Professional Documents
Culture Documents
History
Majority business owners worldwide know that the Internet has now
become an essential tool when it comes to running their businesses
successfully. However, you should also understand the role played by the
Internet in the lives of their customers. You should be capable to locate
people who are using the Internet; their key interests in the time spend on
the Internet and their preferences to purchase products and services on a
daily basis.
Source:- http://www.exchange4media.com/e4m/bottombarfiles/Internet-
Advertising.asp
Introduction
Most people are still not aware of the formidable potential of the Internet.
If your business has not started harnessing this growing phenomenon, its
time to act now! Why? The Internet is growing at such a phenomenal rate
and that it is reaching a far wider audience faster than most known
mediums, Internet Advertising is fast becoming one of the most effective
way of advertising for businesses. Currently, it is predicted that there are
more than 1 million new first-time Internet users monthly and over 900
million people using the Internet worldwide. Any small, medium or large
company that wish to boost its sales should go online to reach the targeted
audience using techniques involved with Internet Advertising, Web
promotion and Internet marketing.
Source:- http://www.galatta.com/advertising/internet_advertising.asp
By:
SamiFab
People opt for internet advertising methods because practically half of the
world's population knows HTML. If you have your own business, you have
to decide on what internet advertising method works for you. Ask yourself
what are you going to avail of: the expensive internet advertising methods
or the cheap ones? Others will pipe in "expensive!" immediately, but they
don't know cheap internet advertising method attracts great benefits as
well.
Here's the lowdown and a comparative look on the cheap and expensive
internet advertising methods:
The Expensive:
1. Pop-ups. Not only is this expensive, but also outright annoying that
visitors close pop-up windows without even bothering to know what
they're all about. This is an internet advertising method that you can do
without.
Fly ads are derivatives of pop-ups which are also equally irking to the
visitors.
2. 1. Pop-ups. Not only is this expensive, but also outright annoying that
visitors close pop-up windows without even bothering to know what
they're all about. This is an internet advertising method that you can do
without.
Fly ads are derivatives of pop-ups which are also equally irking to the
visitors.
2. Pod casts.
How does this one work? When someone types in a keyword related to
your site, your URL is automatically included in the first page of the top
results. Fixed payment for the search engine allows just that. Expensive,
yes, but if we're talking about Google and Yahoo search engines here, then
don't give it a second thought.
The Cheap:
1. Blogging.
Go along the bandwagon and blog about your website. This is an internet
advertising method that is popular as of the moment, so you never have to
worry that this will never spur outcome. All you have to do is sign up for a
blogging account, post and voila! You don't even need to pay!
This is cheap and dependable. If you submit your site to smaller search
engines, you have bigger chances to get bigger results. Remember that the
search engine giants can dwarf and overlook your site easily, so this
internet advertising method might just be the right one for you.
3. Text links.
This is not just cheap...this is virtually free! Let someone text link your site
and return the favor.
I’m not talking about the type ad ads like banner ads, CPC, CPM etc., i’m
going to discuss here about the nature of working of Ads .
Target Advertising
This is very common method as you all know it very well. These Ads are fixed on
the basic of content of that particular webpage or keywords used on that webpage.
For Example -
If you are viewing a webpage or article about “tips for bloggers“, the Ads on that
page will be of blogging, SEO and hosting related one which depends on the
keyword and its density of that particular web page.
This type of ads are said to be “target advertisements” because these are
already targeted relevant to the content or keywords of the webpage.
Behavioral Advertising
This is recent time improvement by google. These are dynamic Ads which can able
to change from user to user.
Example -
If you are traveler and love to travel and discover new things. You will be frequently
searching for travel related websites from your browser via search engine.
Now google will store your interest as “travel” in its cookie. Now whenever you surf
websites or blogs you can see google Ads relevant to “travel” and not based on the content
of that particular web page as we discussed in target advertising.
This type of working style of Ads is known as “Behavioral Ads“. Which is dynamic, based
on the user interest of what they are searching the web. This type of Ads will provide them
more relevant results and make the advertiser to reach their customers very easily.
http://www.technoskillonline.com/2010/09/different-types-of-internet-or-online-
advertising/
Many people, perhaps even a majority of people, will use search engines
and the Yahoo! directory to find what they're looking for on the Web. So
the place to start in promotion is to design webpages that will be indexed
well by the search engines, using descriptive titles and accurate META
tags. When you're ready, submit your site so that search engines will index
("spider") it, using a submission tool such as the All4One Submission
Machine http://www.all4one.com/all4submit/ or JimTools.
http://www.jimtools.com/ Getting a listing in the Yahoo! Directory is the
most important task -- and the most difficult. You may even have to pay
them $199 to agree to consider within one week whether to add your site.
Search engines are important. Be persistent. If your site doesn't show up
within a few weeks, submit again ... and again ... and again.
But with hundreds of millions of webpages, and only 15% to 20% of them
indexed, it's very easy for your site to get lost. The remedy (which adds to
the clutter) is to create a set of doorway or gateway webpages, each tuned
to score high on a specific search engine for a specific search word or
phrase. While there is excellent software available for search engine
positioning, Web Position Gold http://www.webposition.com/d2.pl?
r=AQH-55E7 for $150, I recommend that small businesses outsource this
task for $1000 or so, plus a $100 to $150 per month "maintenance" fee.
The task is very time intensive; it isn't really a spare-time project. More
info in the Search Engine Marketing section of the Web Marketing Info
Center. http://www.wilsonweb.com/webmarket/searchengine.htm
2. Linking strategies
Linking strategies are a second essential type of site promotion. The more
links pointing to your site, the more traffic you'll experience (and the
greater perceived "popularity" will rank you higher in the search engines).
To get someone to link to your site you need to ask. The simplest way is to
find complementary sites, link to them on a linking page, and ask them to
link to you. The key, of course, is for your site to have content that so good
that it's worth linking to. No one wants to link to a nothing website.
Ask for links on sites that cover your industry, as wells from associations
your business belongs to. One twist on this is to join a Web Ring with each
member site linking to the next member site along the chain.
http://www.webring.org/ Other approaches are to offer the best (and
most trafficked) websites an "award" that consists of an award logo with a
link pointing back to your site. Another popular method is to join a banner
exchange. For every two banners displayed on your site promoting other
businesses, one of your banners will be shown an another member site.
The biggest exchange is Microsoft bCentral LinkExchange.
http://adnetwork.bcentral.com/ I've given up on the so-called Free For All
(FFA) linking sites; don't even waste your time there. Another important
form of linking promotion involves paying affiliates for sales resulting from
links to your site, but we'll cover that under paid advertising.
3. Viral strategies
Of course, you probably know by now that sending out mass e-mails to
huge lists of e-mail addresses is a no-no. It violates the principle of
Permission Marketing that says people respond better to a marketing
message they have agreed to receive. Unsolicited Commercial E-Mail (UCE)
also runs contrary to a long-standing Internet tradition that responds to
SPAM with angry flames and enough returned e-mail to cause your ISP to
shut down your account very quickly. If you're interested in building a
long-term business based on trust, don't send SPAM. See the E-Mail
Marketing Section of the Web Marketing Info Center.
http://www.wilsonweb.com/webmarket/email.htm
7. Networking
You'll notice that most of the first seven types of Internet Marketing can be
done in-house relatively inexpensively (with the possible exception of
search engine positioning). Of course, you may be able to find a marketing
firm to which you can outsource some of these functions, but you can
probably do a fine job yourself -- after all, it'syour business, and you are
the one who can promote it most effectively.
But there comes a point that to get wider exposure, to break into the
consciousness of the thousands of people who never haunt your end of the
Web, you may need to resort to paid advertising. You'll be paying high
traffic sites or Internet publications to include a graphic or link that will
channel large numbers of people to your site. There are several popular
forms of paid advertising, with new approaches cropping up all the time:
Banner ads have been around the longest. Typically these are 468x60
pixel animated and linked graphic ads that appear at the top of a
commercial webpage. They are usually sold on a CPM (cost per
thousand page views) basis. Targeted sites may get CPM rates of $35
to $50 or more, but banner ads to reach general audiences are priced
$1 to $10 CPM. Banners that pop up on search sites triggered by a
keyword can cost $20 to $30 CPM.
But banner ads can be expensive. Do the math with me. If you're
paying $10 CPM and the click-through rate is an industry average of
0.5%, then it costs you $10 to get 5 people to your site, or $2 each. If
only 5% (or 1/20th) of the visitors to your site make a purchase, then
the "customer acquisition cost" is $2 x 20 or $40. You need a fairly
high transaction total to pay out $40 per sale for advertising. Your
strategy, however, may be to pay a higher initial customer acquisition
cost but get a customer you can keep and market to for the next
several years. You may lose money on the first sale, but make it up on
the second, third, fourth ... and 20th.
Paid Listings in Portal Sites. To get noticed, your online pet store may
need to pay for a listing under the "Pets" category at Lycos Shop. For
this you may pay a flat fee or a percentage of the sale. Consider it the
equivalent of paying rent to enjoy the foot traffic that a suburban mall
might attract. More at the Banner Ads Section of the Web Marketing
Info Center. http://wilsonweb.com/webmarket/ad.htm
Sponsorships are longer term paid ads on websites or e-mail
newsletters.
Pay-per-Click Links can be purchased on search engines such as
GoTo.com http://www.goto.com The price per click for the top spots
depends upon what your competitors are willing to bid. ValueClick
offers banner advertising on a per click basis. http://valueclick.com
Pay-per-Sale Advertising is popularly known as an Affiliate or
Associate Program. The merchant signs up a number of affiliates who
place a link or linked graphic on their site. If a sale is made to a
customer coming through that link, the affiliate earns a commission,
typically 5% to 15% of the transaction total. This can be an effective
-- and safe -- way to advertise, since you only have to pay when a sale
is made. You can purchase software to run your own program, but I
recommend outsourcing this to a service bureau such as Commission
Junction, that charges an initial set-up fee and then 20% of the
commission you pay your affiliates. http://www.cj.com/go.asp?
69320 More info in the Affiliate Program Section of our E-Commerce
Research Room. http://www.wilsonweb.com/research/associate.htm
Paid ads in targeted e-mail newsletters can be very effective. There
are hundreds of thousands of e-mail newsletters, many of which have
very modest advertising fees. Click through rates are likely to be in
the range of 1% to 3%. You'll find several e-zine directories in
the Doctor Ebiz Directories of E-zines page.
http://www.doctorebiz.com/vol1/000329c.htm
Opt-in E-mail Advertising involves sending a stand-alone ad for your
business to individuals who have (hopefully) volunteered to receive
information from your kind of business. These are called "opt-in" lists,
since the list members have agreed to receive information. Avoid
"opt-out" lists where recipients are placed on a list involuntarily and
then invited to unsubscribe if they want to. Opt-in lists can be quite
targeted, with ads getting a 1% to 3% click-through rate. Expect to
pay about 15 cents to 30 cents per name; the list broker will do the e-
mailing on your behalf. You'll find a list of brokers in the Targeted
Direct E-Mail Lists Section of the Web Marketing Info Center.
http://www.wilsonweb.com/webmarket/lists.htm
Certainly, there are many more types of paid advertising, but these are
some of the most common and most effective.
http://www.wilsonweb.com/wmt5/plan-4promotion.htm
Advantages & disadvantages
Today, majority of the people spend their work and leisure time in front of their
computers on the Internet. As social networking sites replace meeting up with
friends and searching the Internet for information rather than going through books
becomes the norm, advertisers are seeing a huge potential for marketing and
advertising various products and services on the Internet.
It is a well known fact that for websites to get traffic to push the owners
online business forward that Internet advertising is a fast way to get the
traffic they need to increase both their website popularity as well as the
potential value the site has to bring in profits to the site owner.
I am sure you will have your own opinions but these are my thoughts on
both advantages and disadvantages to just a few internet advertising
methods.
This is a fast way to drive traffic to new sites to build there popularity and
increase revenue in the shortest time frame possible.
Pay-per-click Advantages
Gets high exposure across a variety of search terms providing the easiest
way to get in front of the largest audience possible using combinations of
search engine exposure as well as additional exposure via content
networks.
Pay-per-click Disadvantages
Can be time consuming just managing the ad campaigns, testing and tweaking ads
to get the best return, to low a bid price will give limited exposure and has the
highest competition across all internet advertising methods making harder to be
profitable.
Plenty of banner exchange networks that will get you exposure across a lot of
similar websites making it easy to select the audience you need to attract and
allows you to control which websites have your banner ad displayed. Selecting the
appropriate category ensures your visitors are targeted and interested in what your
site has to offer and is cheaper than most methods of advertising.
Wide Reach
When it comes to reaching a wide range of customers, no other medium can beat
Internet. By advertising on the Internet, a small manufacturer in one part of the
world can find customers in the other. Internet advertising has broken all
geographical restrictions that existed with other mediums. Global companies, small
local businesses, anybody and everybody can increase their product sales and
profits by online advertising. This is definitely one of the exclusive advantages of
advertising on the web.
Target Oriented
On the Internet, you will find websites which cater to a particular group of people
who have some specific interests or who belong to a particular age group. There are
sports websites, medical websites, technology websites, social networking sites
which are mostly frequented by youngsters, religions websites, travel websites, etc.
Thus, Internet marketing and advertising gives businesses an opportunity to reach
people who would be specifically interested in buying their product. For instance, a
new cellphone in the market can find it's potential customers if advertised on a
technology or a social networking site.
Quick Conversion
One of the foremost advantages of Internet advertising is that the conversion time
of the advertisement into a sale is very less. Most of the advertisements on the
Internet have links which allow the customers to purchase the product then and
there. This in a way hikes the sales and profits of any given business.
Highly Informative
From the consumer point of view, one of the advantages of advertising on the
Internet is that they can know in detail about the product, its features, durability,
method of use, etc. With some advertisements, there are consumer reviews
available which help a customer to make an informed decision with regards to
buying a product.
Cost Effective
Another of the advantages of Internet advertising is that it is very cost effective.
With other mediums of advertising, be it television or print, you can not say for
sure whether the customer who is watching or reading the advertisement is actually
going to buy the product. But through "pay per click advertising", a marketer is
actually paying only when the potential customer visits his website or looks through
the product that is being sold. So, comparing from this point of view, Internet
advertising costs are much less.
Easy to Use
All type of businesses, even the ones which have just started out, will find
advertising on the Internet much easier. With other advertising mediums such as
television and print, businesses need to hire the services of an advertising agency
to create appropriate advertisements for them and also to buy advertisement space
in newspapers or televisions. With web advertising, all these headaches do not
exist. So, one of the main Internet advertising advantages is that even a business
which is just a day old can advertise it's products and services online, by starting
it's own website.
http://www.buzzle.com/articles/advantages-
of-internet-advertising.html
Do You Know the Latest Trends in Online
Advertising?
Sensing its reach and importance many online business publications or magazines have
taken online media advertising as a hot topic and keep a close look at the changing
trend. Being the newest and hottest field online media advertising has become the talk
of the town. According to the experts this new advertising mode carries a lot of potential
and will surely rake the moolahs. Also they think that online media advertising is in a
transition period and soon it will outshine other media with its reach and sustainability.
Online media advertising is a hot fad and exchange4media carries latest news and views
and analyses about this fast emerging medium. Thus, if you are new to the business and
looking for more ways to popularize your business then online media advertising is best
for you. Therefore for more information on online media advertising, advertising and
marketing services, Indian advertising agency and Internet advertising please
visit www.exchange4media.com.
http://www.masternewmedia.org/top-internet-trends-2010-a-guide-to-the-best-
predictions-from-the-web-part-2/
you are looking for the top internet 2010 predictions, anticipations and trends
from the top bloggers, the tech thought leaders and the top new media sites out
there, you have landed in the right place. In part 2 of this MasterNewMedia guide to
the top Internet trends for 2010 (Part 1), you will find indeed some of the most
interesting and provocative anticipations about new media, and about the future of
online marketing and communications on the Internet.
Content formats: One of the main difficulties of the web is being able to
really track a story as it develops and creating engaging formats for long-
form articles. In 2010, news organizations and publishers will design stories
that are more suited to the way readers consume online content. As a result,
other formats that are either engaging and eye-catching will gain momentum
in 2010, like the blogozine.
Content nesting: In 2010 your own content will spread on multiple
locations more rapidly than you can imagine. That is why your website
content needs to be nested in as many content aggregation sites as possible.
Social media, RSS / blog directories and influential websites should be your
main target. Why is this really important? Picture this: If you have a video on
your website that is not on YouTube, people on YouTube will not bother
searching for your website, because they simply do not need to go
elsewhere. For them, YouTube already represents the total number of videos
available on their topic of interest. Got it?
Social media marketing: A survey by VerticalResponse, Inc. shows
that 68% of small businesses plan to increase social media marketing. Social
media will indeed continue to be a great way for marketers and brands
to create conversations with customers. So, be sure to make 2010 your year
to test content that attracts repeat and referral business. Customers are
more likely to respond to social media marketing because they already know
you and trust you based on feedback from other people or their prior
purchases.
Online reputation: With more and more consumers making decisions based
on what they find online, small business owners will have to pay greater
attention to track the buzz around their brands. As consumers prove to
be highly influenced by online reviews and comments, business owners that
do not monitor their brand mentions may have a hard time to prevent
negative word of mouth. In 2010 expect those that will invest time protecting
their online identities to succeed, and others to fail.
Paid / free content: A recent Forrester report stated that 80% of U.S.
consumers will not pay for online content. Another survey by BCG showed
that most people will pay a maximum of $3 per month for online paid
subscriptions. What this means is that brands of 2010 are going to be built
through a different model, based on consumer demand, the endless supply of
content and the free distribution systems we all have.
Online video: In 2010, online video will keep growing, keeping pace with
the good trends of this year. Online video is interactive, memorable, widely
accessible, cheap to create and highly shareable, that is why entrepreneurs
and business owners are willing to invest even more on video. It is crucial
though, that you do not overlook your text content for video. As powerful as
video can be, it can be more cumbersome than text because you cannot scan
a video as quickly as you can scan a page of headlines, links and text to
quickly find the exact information you need.
Online video advertising: Pre-roll ads will continue to dominate online
video advertising. No innovation from Hulu, YouTube or Vivaki will prove as
effective as a 0:15 or 0:30 coupled with a companion ad (here IAB video ad
formats). YouTube only gains massive market share with its abundance of
pre-roll and unless a brand new alternative is developed in the coming
months, expect pre-roll to stay.
Business models: Expect new business models to emerge clearly in 2010.
While alternative monetization opportunities have already sprung in 2009, it
is next year that new business models will reach maturity and become a
serious option for Internet entrepreneurs. Whatever you may choose, your
main goal should be to increase, extend and diversify the range of your
revenue-making channels. Entrepreneurs that have bet all their horses on a
single business model may find unpleasant surprises, so start acting now.
Hyper niches: As already written, in 2010 content will be more and more
ubiquitous and accessible. Those that will have the best content next year
will float to the top, while everyone else will make less money and have
fewer opportunities. It will be much harder to compete with big brands,
which means next year the focus will be on niches and what John
Arnold of Entrepreneur defines "hyper-niches." People will have to
really narrow down their market niche in order to stand out and succeed.
SEO: Conversion rate optimization will dominate SEO next year. Still the
most under-utilized and highest ROI activities in the marketing department,
conversion rate optimization will reach more awareness and brands will focus
on improving conversion over time. Online businesses can generate so much
revenue from this, yet few invest. 2010 will establish this trend.
In part 2 (part 1) of this guide to the top Internet predictions and trends for 2010,
you can have a peek at what these coming months may indeed have in store for
you.
If you are into exploring what's coming up next before it hits you unprepared
this is a perfect place to start.
Link: http://www.masternewmedia.org/top-internet-trends-2010-a-guide-to-the-
best-predictions-from-the-web-part-2/#ixzz1HEyDOuYH
http://msmdesignzblog.com/2011/03/internet-advertising-trends-to-look-out-for-
in-2011/
Home » Internet Advertising Trends to Look Out for in 2011
1digg
If you’re like the majority of our readers, you’re a business owner looking for more
effective ways to advertise your website. There are several things you can do this
year to give your business a boost in the right direction. As we are closing in on the
first quarter of 2011, here are a few Internet advertising trends to look out for.
Desktop usage will decrease. The amount of time users spend on mobile devices
will certainly increase. I believe this comes down to convenience more than
anything else. People are on the go. Users are not strapped down to desktops
anymore leaving them immobile. The current smart phones and now the tablets
such as the Apple iPad and Motorola Xoom make searching the web, exchanging
emails and social networking as simple as snapping your finger. Can be done
anytime and any place. And frankly, I find myself even using my laptop less.
Mobile activities. The top activities on mobile devices will include shopping and
sharing information. With so many great apps that are currently available and new
apps in the works, the mobile device continues to keep the user occupied and
excited. Besides the apps, companies are understanding the importance of making
their websites mobile friendly. This will certainly increase traffic and sales if it offers
ecommerce. And since the new tablets are displaying websites just like your
desktop browser would, online shopping couldn’t be easier and more convenient.
Users are browsing while grabbing coffee, waiting in line, riding the train, etc. All of
these users become potential buyers!
Social media ads. More businesses will begin to use social media ads on sites like
Facebook to increase the traffic to their website. Facebook advertising marketplace
is becoming more like a social media search engine. Industry experts suggest using
catchy titles and buzz words within ads to attract consumers. Social media ads are
also very intelligent. Have you noticed while on Facebook that the ads appearing
within your profile page or news feed are geared towards your hobbies or
interests? This isn’t a coincidence. This is a very strategic tactic now used within
the social network. And it is brilliant since the ad impressions are not being wasted
on users who would have no interest in your product or service. This all comes
down on how your personal information is being shared. That is a whole different
topic in itself. But it is a fact that targeted advertising works and in this
environment, it’s well worth the small investment to purchase ad space.
Content is still king. The content that you use to attract your target audience can
make or break your web presence. Make sure your content immediately engages
your readers. Web users are less patient than ever before. It is better to use less
words to describe your product or service than long 500-800 word web pages. This
also ties in with mobile device users. Imagine what a 500 word page would look like
on your 3 or 4 inch smart phone screen!? You just lost that potential consumer.
Demographics. According to eMarketer, more than 95 percent of teenagers will be
using the Internet in 2011. This includes Internet usage through mobile phone
devices as well. From ages 3 to 17, it is estimated that almost 39 million are
internet users. Only 10 years ago, there were only 11 million teens online. That is a
huge increase and there are no signs of that number declining.
Based on the above, social media and mobile advertising will play dominate roles
for web marketers this year. Business owners who utilized social media and mobile
advertising in 2010 have noticed a significant increase in the amount of business
they attracted to their websites. With this new trend, this is an important area for
marketers to focus on in 2011.
Conclusion
Editor’s note: The following is a guest post by Eric Clemons, Professor of
Operations and Information Management at The Wharton School of the University
of Pennsylvania. In it, he argues that the Internet shatters all forms of advertising.
“The problem is not the medium, the problem is the message, and the fact that it is
not trusted, not wanted, and not needed,” he writes. The views he expresses are
his own, and we present them here to foster debate. (Obviously, we hope there is
a place for advertising on the Internet since it pays our bills). Update This post
has obviously touched a nerve. Clemons responds to his critics below at the bottom
of the post.
Pushing a message at a potential customer when it has not been requested and
when the consumer is in the midst of something else on the net, will fail as a major
revenue source for most internet sites. This is particularly true when the consumer
knows that the sponsor of the ad has paid to have this information, which was
verified by no one, thrust at him. The net will find monetization models and these
will be different from the advertising models used by mass media, just as the
models used by mass media were different from the monetization models of theater
and sporting events before them. Indeed, there has to be some way to create
websites that do other than provide free access to content, some of it proprietary,
some of it licensed, and some of it stolen, and funded by advertising.
The idea that content has a price and net applications should find ways to earn a
profit without providing free access to other people’s content gets explosive
reactions; when virtual reality pioneer and tech guru Jaron Lanier suggested in
a New York Times Op Ed that authors deserved to be paid for their content he
actually received death threats. But other models are possible and several
suggestions for alternative forms of monetization are offered below.
Better targeting of ads using individual interests and individual behaviors will
ensure that we do not bore or annoy as many people with each ad, but cannot
address the trust issue. As for paid search, it is closer to other mechanisms that
allow a website to sell access to potential customers. It works effectively as a
revenue source for Google, of course. But it surely is not replicable for the average
content website.
3. Advertising will fail for three reasons:
There are three problems with advertising in any form, whether broadcast or
online:
Yes, both network executives and their ad agencies have noted that we are not
watching traditional ads, and they attribute this to the fact that we have moved
beyond newspapers, televised network news, and broadcast movies, to video
games, iPods, and the internet. Porting ads to a new medium will not solve the
three problems noted above. The problem is not the medium, the problem is the
message, and the fact that it is not trusted, not wanted, and not needed.
Again, my research suggests that there are three general categories for creating
value that can be monetized, including selling real things, selling virtual things, and
selling access. Some websites exist solely to sell real things. Many of the best-
known perform aggregation of demand, so that there will be enough customers to
justify stocking and selling items for which there is only limited demand. Amazon is
merely the best-known example. Sites like Amazon and Zappos are especially good
for long tail items … where else do you go for a copy of the Green Sea of Heaven,
Elizabeth T. Gray’s magnificent translation of the Ghazals of Hafiz, or for a pair of
size 20 basketball shoes? Selling real things online has been studied since the
advent of interest in eCommerce and will not be discussed further here. Other
websites sellvirtual things. These activities fall into three categories:
Finally, some websites create and sell access to customers. Again, this can be
divided into multiple categories.
Misdirection, or sending customers to web locations other than the ones for
which they are searching. This is Google’s business model. Monetization of
misdirection frequently takes the form of charging companies for keywords and
threatening to divert their customers to a competitor if they fail to pay adequately
for keywords that the customer is likely to use in searches for the companies’
products; that is, misdirection works best when it is threatened rather than
actually imposed, and when companies actually do pay the fees demanded for
their keywords. Misdirection most frequently takes the form of diverting
customers to companies that they do not wish to find, simply because the
customer’s preferred company underbid. Misdirection also includes
misinformation, such as telling a customer that a hotel is sold out when, indeed it
is still available, if the hotel has chosen not to pay a promotional fee, and then
allowing the guest to choose an alternative property. Misdirection is, regrettably,
still a popular business model on the net, although for reasons I explored in
an earlier TechCrunch post on Google it seems ultimately to be unsustainable.
More significantly from the perspective of this post, it is not scalable; it is not
possible for every website to earn its revenue from sponsored search and
ultimately at least some of them will need to find an alternative revenue model.
Evaluation, assessment, and validation. The opposite of sending a
customer someplace other than where he wants is providing the customer enough
information for him to make an informed choice on his own. Recommendations on
TripAdvisor.com allow potential guests to evaluate and validate recommendations
provided by Hotels.com; not surprisingly, Hotels.com originally owned TripAdvisor,
and benefited greatly from it. Since Hotels.com did not attempt to influence or
censor TripAdvisor content the website was (and is) trusted and helped put
recommendations from Hotels.com at a level of trust comparable to those from an
experienced travel agent. There are at present only a few other examples of
website symbiosis like this, where community content on one site adds
considerable value for another; consider also the relationship between the
Beeryard’s list of new beers andRatebeer.com, where clicking on the name of a
newly arrived beer at the Beeryard will allow you to examine reviews on
Ratebeer.com.
Social search. Social search is a way of tailoring search based on the user’s
network of friends. Rather than searching for any hotel in Chicago, or for any
hotel that paid for the keywords “hotel” and “Chicago” I would like to be able to
ask for the hotel where my friends stay when they are in Chicago. This invades no
one’s privacy, avoids the annoyance of pushing ads at me when I am not
searching for something to buy, and provides more relevant results than paid
search usually can deliver. There are many problems with this, including the fact
that my friends may not be on Facebook or other networks yet and those that are
may not post their hotel or automobile or restaurant preferences. Most seriously,
while it is clear how Microsoft might benefit from this, using its Facebook
connection to undercut Google sponsored search, it is not clear how Microsoft or
any other firm could monetize this directly.
Contextual mobile ads. At present contextual mobile ads delivered by SMS
appear to offer much promise. Imagine a hypothetical all-knowing information-
based firm that (i) knows your location because you have registered to have the
information from your in-phone GPS shared with your friends and (ii) knows that
you like Thai restaurants because it monitors the content of your email and your
online restaurant searches and (iii) knows that you are hungry because you just
said so in a text message or Twitter post you sent from your phone. What a great
time for them to text you an advertisement for a nearby Thai restaurant, sent
directly to your phone. But why would you trust this? I remember when
Hotels.com used to refer me to the same hotel, albeit at different prices, when I
asked for a two-star or three-star hotel close to my office; I was never sure which
was more amusing, the 80% price increase for the same hotel when I was willing
to splurge on a three-star for my visitor, or the fact that there were comparable
hotels 20 blocks closer to my office. I suspect that my hypothetical all-knowing
firm will similarly be providing sponsored content; perhaps I will take a couple of
additional seconds in order to find the restaurant I really want. This probably does
not work as a form of advertising.
The internet is about freedom, and I suspect that a truly free population will not be
held captive and forced to watch ads. We always knew that freedom comes at a
price; perhaps the price of internet freedom and the failure of ads will be paying a
fair price for the content and the experience and the recommendations that we
value.
http://techcrunch.com/2009/03/22/why-advertising-is-failing-on-the-internet/