Implementation of marketing strategy: Marketing communications

1. Implementation of marketing strategy: Marketing communications MARK 430

2. Marketing process • Target your market • Position your product • Communicate to your target audience • Communication • Advertising • Personal selling

3. 2 main goals of marketing communication • Brand advertising – aim is to build awareness of a product by putting the brand name and product benefits in front of users • Develop positive attitudes prior to purchase • Direct-response advertising – seeks to motivate action – BUY!

4. Online communications media types

5. Marketing communications we will look at over the next few weeks • This week: online advertising (banners, interstitials and rich media) • Week after study break: search engine marketing • Following week: email and viral marketing

6. What difference does the Internet make to advertising? • Traditional form of one-way, one-to-many mass advertising no longer necessary or appropriate • Web provides a highly targeted, receptive audience • Web advertising can be interactive, and therefore by definition, more engaging • Web provides a mechanism for instant action • Immediate gratification of the consumer not available with print, TV or radio advertising • Consumers complain more about web advertising than about other forms of advertising

7. Internet advertising • Advertising is non-personal communication of information through various media • Usually persuasive in nature about products • Usually paid for by an identified sponsor • Paid space on a website or in an email is considered internet advertising • The process of selling advertising on the Internet is very similar to offline media – web companies create content then sell advertising space to advertisers • But also include the situation where a content provider will pay to include that content on another firm’s site (sponsored content = advertising)

8. The importance of Internet advertising • Began in 1994 with banners on Hotwired.com • Saw strong growth until 2000-2001 (on a par with the drop in advertising spending in all media) • Now on the upswing again, as dissatisfaction with traditional media grows (see link to reading) • The importance of the Internet as an advertising medium varies across industries. Most advertising comes from following categories • consumer related advertising (30%) • computing (18%) • financial services (12%) • media (12%) • business services (9%)

9. How successful is web advertising? • Banner ad click-through rates are very low • around 1% of users actually click on a banner ad • of that 1%, around 5% actually follow through with a transaction • The web is very good at person-to-person interactive services, and at promoting product loyalty • Growth has been in interactive ads using “rich media” • Said to be twice as effective as traditional banners • Big payoff is in the capability to track ad effectiveness and ability to respond to change very quickly

10. Web site advertising formats • Began as static banners in the mid 1990s, added animation, then moved to the use of “rich media” • Interactive formats, including: • Banners • Buttons • Skyscrapers • Pop-ups, pop-unders, interstitials • Floater ads and Shoshkele (United Virtualities) • Rich media gallery (Macromedia) • For examples of all kinds of web advertising, go to • www.eyeblaster.com Eyeblaster

11. Paying for, and measuring usage Online media have varied payment schemes – unlike traditional media which is usually priced on a pay for placement basis (based on ratings) Ad Clicks • Aggregate number of user clicks on a banner ad • Number of times a banner ad is downloaded to a user’s browser and presumably looked at Ad Views (Impressions) Click-Through • Percentage of ad views that are clicked upon; also “Ad Click Rate” • Formula used to calculate what an advertiser will pay to an Internet publisher based on number of click-throughs a banner generates CPC(Cost-per-Click) • Cost per thousand impressions of a banner ad; a publisher that charges $10,000 per banner and guarantees 500,000 impressions has a CPM of $20 ($10,000 divided by 500) CPM • Going beyond click-through rates: • Clickstream data gives you the whole picture of a consumers movements before, during and after viewing an advert

12. Complexities of online advertising • Designing interactive rich media is challenging • Non-linear – consumer can take many paths • Getting the right balance between intrusive and engaging • Tracking effectiveness • Online ads delivered to individuals rather than to mass markets – makes placement and tracking much more complex • Technical complexity of rich media adverts mean closer ties between the advertiser and the media seller • Ad placement • Disagregated medium means ads must be placed with several Internet publishers to reach audiences

13. Helping marketers deal with these complexities • Workflow software to help in the buying, selling, and managing of managing of online ads – eg. Solbright • Macromedia and DoubleClick’s joint product to help manage both the creation and measurement of ad effectiveness • DART Motif

14. Advertising to wireless devices • Huge growth potential • PDAs, cellphones, laptops etc now widely used • Big question is – would mobile users rather pay for content, or will they tolerate advertisements in exchange for free content • Answer is not clear because of several factors • low bandwidth • small screen size • different techniques needed to track ad effectiveness • by-the-minute payment for air-time by user

15. Viewing advertising in exchange for viewing content • A growing trend as content providers try to make sense of business realities • www.ivillage.com - view ad before gaining access to site • www.salon.com - view ad in exchange for getting access to complete magazine article

16. The future of web advertising • Web technology allows for many interesting multimedia advertising formats • These catch attention when they first appear, but quickly become intrusive and annoying • Big backlash against pop-ups • Marketing fundamentals will prevail: Success is about reaching the right audience with the right message at the right time