No One Sees Your Online Ad....

I came across a very interesting article on the state and effectiveness of online advertising, specifically that almost half of all online advertisements are not read.

The article is titled "Worse Than You Thought: Nearly Half of Online Ads Aren't Viewed" though ironically this is actually better than I thought.

Apparently, comScore said that 31% of ads weren't seen last year and now this new calculation has the percent at 46%.  Can we trust these metrics?  I'm surprised it isn't 95%.  ComScore counts an online ad as viewable if at least 50% of pixels are in view for at least half a second for a site visitor. Of course, this is a joke, it should probably be 100% of the ad for at least 2 seconds. Can a flash of half of the pixels really have an impact on the mind?  I doubt that.

Some of this has to do w/the calculations, but at lower tier sites, the % is lower.  It is unclear if this includes search advertising, but from my reading of the article, it seems to only include website advertising, not search.

For me, the only online advertisements I've ever clicked on are the ones that move under my cursor just before I'm about to click somewhere else (those sneaky devils). 

I'd pay for an advertisement free Internet, would you?

Shoppergirl26 - who are you really?

A recent article published by MarketingMagazine.co.uk revelead that 37% of Internet users are not willing to provide personal data online and 31% will not provide real information about themselves to brands online.
As we have discussed in class, much of online advertising today is heavily influenced by the information users share online. Thus, ads are segmented and targeted at specific users. The results of this study are sure to reshape the way advertisers build their online marketing strategieis.
For example, some studies have shown that on average there are more women online than men. Perhaps we could conclude that women are less trusting than men? If this is the case, advertisers should seek to create incentives for women and online users in general to provide their REAL personal information.

Hulu Advertising - Breakthrough?

Due to a newfound obsession with reruns of Modern Family and Glee, I have become acquainted with the fascinating 0nline media platform that is Hulu. As a reminder to most of you, birthed in 2007 as a joint venture between News Corp and NBC, Hulu is an attempt at a competitor for Youtube. Although they experienced initial trouble raising advertising revenue in 2008 and 2009, the site has become a dominant advertising platform.

How did Hulu go from noteworthy struggles in 2008-9 (http://www.businessweek.com/technology/content/mar2009/tc20090330_571175.htm) to kicking the proverbial advertising a*$ today?

What did they do?

From a quick perusing around their site for specifics on their advertising, it is clear that they decided at some point to invest a lot of effort into innovation and for adding value for them and for advertisers themselves.

Hulu created much smaller increments of videos during the shows on the site that are accompanied by Like / Dislike boxes that both attract viewer attention as well as supply a new and valuable metric for advertisers. When crossed with the sign-up information of the user, these likes/dislikes are valuable demo/behavioral info.

Hulu also created free content that can help advertisers use their services: there are case studies on the site.

The last thing that exemplifies the sleak style and technology of Hulu is their gallery and ranking system for this past year's Superbowl Commercials: http://www.hulu.com/adzone2011#50120562

Check it out

Hulu’s New Player: Ad Targeting

Hulu (hulu.com) is a joint venture of Fox, ABC and NBC, initially devised as an alternative to piracy. It offers free streaming video of TV content from the 3 broadcasters, and other studios. The revenue model is supported by advertisements, usually short and few (with a sleek countdown clock, which makes the experience less annoying) Not surprisingly, viewers recall the ads they see on Hulu much better than they remember TV ones.

This week Hulu’s blog (http://blog.hulu.com/2010/05/13/pardon-our-dust/) unveiled the new player improvements, consisting of a number of technical features (such as adaptive bitrate streaming or volume normalization), a slight restyling (mainly consisting on a larger screen) and “ad tailor”, a new system for better targeted advertisement. As discussed in class, this is the ultimate objective of any online advertiser.

Hulu refers to this phenomenon in terms of relevance: every time we watch an ad we’ll be asked “was this ad relevant to you? Answer yes or no with one click, and we'll use the data to try to serve your ads about the products and services most relevant to you.” Occasionally, people will be able to choose which ad to watch, so it will be even more likely to be relevant to their interests.

Hulu represents both a success and a threat for its parent companies: audience has been drawn from both illegal P2P sites, but from broadcast TV as well. In my view, Hulu will charge for premium content in a near future. As an illustrative example, RTL (a German broadcaster), allows viewers to catch up free for recent shows but charges them for older episodes, as well as to view the latest one a couple of days before it’s aired on TV.

The Future of the Newspaper

It's old news that the newspaper industry is struggling. With the decline in sales of hard-copies of newspapers, many news organizations are looking at ways to make money through their online newspapers. While many are experimenting with various campaigns, there does seem to be some encouraging news for the companies and their potential advertisers: if targeted effectively, the demographic of online newspaper readers has the potential to be a very lucrative one.

In comparison to the overall internet audience, newspaper web site readers are 27% more likely to be earning $100,000 or more a year, and they are more likely to have a post-graduate degree. They tend to be more web-savvy, and they use the web much more frequently for downloading media. Readers of online newspapers also shop online, often spending money on big-ticket items like automobiles, and they are twice as likely to have gone on multiple round-trip flights within the past month. Couple this with the fact that the total number of readers of online newspapers is growing at an impressive rate, and newspaper companies have reason to be optimistic about their future.

Check out some of the stats here: http://www.naa.org/PressCenter/SearchPressReleases/2008/NEWSPAPER-WEB-SITES-ATTRACT-RECORD-AUDIENCES-IN-FIRST-QUARTER.aspx

Lost Ad Revenue

I kept CNN playing in the background while I was working on class project today. As I listened intermittently, I heard the segment about Susan Boyle’s defeat yesterday on the British television show, "Britain's Got Talent".  Her fans seemed to be disappointed, but others should be for a different reason.

Several weeks ago, the American media hype about the unlikely contestant’s performance on the show generated over 20 million views online. The video clips of Susan Boyle’s performance has made her a worldwide internet sensation. Her performance on  "Britain's Got Talent" was one of the most viewed videos on You Tube ever, but the producers of the show have not been able to capitalize on the success of the of the internet viewership worldwide. The primary reason is the producers of the show did not roll out online video strategy and the second reason is the video uploads to You Tube were done illegally, so no advertising revenue streams were generated. The video host as well as the content provider missed out on a significant advertising revenue stream. 

So why do many  video content providers  fail to execute on a strategy to generate online revenue streams as video advertising has become one of the fastest growing advertising mediums? One reason may be the producers are concerned with the cannibalization of TV advertizing dollars as more TV viewer convert to online viewers. One solution could be to broadcast original programming on TV and in syndication upload online. Another approach may be to upload original programming online to target a secondary geographic market.  Moreover, established content producers view online broadcasting as  experimental and do not quite understand what works effectively. Besides, one could argue that there are no established revenue models for online video.

As for Susan she still has a chance capitalize on this phenomenon and perhaps land projects such as a book deal, recording contract or a movie about her life.

Chrysler's ace-in-the-hole: How to estimate car sales with a 99% accuracy

With an impending bankruptcy and a shrinking ad budget, how can Chrysler focus their sales strategy?

The answer turns out to be some like the Google Analytics dashboard Prof. Kagan demo'ed on Tuesday--but this one's on steroids.

The Wall Street Journals article, "Modeling Tools Stretch Ad Dollars" (http://online.wsj.com/article/SB124259801821028103.html) from May 18, 2009 gives us more insight:

A team of statisticians, economists, software engineers and media planners at Chrysler's digital marketing agency, Organic, has designed a "media modeling" system that helps the company calculate the best ways to allocate its marketing dollars. The system calculates how much ad spending is needed to meet certain sales targets and then analyzes how both online and offline ads affect Web activity and, ultimately, sales.

The differentiator is that Chrysler can micro-tweak even its offline ads based on online response data. Imagine being able to increase frequency of a hit commercial and can a dud within minutes.

Ad agencies long have used complex models to calculate the best ad spending mix, but the rise of digital media has revolutionized these systems. Instead of waiting weeks or months for data, marketers now can get them in real time, allowing them to adjust their ad spending or the creative elements of their campaigns on the fly.

There may be a silver lining to the economic crisis after all--innovative marketing techniques bred by tough times.

-Greg Bateman

The "Big Five" of Online Shopping

This article was adapted from Frank Fiore's book, TechTV's Starting an Online Business. Frank is a regular contributor to InformIT.


Customers expect your online business to offer the right combination of selection, price, service, convenience, and security. You don't? That's okay - you probably have plenty of competitors who are just a click away. Your customers can shop there instead. To paraphrase former U.S. President Bill Clinton, "It's the customer, stupid."

Shoppers don't care about your site, your business, or your life. What they care about is themselves. When they come to your site, they want to see if there's anything there that interests them. They want to know, "What's in it for me?" They come to your web store with a certain set of expectations. Your job as a web merchant is to meet those expectations.

Your customers expect to find what they came for: a fair price, a good selection of products, great service, and a secure and safe place to shop. In other words, they're looking for the Big Five of online shopping. And if they're from "out of town"—that is, another country—they're also looking for a site that speaks their language!
Everything on your site should be about the customer and designed from the customer's point of view. Your customer not only needs a reason to buy, but a way to buy easily and safely.

Customers want to know right away if their visit to your site is going to save them time and money, and if their shopping experience will be pleasant. Can they find what they want easily? Can they place an order in a variety of ways? Can they find your customer service pages, shipping and handling fees, and return policies without spending a large amount of time digging through your site?

These are the customer's expectations, and you have to meet them if you want your online business to be a success. Want to give live customer support to shoppers on your site? Don't want to spend the money for programming? Then use MSN, Yahoo! Messenger, or AOL Instant Messenger services. Shoppers can download the free desktop application and communicate with you in real-time if they have a question. If your site is designed with the Big Five of online shopping in mind, you'll provide your customers a pleasant shopping experience and a reason to buy from your online store again.

http://www.informit.com/articles/article.aspx?p=24037

the mini-cooper isn't getting any bigger.

In the WSJ today, a brief article about how the advertising "pie" online isn't getting any bigger, and that any business seeking to be supported by web advertising would do well to keep that in mind. Writes Martin Peers,

"The Internet-ad business is a little like a Mini Cooper. There is a limit to the number of people who can squeeze inside... Yet newspapers, magazines and TV outlets are each vying with Web-only concerns for a piece of the action... Oversupply of inventory could be particularly brutal for pricing."

Peers cites a statistics showing that from 2006 to 2008, ad spending on traditional media "dropped 4.8%, or $6.7 billion, to 1.32.2 billion," while ad spending on the internet rose by $6.6 billion, nearly the same amount. Suffering the greatest erosion in ad revenue: traditional media like newspapers. David Carr writes in the New York Times that the paper lost $74.5 million in the first quarter of 2009 in advertising revenue - and this includes an 8% decline in internet ad revenue.

As a journalist, I am well aware that my industry is in the midst of a full-scale panic right now about this loss of revenue, and how migrating to an internet-based ad revenue model will irrevocably alter the business model of journalism and how newsrooms fund their work. The oft-repeated phrase is that moving traditional media online is the equivalent of trading "analog dollars for digital pennies." Newspapers are attempting different advertising models that mostly involve different points of insertions of advertising in their content - between a link and an article, for example, as Forbes and Salon.com do.

The New York Times recently introduced a prominent two-banner display on its homepage, just below the masthead and above any of its breaking news stories. For the most part, this main banner ad is thankfully not of the flashing, tacky variety - but the presence of a single Apple logo dominating a quarter of the horizontal space and propping up both sides of the lead story is, at least to me, a little disconcerting. I'm under no illusions that the news isn't a business, but the prominence of advertising surrounding the content, like a moat -- look, it troubles me.

And yet, as Carr writes, even though this new huge homepage banner is enormous, the Apple banner ad doesn't even come close to replacing the Tiffany ad that traditionally runs in page three of the physical newspaper every day (It's had that spot for a hundred years!). The banner ad brings in far less money, and, as Carr writes,

"Until our digital model finds a way to create a similar kind of exalted placement, it will be tough to charge the kind of prices for advertising that reflect the cost of producing quality content."

It is also all the more apparent now that newspapers - accustomed to being the role of displaying the marketing output of their advertisers - must find a way to also market themselves online - to establish a presence in online communities and networks and through email marketing with their subscribers and readers - methods of communicating with media consumers that, for the most part, newspapers are simply not used to doing... and it has been taking publishers a long time to wrap their heads around the notion that news is now an ongoing multiple-front conversation, not a wire distribution service.

In other news, emarketer reports that banner advertising gets a bum rap for being annoying and ineffective, even though it seems that click-through rates are down - while 31% of respondents in a survey reported clicking on ads, ad viewers responded in other ways: by going to the advertising company's website directly, by seraching for information about the company, or even by looking around for information about the company through social networks or message boards. It seems banner ads may end up with the desired end - ad viewers become aware of the company and may even go on their own to find out about the company - but they're bypassing that click.

The economic recession and what this means to online advertising

With the recent economic downturn, many advertisers have begun paying greater attention to optimizing advertising budgets and more closely analyzing campaign ROIs. Not only have we seen this impacting traditional offline media outlets, such as magazines and newspapers, but it has had an even greater impact on internet companies whose revenues rely solely on the sale of banner advertisements.

As some internet companies are coming to grips with lower advertising demand, they are beginning to accept less favorable contracts from online advertisers. For many, this means the transition from CPM-based advertising to cost-per-action (CPA) rates. Because CPA campaigns only pay advertisers when an action is completed, much more risk is assumed by the internet company and also makes them reliant on the quality of the advertisement and advertised product. For those that haven’t switched to CPA campaigns, many have begun accepting much lower CPM rates.

For a much smaller group of internet properties, the recession has not affected the ability to demand extremely high CPM rates. Recently, it was reported that Cannon is paying as much as $275 CPM to video advertise its products in Thrillist, an email newsletter that is distributed to 1 million subscribers. Certainly the highly targeted demographics of Thrillist subscribers allows the company to charge a premium for its advertisements, but many still question whether the premium paid will generate enough sales to make it worthwhile.

In the coming months, as the economy begins to rebound, it will be interesting to observe whether companies will return to higher CPM rates or if online advertising rates will remain less favorable.

New York Times to Launch Local Blog?

TechCrunch reported this morning that the New York Times may unveil a local neighborhood blog project this upcoming Monday. The Brooklyn neighborhoods of Fort Greene and Clinton Hill will be one of two pilot neighborhoods. Users of NYTimes.com will be invited to report neighborhood matters including "...cultural events, bar and restaurant openings, real estate, arts, fashion, health, social concerns and anything else that goes on in the ‘SoHo of Brooklyn.’"

This new initiative can be likened to CNN's iReporters site, which also encourages the public post news stories. How this changes the nature of news reporting still waits to be seen, but it appears that both initiatives will attract more eyeballs, and in turn, more advertisers to their sites. Still, whether or not this can be a sustainable revenue model is anyone's guess. Will small, local advertisers finally be able to advertise on the coveted pages of the New York Times - space traditionally reserved for big name brands? Will the operational costs of running the local sites be recouped? How will the New York Times define "all the news that's fit to print?" Will the paper's brand and image take a hit? Again, the answers can only be guessed at this point.

E-Mail Newsletters the Way to Go?

More and more web sites will be pushing newsletters into your inboxes in 2009. There is no contest when it comes to the economics of advertising revenues collected via e-newsletters versus CPM for display ads. For example, take the case of Dogster, which extensively uses newsletters:

- Use of Google AdSense can yield a CPM of 28¢

- Use of Glam Media, one of the highest-paying ad networks, would deliver a floor CPM of $2.
But that was still leaving a good amount of revenue on the table, especially considering an ad network takes half the gross.

- In addition to letting Federated Media sell some inventory, Dogster built its own Web sales force, setting CPMs at $8 to $20.

- But even that pales compared to what he charges advertisers per 1,000 views of an ad on his e-mail newsletter: a whopping $20 to $40

A few months ago, Comcast offered $125 million for DailyCandy based on newseltter advertising potential. Last month, Yelp! landed its first national ad campaign for its "Weekly Yelp!" newsletter. At first glance it may seem counter-intuitive that advertisers are willing to spend more money on advertising via low-tech e-mail newsletters. But as this BusinessWeek article points out:

"But remember that signing up for and opening an e-mail newsletter is a much bigger commitment than passively clicking on a link that takes you to a blog post. Publishers can see how many people open an e-mail, how long they read it, and how many friends they forward it to. Advertisers eat up that kind of engagement, because it's different, tangible, and more likely to result in an action such as making a purchase."

See BusinessWeek.com article for more: http://www.businessweek.com/technology/content/feb2009/tc20090224_035701_page_2.htm

Online Advertising Market to Shrink in 2009

The Wall Street Journal reported on Wednesday that the online advertising market is forecasted to drop 5% in the first quarter of 2009 (by research group IDC), the market's first contraction since the dot-com bubble burst in 2001. This is a far cry from what research was suggesting only months ago - that the market would continue to grow despite the worsening economy. The Washington Post ran an article by Sarah Levy (http://www.washingtonpost.com/wp-dyn/content/article/2009/02/25/AR2009022503245.html) that suggested two assumptions were at the root of the perpetually bullish views on online advertising:

"One was that online advertising is more actionable and more measurable than advertising in the offline world. The other was this pie chart that Yahoo’s PR department used to love to trot out showing the discrepancy between the amount of time people spend online and the percentage of advertising spend that goes online. ‘At some point, that has to balance out, right? RIGHT?’"

Measuring online advertising is turning out to be more convoluted than originally thought and metrics are still hardly reliable (http://www.businessweek.com/technology/content/jan2009/tc20090127_410266.htm). Sarah Levy continues to suggest there is a dearth of innovation in this space, when it's clear that innovation is what's going to grow the market. She says:

"Google-aside, I think the Web industry has gotten lazy when it comes to advertising innovation. There's too much outsourcing to the ad networks and too much of an assumption by the portals and other large properties that gaudy eyeballs will be enough. That's old media thinking."

Apparently many e-marketers are spooked by IDC's data. Hopefully this will push marketers away from old media thinking and lead to more innovation that the market requires to flourish.

"Why the Click is the Wrong Metric for Online Ads"

AdAge published an article today discussing the shortcomings of measuring online advertising via clicks. Clearly a better attribution model is needed as web sites are increasingly not being given due credit for directing consumers to retailers. Sites ranging from brand-focused sites such as NYTimes.com to social media sites like Facebook are losing credit because these sites are not necessarily the last place consumers see and act upon an ad. If sites don't get the proper credit deserved, then advertisers take their dollars elsewhere.

Esco Strong, market research manager at the Atlas Institute comments:

“Virtually any seller that's not a search engine or affiliate network is not getting the proper credit for their ads. There's a disconnect in terms of the actual work that's delivering people through that sales funnel and the sale and there's a disconnect in how advertisers are measuring their ads and planning their campaigns.”

Randy Rothenber, CEO of the Internet Advertising Bureau suggests the onus is on the web sites to offer analytics and optimization solutions on better targeting consumers. Luckily, companies like Microsoft hope to develop products offering an alternative to "last-ad accounting." That's good news considering research released by Microsoft today found that "...in the final two days before a sale or conversion, consumers see an average of five and a half ads. In the 90 days leading up to a sale consumers see 18 ads for a product."

see http://adage.com/digital/article?article_id=134787 for AdAge article

Uniqlo Parka Style 1000

Uniqlo is a Japanese casual wear designer, manufacturer, and retailer. It is one the the few profitable retailer in 2008. It success resulted from delivering high quality apparels with affordable prices, artistic design, innovative communication and friendly retail environment. Colorful yet simple style makes Uniqlo the top choice of not only designers and celebrities but the ordinary people, like me. Uniqlo is also well known for its marketing and communication. Always very playful and experimental in a pleasing way. Recently, it launches Uniqlo Parka Style 1000. Click it and you will feel boosted with happiness and optimism through the opening commercial. You can't wait to look at the Parka selection and see how everybody showcase his or her own style by browsing the website. You are wondering those mix-and match styles look nice and maybe I could be one of the 1000 styles. Again, take a look by yourself.   

Onitsuka Tiger's Zodiac Race Campaign

Onitsuka Tiger is a premium sneaker brand based in Japan and currently held by ASICS. To celebrate its 60th Anniversary, it introduces the Spring/Summer collection and launches a global '' Cycle of Life'' campaign in Feb. The idea is coming from the ancient legend that the God has to decide the order of Zodiac calendar. 13 animals compete for 12 places. The agency Amsterdam Worldwide creates a campaign that works across multiple communications channels, include a one meter-long sneaker diorama; a three-minute animation film; a 30-sec trailer, a website, and print materials. 

The website has all the contents described. You can see how they made the sneaker diorama and those animal characters. The sneaker is a detailed model interpretation of Japan. Everything is hand-made on that diorama. Then they turn the diorama into the film setting. All the animal characters are 3-D animated. They show their personalities along the race. The story is simple and the production is great. I admitted I watched the film again and again. It has so many details that I personally enjoy so much. 

You can also calculate your zodiac sign on the website and it will show which animal is in charge your year of birth, how your personalty is affected, and of course, some merchandises with the symbol of your year. The website is worth browsing because of the production quality. Go, take a look, and figure out which animal year you're in. However, it is not 100% perfect. Some features is coming soon and you can't download anything fun or share with friends. But it's good enough for marketers to know the potential of integrating channels and communications. 

Leveraging Old Media with New

Often we focus more on how digital is supplanting traditional media and less on how a nicely integrated campaign can leverage the best (or worst) of each. One area of TV advertising that has to-date remained more or less sacrosanct is the good old Super Bowl spot. While no longer breaking price records year-over-year, in an era of fading revenue the spots seem to be holding their own. But these costs create a new demand: in this austere media environment, how to maximize and measure the productivity of these budget-busting ads?

This short article (non-subscribers) in the Wall Street Journal discusses a number of innovative means of creating stickiness and/or measurability being tested by several of this year's advertisers. New (to me) is a product in the Canadian market that allows consumers to use their digital cable remote to watch a longer version of an ad or bookmark that longer version for later viewing; the revenue model is decidedly new media: cost-per-click. A simpler tactic among several being used by Castrol is the purchase of keywords related to their ad to assure primacy in post-ad search. Doritos is likely going to take the prize for a second year with their viral ad contest:

“…offering $1million to anyone who can create a Super Bowl commercial for its Doritos tortilla chips that scores No. 1 in USA Today’s …ad competition.”

And, finally, what marketing opportunity would be complete without yet another brand attempting to create an online community, (this one is about Pedigree dog food under guise of pet adoption) which lets you download a barking dog ringtone for your iPhone....

My bets? Simplicity wins. Harnessing true consumer passion for your product wins. Forced community, maybe not so much.

'' Alive'' advertisement

Just want to share an online advertisement done by ING Direct Belgium that shows a smart use of digital media. Here is the entertainment.

I shouldn't reveal too much before you actually see it. Hope you'll feel amused. We could discuss whether it's effective or what you think of it. 

Online Advertising = Pork Bellies

Paidcontent has interesting commentary by internet ad execs on a "comment made at the Interactive Advertising Bureau's annual conference by Martha Living Stewart Omnimedia's Wenda Harris Millard (pictured, above, left) warning that media companies were selling web inventory like "pork bellies."

This brings up three interesting points related to ad networks:

1. As ad networks and exchanges increase in size and usage, we can expect increased trading and liquidity of product, and we can expect to see at least some of this inventory trade and act like commodities

2. I like the idea of investing and trading in ad's and prophesize hedge funds buying up super bowl and christmas ad inventory ahead of time to flip it for a profit

3. I am intrigued by the idea of internet ad inventory value creation through exchange activity, i.e., going around to different networks and exchanges, buying certain types of inventory, packaging it all together, and selling it for a premium

Yahoo fine-tunes ad system

On the day that Yahoo announced another rejection to Microsoft's acquisition bid, the company also revealed details on its new ad selling system, called AMP, which aims to simplify the process of selling online ads.

AMP sounds a lot like Google's AdSense - the details about selling ads concentrate around the options to place ads onto Yahoo's publishing partner sites. The first partners to start using the system, slated for launch this fall, are Yahoo's newspaper partners, hundreds of independent daily and weekly newspapers.

Furthermore, AMP would have behavioral targeting capabilities built-in, allowing advertisers to target users based on demographic characteristics, geographic location, and online behavior. This comes as no surprise since Yahoo has been way more willing than Google to offer behavioral targeting to its advertisers.

Source: NYTimes