiveness TermDefinition Impressions Number of times a page is viewed Pay-per-click Payment rate for impressions Click throughs Clicking on ad to web site Click fraud False generation of site clicks to generate payment per click

19 PPT Managing the Brand in an E-Community  Consumers have new ways of communicating with each other  Users form online communities  Dealing with brand communities is a challenge and a huge opportunity in a Web 2.0 world

20  Introduction of new technologies such as wireless communication and streaming video—Broadcast Web  Mergers and partnerships (Microsoft and Yahoo!?)  Merging traditional and new media with wireless communication technology  Developing a new advertising revenue model PPT Future of Advertising and IBP on the Internet