With click rates at 0.49%, according to Nielsen/NetRatings May data, advertisers need new ways to reach increasingly tuned-out consumers.
In February, the Interactive Advertising Bureau recommended guidelines for seven new online advertising units, including vertical "skyscrapers" and larger, more interactive formats that support interactive media such as Macromedia Flash.
These new formats have been quickly embraced by sites such as CNet (in fact, some agencies call them "CNet ads"), and advertisers such as Oracle Corp. An Oracle spokeswoman says the CNet "Messaging Plus Units" achieved a 25% to 30% higher response than typical banner ads. Since the first of the year, content sites have not only embraced new ad sizes, they have extended the reach of pages with "pop-up" advertisements. Pop-ups create new browser windows of various sizes, often as a user leaves a page. Time.com pioneered the use of pop-ups to push magazine subscriptions, and sites such as CBS.Sportsline quickly embraced them for other advertisers.
The best-known pop-up format is the superstitial, first delivered two years ago by Unicast, New York. It can now be delivered and measured by all third-party ad servers. Superstitials have proven their branding impact for clients such as Jack Daniels, says Annette Mullin, Unicast' director of special projects.
"[Jack Daniels] had people interact with their ads for an hour after clicking them," she says, and the results show up in pre- and post-ad studies. Sites using the format now reach more than half of the online market, she says. While banners of all sizes run alongside content like a print ad, superstitials play on top of content, offering the potential impact of a TV commercial, says Allie Shaw, VP-worldwide marketing for Unicast. "That's what advertisers are willing to pay the most for-it gives them the most flexibility. When you embed ads in pages, you're dependent on editorial."
Another leading rich media software company, Enliven, last week introduced a new suite of interactive advertising tools: Enliven for Macromedia Flash, Enliven for GIF and Enliven for Macromedia Director.
The new ad units, which offer media planning and reporting capabilities in addition to creative development, support the IAB formats such as skyscrapers, sponsor boxes and rectangles.
Other formats like Zebus and Viewpoint extend the trend in new ways. In May, Forbes.com became the first site to support Zebus' format, which plays 15 seconds of full-motion video from inside a vertical ad banner, says Tricia Beninghof, VP-marketing and business development of Zebus Group, New York.
Zebus streams its own ads itself and says sites need only add a few lines of code to support the format. Zebus' server detects the speed of a user's connection, and narrowband users can download a utility that lets them pre-cache the video, says Ms. Beninghof.
Viewpoint Corp., New York, based its new ad format on a full-motion demonstration technology used by clients such as Sharper Image and Eddie Bauer on their own Web sites, says CEO Bob Rice. Viewpoint ads emerge from banners as full-screen experiences that include demonstrations and commerce, says Rice, but leave the user on the same page where they started.
"A lot of people don't click on ads because they don't want to be taken away. They want to get information here, where they are," he says. "The new formats support that."
The new streaming formats provide a TV-like experience for advertisers including Kraft Foods, Olympus, Coca-Cola Co. and Ford Motor Co., all of which have bought streaming ads in the last six months through RealNetworks, Seattle, Wash.
These play on its RealPlayer plug-in. Shelley Morrison, VP-media and distribution sales with RealNetworks, says RealPlayer ads have been accepted because "the kinds of units we sell look and smell a lot more like radio and TV."
Their impact can also be measured in the same way. Besides changing the user experience, many of today's Web ads also support transactions.
jury is still out
Companies such as Bluestreak of Newport, Rhode Island pioneered the delivery of content and commerce within banners two years ago, says Eric Picard, the company's director of product management. "We've had clickthroughs in the double digits and conversion rates of 80%," he says. As an enabling technology, Bluestreak can support Viewpoint and other rich media formats, so an ad "can carry any data transaction directly in the ad space without [the user] leaving the Web site."
"If you look a few months or years down the road, most online ads will incorporate rich media," Mr. Picard predicts, although the term "rich media advertising" will disappear. But just because the medium is rich doesn't mean advertisers can plug a broadcast campaign onto the Web, Mr. Picard adds. "You can certainly take a video ad and use our video technology to run it online, with the same metrics. But it really wastes a lot of the online opportunity."
But some market analysts say the jury is still out on whether the new formats work at all. Senior analyst Jim Nail of Forrester Research says the new formats are being pushed by publishers, not advertisers, who desperately want to boost the money they get for each page impression. Supporting the formats can be a technical challenge, he says. "They have to revise templates so you have a hole big enough for them. It's hard to do, yet it's basic. It's a nightmare."
Having third parties such as Zebus serve the new ads is also a problem, Mr. Nail adds. "Sites might prefer to serve them themselves, but then you have to plug into new technology in order to support them."
Whatever the technical hurdles, however, the new formats are here to stay, says Duncan Southgate, an account group director at Millward Brown IntelliQuest, the Austin, Texas-based market research firm. "Bigger is a greater opportunity," he says, and streaming is even better. "We see them being six to seven times more impactful" than banner ads, and offering "greater branding opportunities."
"We have gauged consumer reaction to streaming ads, and people accept that the intrusion is acceptable because they're getting something for free," he adds.