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Online and Mobile Advertising. Chapter Objectives. After reading this chapter you should be able to: Appreciate the magnitude, nature, and potential for online and mobile advertising. Describe how the online advertising process works.

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chapter objectives
Chapter Objectives

After reading this chapter you should be able to:

  • Appreciate the magnitude, nature, and potential for online and mobile advertising.
  • Describe how the online advertising process works.
  • Understand the various forms of online advertising: search engine advertising, display or banner ads, rich media, websites and sponsorships, blogs and podcasts, e-mail advertising, mobile advertising, and advertising via behavioral targeting.
chapter objectives cont d
Chapter Objectives (cont’d)
  • Describe the nature of mobile advertising: its forms (e.g., short message services, location-based services), benefits and costs, and strategies.
  • Understand the issues associated with privacy and online behavioral targeting.
  • Appreciate the importance of measuring online advertising effectiveness and the various metrics used for this purpose.
mobile headache the excitement and challenges of mobile advertising
Mobile Headache: The Excitement and Challenges of Mobile Advertising
  • Mobile ad spending is expected to grow to $2.5 billion by 2014
  • Versatile: Moving from SMS texts -> Web -> apps -> games -> social media
  • Excellent international platform for growth
  • Yet…. More apps (e.g., “Angry Birds”) don’t always equal better apps
  • Fit with company? strategy?
  • Not IT driven (rather, short 30-day program cycles driven by consumers)
  • May have to make tough decisions in moving ad spending from traditional media
mass online advertising
Mass Online Advertising
  • Internet is not a replacement, but a key element of IMC programs
  • Dating back only to 1994, the “Web” has become an important medium for Internet advertising.
  • Online advertising spending amounted to over $9.6 billion in 2004 (~4% of all advertising), $29 billion in 2012 (~17% of all advertising), and is estimated to grow to $40 billion by 2014.
many options for placing ads and promotions online
Many Options for Placing Ads and Promotions Online
  • Company Websites (e.g.,
  • Banner ads (click-through rates only .3%; B2B>B2C; brand familiarity; yet attention?)
  • Sponsorships and Microsites (small area paid for by external co.)
  • Rich Media: Interstitials/Superstitials/pop-ups/ online video ads
  • Browser ads (viewer is paid to watch ads)
  • Alliances and affiliate programs (e.g., AOL and Amazon;
  • Push technology (e.g., Real Video; Infogate/AOL)
  • Search engine advertising (keywords/targeted content; 40% of online ads), blogs (, podcasts (audio blogs; ) (Nielsen/McKinsey NMIncite tracks/ analyzes blogs)
  • E-mail ads (opt-in versus opt-out; e-zines; wireless; mobile phone/ text messaging)
  • Mobile Advertising (Google Goggles)
  • Social Media: Facebook, MySpace, Twitter, YouTube, Second Life, LinkedIn, Pinterest, Flickr... (;;; tracks/analyzes)
purchasing keywords and selecting content oriented websites
Purchasing Keywords and Selecting Content-Oriented Websites

Keyword Matching Advertising

Prospective advertisers bid for keywords by indicating how much they are willing to pay each time an Internet shopper clicks on their website as a result of a search (cost per click).

(Google Ad Words:

content targeted advertising
Content-Targeted Advertising
  • AdSense: sponsored by Google, this program enables advertisers to run ads on sites other than Google’s own site.
  • Google then acts as an ad agency placing ads and receiving a commission (e.g., 20%).
  • Recently expanded to mobile content and RSS (Really Simple Syndication) feeds used for publication (e.g., a blog entry).
rich media pop ups interstitials superstitials and video ads
Rich Media: Pop-Ups, Interstitials, Superstitials, and Video Ads
  • Pop-Ups: Ads that appear in a separate window.
  • Interstitials: Ads that appear between two content Web pages.
  • Superstitials: short, animated ads that play over or on top of a Web page.
  • Online video ads: audio-video ads that are similar to 30-second TV commercials, but are shortened to 10-15 seconds and compressed.
websites advantage sought by consumer versus stumbled upon
Websites(advantage: sought by consumer versus stumbled upon)
  • Uses for Websites
    • As an advertisement for the company
    • As a venue for generating and transacting exchanges between organizations and their customers
    • As a link to other integrated marcom communications
  • Well-Designed Websites
    • Are easy to navigate
    • Provide useful information
    • Are visually attractive
    • Offer entertainment value
    • Are perceived as trustworthy
mobile advertising
Mobile Advertising

2015: 4.9 billion phones worldwide; 2014: U.S. ad spending doubles to $2.55 billion

Google Goggles

measures of effectiveness for internet advertising
Measures of Effectiveness for Internet Advertising
  • Viewers(stay on site/page): number of viewers to a site (and unique viewers)
    • Ad views/page views/impressions: the number of times viewers see a Web page with an ad. (Used to calculate cost per thousand or CPM).
  • Hits (leave the site or home page): number of times a specific component of a site is requested/clicked on.
    • Clicks/click throughs: the number of visitors to a site that click on an ad to retrieve information.
    • Click through rate: % of ad views that result in an ad click. (Cost per click (CPC) can be calculated)
  • Cost per thousand (CPM) example for “”:
    • CPM = $10,000 per mo. x 1000 / 500,000 views per mo. = $20
internet and e mail advertising problems
Internet and E-Mail Advertising Problems
  • Privacy and Behavioral Targeting (online profiling via cookies and marriage of online and offline data: Double Click; Children’s Online Privacy Protection Rule)
  • Opt-in and opt-out battles
  • SPAM (unsolicited commercial e-mail: 2/3 of all commercial e-mail)
  • Phishing and international fraud (credit card #s, social security #s, ATM #s)
  • Click fraud with search engine advertising