There's plenty of good news for online advertising these days. Growth in advertising and electronic commerce is driving revenue results at search engines, such as Yahoo!, and content providers, such as CNN.com. CNN Interactive has tripled its advertising revenue this year and is seeing huge growth in the number of online users. Advertisers are flocking to the Internet, with total ad revenue now projected by Jupiter Communications to top $900 million this year--a threefold jump from just a year ago.
Yet there is still a tangible level of frustration out there in the media buying community. There is no universal consensus that Web advertising is really driving sales, despite lots of examples of such success. There is no universal consensus on how best to measure Web site activity, despite the Web's unique ability to monitor user traffic.
INVEST DOLLARS MORE WISELY
What's wrong? Maybe advertisers need to review their overall approach to Web spending.
Perhaps our industry is not investing the most dollars where they can do the most good.
According to Forrester Research, a mere 16% of the 50 interactive advertisers it polled will spend more than $1 million each on Web advertising in 1997. Yet, 42% will spend that much or more to develop their own Web sites.
Contrast this spending behavior with current print and TV buying models, which recommend advertisers spend about 15 times the amount on placement that they do on creative execution.
A number of Web advertisers seem to be following the path of earlier advertisers in the pioneering days of TV, when Texaco sponsored and produced "The Milton Bearle Show," as did Chevrolet with "The Dinah Shore Show."
Eventually, the Texacos and Chevrolets of the world realized TV production might not necessarily be their strength. It required an enormous investment and those dollars could be spent directly on branding and product marketing, leaving the costly business of content development to the broadcast networks, which were the only option at that time.
BANNERS OR WEB SITES
Exposure to banner advertising on the Web has been found to be responsible for 96% of ad awareness, according to a recent study by MBInteractive conducted for the Internet Advertising Bureau (AA, Sept. 29). Click-throughs to an advertiser's Web site, on the other hand, contributed to a mere 4% of ad awareness.
DELIVERING MEASURABLE AUDIENCE
What do these numbers mean? They mean that some advertisers are over-emphasizing the importance of click-through percentages and missing opportunities to build their brands on the Web.
A growing number of Web publishers are delivering a very measurable and sizable audience. Publishers are able to bring that audience together around distinguishable content, strong brand development and effective marketing.
The paramount question is where to invest advertising dollars--ad banners on popular content sites or advertiser-created Web sites? Should advertisers spend their resources creating information and entertainment content that is not directly linked to their marketing objectives? Or should they piggyback on big content providers, which are successfully delivering big online audiences?
Advertisers and content providers need to work together better in order to take advantage of these cyberspace opportunities, which can increase brand awareness and product identification with consumers in this growing media segment.
They can start by taking another look at Web banners and working to fine-tune their advertising messages. Many advertisers, like their TV brethren did years ago, need to wean themselves away from content--which may not be their core strength anyway--and focus on product marketing and branding, which they are uniquely positioned to execute.
SELL CARS, HOMES, STOCK
Together, advertisers and content providers can help achieve a product's strategic marketing objectives. We can sell a car, bring potential home buyers to new listings, help investors buy a stock or mutual fund or assist travelers with booking a reservation. Whether that's accomplished through using ad banners to deliver a branding message or to drive consumers to an advertiser's Web site, successful content providers will get your name in front of an ever-increasing number of targeted interactive users. What you do with that connection is up to you and your marketing team.
Mr. Glassberg is senior VP-general manager of Turner Interactive Marketing & Sales and a director of the Internet Advertising Bureau.
Copyright October 1997, Crain Communications Inc.