The purpose of interactive advertising

It can be contended that each web site is in itself an advertisement since it can inform, persuade and remind customers about a company or its products and services. However, a company web site is not strictly an advertisement in the conventional sense, since money is not exchanged to place the content of the web site on a medium owned by a third party. Although Figure 8.18 implies the main aim of interactive advertising is driving traffic to a destination web site, there are other outcomes that a marketing manager may be looking to achieve through an interactive ad campaign. Cartellieri et al. (1997) identify the following objectives:

• Delivering content. This is the typical case where a clickthrough on a banner advertisement leads through to a destination site giving more detailed information on an offer. This is where a direct response is sought.

• Enabling transaction. If a clickthrough leads through to a merchant such as a travel site or an online bookstore this may lead directly to a sale. A direct response is also sought here.

• Shaping attitudes. An advertisment that is consistent with a company brand can help build brand awareness.

• Soliciting response. An advertisement may be intended to identify new leads or as a start for two-way communication. In these cases an interactive advertisement may encourage a user to type in an e-mail address or other information.

• Encouraging retention. The advertisement may be placed as a reminder about the company and its service and may link through to on-site sales promotions such as a prize draw.

These objectives are not mutually exclusive, and more than one can be achieved with a well-designed banner campaign. Zeff and Aronson (2001) stress the unique benefits of banner advertising as compared with those of other media. Of these, the most important are the capability to target relatively small groups of users and then to track their response. Online ads are also more responsive potentially since it is possible to place an advertisement more rapidly and make changes as required. Experienced online advertisers build in flexibility to change targeting through time. Best practice is to start wide and then narrow to a focus - allow 20% budget for high-performing ad placements (high

CTR and conversion). In an iMediaConnection interview with ING Direct VP of Marketing, Jurie Pieterse, the capability to revise creative is highlighted:

Another lesson we learned is the importance of creative. It's critical to invest in developing various creative executions to test them for best performance and constantly introduce new challengers to the top performers. We've also learned there's no single top creative unit - different creative executions and sizes perform differently from publisher to publisher.

Source: iMediaConnection (2003)

Page and ad impressions and reach

One page Impression occurs when a member of the audience views a web page. One ad Impression occurs when a person views an advertisement placed on the web page. Reach defines the number of unique individuals who view an advertisement.

CPM (cost per thousand)

The cost of placing an ad viewed by 1000 people.

Effective frequency

The number of exposures or ad impressions [frequency] required for an advertisement to become effective.

Clickthrough and clickthrough rate

A clickthrough [ad click] occurs each time a user clicks on a banner advertisement with the mouse to direct them to a web page that contains further information. The clickthrough rate is expressed as a percentage of total ad impressions, and refers to the proportion of users viewing an advertisement who click on it. It is calculated as the number of clickthroughs divided by the number of ad impressions.

Viewthrough

A viewthrough indicates when a user views an ad and subsequently visits a web site.

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