Advertising on the Internet

Matt Christoph February 22, 2011

It is undeniable that the creation and ongoing development of the internet and digital communication technologies over the past few decades has changed many aspects of the mass media landscape. This is especially true of advertising content, which is featured prominently in most forms of mass media, and plays a significant role in financing the operations of media outlets (Belch & Belch, 2009). Advertising can be defined as “any paid form of non-personal communication about an organization, product, service, or idea by an identified sponsor (Belch & Belch, 2009, p. 18).” At present, advertising on the internet remains somewhat limited in terms of reach and audience size when compared to traditional media like print or television, and is especially limited when attempting to reach certain demographics (Belch & Belch, 2009). Still, online advertising efforts have grown dramatically in recent years and are likely to continue growing well into the foreseeable future as digital communication technologies continue to develop, giving advertisers new and improved ways of not only reaching their target demographics, but also researching, tracking, and interacting with their audiences. The most common locations for the placement of online advertising include search engines, websites, and social media. The majority of online advertising takes place on search engines. In fact, search engine ads account for over forty percent of all internet advertisement spending (Belch & Belch, 2009). Search engines are websites which allow users to seek out text-based or multimedia content by searching for certain words or phrases. These sites receive an enormous amount of user traffic. For example, in October of 2009, over fourteen billion searches were conducted by users in the United States alone (Stokes, 2010). Google is the best known and most widely used search engine, with over sixty-five percent of all web searches world-wide originating from their site.
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Other popular search engines include Yahoo, Altavista, and Bing, which was introduced by Microsoft in 2009 (Stokes, 2010). When a search engine site is used to conduct an online search, the results returned fall into one of two categories. The first category, known as organic results, is not paid advertisements, but consists of online content which was found to be most relevant to the search term that was used. Organic results typically appear on the left and take up the main body of the results page. The other category of results is paid search results, which are in fact advertisements that the search engine displays when certain associated keywords have been searched for. The paid results are typically displayed towards the top of the right-hand side of the results page. Advertisers bid on the keywords which they would like their ads to be linked to, and on how close to the top of the list their ad will appear. Search engines typically are paid at whatever rate the advertiser bids whenever that ad is clicked on (Stokes, 2010). Since paid ads are required to be separate and clearly differentiated from the organic results, complaints and legal disputes have arisen in the past due to search engine sites which were not identifying paid advertisements as such, or were displaying paid search results within lists of organic results (Powell & Ralls). Private or commercial websites are also common locations for the placement of online advertising. The proliferation of computers and internet technology has enabled almost anyone to create their own website. Many private individuals create websites for their own personal use or for sharing their experiences, opinions, or various types of multimedia content. Some sites are developed by private individuals in order to give access to information, perform some

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function, or provide some sort of service to users free of charge. These individuals are then able to sell ad space on their site in order to make a profit or to cover the cost of operating and maintaining their website (Stokes, 2010). In regards to commercial websites, it is arguable that many companies have created branded sites which are expansive, interactive advertisements in their own right. Unlike the fleeting and costly placement of ad content within traditional media channels, commercial websites are available world-wide, around-the-clock, and kept under the companies’ direct control and supervision. These sites achieve traditional advertising objectives such as creating awareness, stimulating consumer demand, and disseminating product information. Furthermore, brand or product-specific websites can provide an outlet for two-way communication with consumers, or even convert sales instantaneously (Belch & Belch, 2009). A third and increasingly common outlet for advertising on the internet is social media, also known as web 2.0, consumer-generated media, or participatory media. Simply put, social media refers to any website or application where text, pictures, video, audio, animation, or any other type of multimedia content can be posted, viewed, shared, or commented on by a community of users. While most content in social media communities is generated by private, individual users, more and more content is being created for commercial purposes as companies and organizations continue to explore the marketing opportunities that social media sites offer them (Stokes, 2010). In fact, the use of social media for marketing a brand or product has become so ubiquitous that the lack of a presence in social media may be perceived as having an insufficient or outdated advertising strategy (Powell & Ralls).

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Social media sites take on various forms and provide different features and functionalities for their users. One of the best-known types of social media is a blog, short for web log, which is a sort of online journal on which the blog’s author or authors can share information or ideas, as well as multimedia content. A wiki is a website created and moderated by a community of users. Wikipedia is perhaps the most widely recognized example of a wiki site, although countless others exist, many of which are more inclined toward the selling of advertising space than Wikipedia has been. Sites such as Flickr and YouTube, the latter of which is now owned by Google, are examples of multimedia-sharing sites. The final major category of social media is that of social networking sites, the best known of which are Facebook, Twitter, and MySpace (Stokes 2010). The various types of social media offer many benefits and opportunities for organizations seeking to advertise online. Blogs are an attractive channel for communicating promotional messages. Amateur or semi-professional bloggers often seek to sell ad space on their sites, which can be quite inexpensive for low-traffic blogs, and can provide a good amount of exposure in the case of more popular, higher-traffic blogs. Companies or entrepreneurs might choose to set up their own blogs for their industry, organization, product line, or for specific products or services (Stokes, 2010). YouTube has proven especially useful for marketers. The video content on YouTube is available worldwide, on-demand, twenty-four hours a day. An advertisement placed on this site may be viewed hundreds of thousands of times by a myriad of viewers, receiving an amount of exposure which would be extremely expensive, if not impossible, to achieve when placing the

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same advertisement within traditional media outlets (Tuten, 2008). The rapid development of social media and related digital communication technologies enables advertisers to spread marketing content far and wide across the internet, with little to no cost on their part beyond the initial creation and hosting of the content (Kirby, 2006). Companies can also encourage users of social media sites like YouTube or Tumblr to create and disseminate content which advertises their brand. The term “crowdsourcing” is now used to refer to the recent trend of organizations inviting the submission of advertising content, product concepts, or other innovations from online communities (Stokes, 2010). Brands such as Puma, Chrysler, and TurboTax have all hosted user-generated video contests via YouTube (Tuten, 2008). Perhaps the best option, however, for social media advertising is to place advertisements on social networking sites, the most prominent of which being Facebook. As of September 2010, Facebook boasted over 550 million users around the globe, and was expected to bring in advertising revenues of 1.4 billion before the year’s end (Stone, 2010). This site, and others like it, allows users to connect with various networks of friends, family, or co-workers; share or comment on user-generated content or content linked from external sources; and interact with other users in various ways. One reason that the site is such a viable option for online marketers is that most users have already provided a great deal of information about themselves, and still more can be gleaned from their connections and interactions with others, group memberships, content or status postings, and other user behaviors. The activities of users on the site are recorded and tracked, allowing marketers specific and accurate insight into

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the characteristics, behaviors, and attitudes of their target demographics, and enabling them to target specific users, conduct market research, or invite feedback on their brand image, product or service offerings, or advertising efforts (Tuten, 2008). The reason why social networking sites like Facebook have become so lucrative, and why they are able to offer membership to millions of users for no charge, is because of the massive revenues that they have been able to generate due to their appeal and effectiveness as a medium for online advertising (Stokes, 2010). There are many benefits for using search engines, websites, or social media for the dissemination of marketing communications. Advertising on the internet is less limited in scope than advertising in traditional media, since it can incorporate any combination of text, images, video, audio, animation, or interactive content all within a single ad (Stokes, 2010). Online promotional efforts can be measured and tracked in real time, reporting back to the advertiser information such as how many times the ad has been viewed, who viewed it, and what that individual did after seeing the ad (Stokes, 2010). Online advertisements can be personalized or targeted to specific users in ways that traditional media ads simply cannot (Tuten, 2008). For these reasons and many others, online advertising has assumed an important role in the mix of marketing activities which organizations engage in to create awareness of their offerings, stimulate interest, reinforce brand image, and drive consumer demand.

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Works Cited:
1. Belch, G., & Belch, M. (2009). Advertising and promotion: an integrated marketing communications perspective (8th ed.). New York: McGraw-Hill/Irwin.

2. Kirby, J., & Marsden, P. (2006). Connected marketing: the viral, buzz, and word of mouth revolution. Amsterdam: Butterworth-Heineman.

3. Powell, J.A., & Ralls, L. (2010). Best practices for internet marketing and advertising. Franchise Law Journal, 29(4), 231-238. Retrieved from EBSCOhost.

4. Stokes, R. (2010). The essential guide to e-marketing. Irvington, NY: Flat World Knowledge, Inc.

5. Stone, B. (2010, September 27-October 3). Sell your friends. Bloomberg Businessweek, 66-72.

6. Tuten, T. (2008). Web 2.0: social media marketing in a web 2.0 world. Westport, CT: Praeger Publishers.

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