Newsletter #117 Do Banner Advertisements Work?

Created on 27/09/07

A special hello to all new subscribers. This article is on the Web at this address.

Our last newsletter (28th August, 2007) was "Web Video - The New Frontier".

Feature Article

Traditional mainstream (pre-Web) advertising, with the exception of direct mail, works on the same principle. If enough people are viewing, reading or in the vicinity a proportion of them will notice the advertising and act on it, thereby providing a return to the advertiser. Of course the advertising can be targeted based on who is assumed to be consuming the content, but the advertising is mainly broadcast rather than being closely targeted.

Now think about the Web experience. For the most part it’s pretty similar, the high traffic sites show banner advertisements at the top or down the side of the page (often both) that are loosely targeted. The problem is that clickthrough rates (percentage of viewers who click on an ad) are extremely low. Social networking sites such as MySpace and Facebook are all the rage on the Internet this year, but the clickthrough rate on MySpace is apparently only 0.10% with Facebook even worse at 0.04%. That’s right only 4 clicks per 10,000 views!

The interesting thing is that contextual advertising is working on the Web – that is, advertising that relates to a search you have done. Do a search on Google and you will see contextual advertising on the right hand side and sometimes at the top of your search results.

When you think about it, it makes sense. Contextual advertising works because it is relevant information inserted almost seamlessly into a consumers’ attention stream when they’re actually searching for stuff. On a news site, consumers are looking for information, on a social site people are looking to make connections with other people. They’re not searching for stuff and they’re not really interested in the advertising. In fact it is normally a fluke if a site’s advertising is relevant to a viewer. This lack of targeting is a self-perpetuating cycle. Because people rarely see advertisements that apply to them, they unconsciously screen them out.

The other key point in defence of banner advertising is that some advertising is branding, that is, it is not expected to generate a click action. Also Net advertising suffers from being able to be measured, whereas traditional advertising can’t easily. Who knows what the action rate for a particular advertisement in a mainstream newspaper was?

There are plenty of alternative advertising and marketing ideas being used successfully on the Web:

• Widgets are small interfaces that perform a single task or allow you to customise an application. An example is a widget showing you the latest weather conditions in your city. You can create and brand a widget that is useful to consumers or customers and keep your brand to the forefront.
• Viral marketing where you produce something so valuable or entertaining that people forward it on.
• Email newsletters.
• Contextual advertising like Google AdWords
• Search engine optimisation
• Video pop-out advertising.

If you are going to be moving some of your advertising budget to the Web, and we think you should be, we suggest you don’t rush to create banner advertisements on various sites.

There may be better ways to spend your money online.

Hot Tips

Newbies

Tabbed browsing has been available in FireFox and Opera for many years. However most of you will be using Internet Explorer and the latest version IE7 has finally added tabbed browsing. What it means is that instead of opening a new window which normally takes up the whole screen you can move between different pages on different sites by clicking on tabs within the one window. In IE7 (and Firefox) you can open a new tab by going "Ctrl"+"T" or right clicking on any link and select "Open in a new tab". Try it, it's the only way to browse the Web!

Power Users

If you're a power user you won't be using Internet Explorer, you'll be using Firefox. One of the great things about Firefox is the fact that there are a huge number of Add-ons that can be downloaded. Add-ons like ScribeFire a fully featured blog editor, Clipmarks allowing you to clip the best parts of Webpages and Answers that lets you to point at any word and get the relevant fact or definition. And much, much more https://addons.mozilla.org/en-US/firefox/recommended

Interesting Sites

Become.com is a great shopping comparison site. When you first visit the site you'll see that the search form offers two options allowing you to "research" or "shop." As well as providing the usual product and price comparison services there is a huge amount of shopping-related content such as product reviews, technical information, forums where the product is discussed and more. http://www.become.com/

InsiteFul Quotes

"That which does not kill us makes us stronger." Friedrich Nietzsche

You can see our other Quick Quotes on the front page of www.netinsites.com; just refresh the page to see another one randomly selected from our database. Great for presentations or times when you want to appear to be a techno-dude(ss)!

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Best wishes

Alex Garden

Internet Strategy | Website Design | Website Promotion | Web Text Messaging | Email Newsletters | Online Sports Games | Content Management