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The ABCs of Advertising Online


Last updated 8/5/2010

Online advertising revenues will reach about $9 billion dollars this year, with expenditures expected to grow at a rate of 29% annually. One contributing factor to this growth is the rising popularity of high-speed Internet access. Half of American households now have broadband Internet connections and approximately 14% of their media exposure time is spent online.

The Internet offers advertisers unique opportunities to target their messages more effectively, to communicate on a more personal level to prospective customers and to measure responses with greater accuracy.

Following are some tips to help plan an effective online strategy:


1. Know Your Target. Identify your target audience, then develop a campaign strategy that will reap the best return on investment by efficiently reaching that audience. Sounds easy, right? The problem is that the online medium often converges with other media. For example, over half of the people online have the TV on at the same time. And 15-50% of people who purchase a product from a direct response television commercial or infomercial make the purchase online rather than by using a toll-free number.

Broadband connections even allow advertisers to deliver television commercials to consumers online. People tend to go back and forth between the two media, which expands your advertising horizons. Advertisers need to develop strategies that integrate television advertising with Internet advertising. Some of the more sophisticated advertisers use a technology called behavior targeting, which allows them to see which sites a visitor came from and which ads they clicked on. This anonymous information allows advertisers to customize their message to users, depending on what types of ads they click on.

2. Consider Your Options. There are many types of online advertising and marketing services. Each of these options offers advertisers unique advantages for reaching their target audience: pop-up or pop-under ads, banner ads, rich media ads (which include flash ads), interstitials (a page inserted in the normal flow of content between a user and the site) and superstitials (a page that loads behind an active web site, meaning the user doesn't see the ad until it's totally downloaded and ready to run), streaming video, skyscraper ads, rollover ads that expand as your mouse runs across them, e-mail sponsorship ads, newsletter and e-zine ad sponsorships, advertorial placements, search engine optimization and affiliate programs where one web site promotes another web site's products in exchange for a commission, where transactions are tracked through unique codes.

There is a huge demand for Internet advertising on the major net portals, such as CNN, Yahoo and MSN. This demand has actually caused a shortage of time slots. As a result, companies who are interested in running their ads or commercials online should consider doing so on their own web sites. Recent technology enables anyone who comes to your site to view your commercial regardless of what type of browser they have. When a potential customer visits your site, the commercial automatically starts playing.

An experienced online ad agency can help you decide what Internet options make sense for your company.

3. Incorporate Online Advertising into Your Budget. Any company can advertise on the Internet. If you currently advertise on television, radio or in print and you'd like to move onto the Internet, you may want to start by allocating 5-12% of your ad budget for online advertising. Not all online advertising is inexpensive, although some big brand advertisers pay $300,000 a day to appear on a popular web site (the equivalent cost of a 30-second prime time network television spot).

4. Track Results. Online advertisers like the precise, measurable results they get from the Internet. Results are typically measured using some kind of tracking system—cost per click, per impression, per acquisition or per sale. This information allows advertisers to see the effectiveness of their ads in more concrete terms than with television or print.