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Internet Marketing

Internet Marketing Web Advertising – Is it really worth it? Web advertising, not to mention the Internet itself, is still relatively new and therefore provides marketers with challenges that need to be dealt with, with caution. The realm of Web advertising is in uncharted territory. What implications will this new technology have for marketing? How can a business use the medium effectively? Setyn introduces the concept of interactive marketing through the words: “Interactive marketing uses new technologies to overcome practical database and direct marketing problems whilst building more rewarding customer relationships.” The developments allowed by interactive marketing through the Internet focus mainly on how profitable market segments were identified and how these segments were reached. Interactivity allows the opportunity to track individual customer’s one at a time and to build individual relationships with each. The main challenge that does and will continue to plague advertisers in the future will be persuading the viewer to try the service or product. Interactivity has three core characteristics: I. Offers much more information than a television advertisement. II. Requires the conventional copywriting skills combined with those of the direct marketer to turn the browsing viewers into sales prospects. III. The emphasis, simply due the nature of the medium, is more likely to be on sales promotion type tools to entice the viewers to visit an ad and from then on constantly refreshing the content and creative treatment, to ensure that they revisit it (Steyn, 1996) The introduction of interactive marketing begins an era where customers will choose the advertising they wish to see, when they want to see it. Consumers of today are evermore demanding personalized attention from businesses that wish to serve them. The modern consumer wants to know what product he is buying, what its characteristics are, how he can expect it to perform, what alternatives he is faced with and why he should pay the asking price for it. Interactive marketing on the Internet provides an ideal medium for the satisfaction for all of the demands of today’s consumer. Online shopping is an element of interactive marketing that has found itself under the spotlight. Internationally, the Internet is successfully selling everything from nuts and bolts to motorcars, property and traditional mail order products. While retail sites on the Web continue to grow, some sites are purely promotional. On the other extreme consumers are promised the lowest prices as the product is drop-shipped directly from the manufacturer to their doorstep. The Internet as a shopping mall has not enjoyed a favorable reputation as it is seen as a golden opportunity for sophisticated thieves to obtain credit card numbers. Recently, a groundbreaking development in online shopping was made by M-Web in collaboration with over a thousand tenants ranging from large corporations such as ABSA to small retailers and service providers. Bruce Cohen, general manager of M-Web interactive, claims that, “The M-Web mall is designed to accelerate interest in online shopping by providing a one-stop shopping environment under one virtual roof.” It is estimated that there is more than five million commercial pages on the Web, more than 100 companies are going online daily and that “net-watching” has become a dedicated function within many firms. Companies that are online are more inclined to use the medium as a means for communicating new product developments. The Internet is not yet a proven advertising medium that as such is untested, unregulated and unrefined. This very situation often results in wise businesses approaching Internet advertising companies that possess the necessary expertise to advertise effectively on the Internet. The origins of Web advertising are ironically rooted in what many consider as a frustrating method called “spamming” where messages concerning products or business information were sent at random to Internet users e-mail addresses. This form of advertising can be likened to common junkmail. Thousands of businesses have established a home page on the Internet which offers a wide variety of information such as: descriptions of the company and its products; a company catalogue describing product’s features, availability and pricing, company news, opportunities to speak with staff members, employment opportunities and the ability to place an order before leaving the site. Web advertising is becoming more and more a vital component of a firm’s advertising budget and therefore demands sensible and rational consideration and planning. It is vital for an organization considering an Internet marketing strategy to effectively coordinate each component. The bottom line is that the organization is putting themselves into the global marketplace. The direct set up costs to the marketer are likely to be in excess of $10,000 for an above-average site but, further to this cost, are the costs of site maintenance, enhancements and server storage. Driven by increases in usage – particularly among frequent Web surfers – and the availability of inexpensive Web access, Web advertising expenditures will reach $2.46 billion in 2000, according to Web Advertising 1997: Market Analysis & Forecast. Importantly, this continuous growth is consistent and stable, reinforcing the conclusion that marketers are increasingly recognizing the importance of the medium as part of the full media mix, whether it’s for brand marketing, direct marketing, retailing or customer service. The 1997 fourth quarter revenue figure marked the eighth record-setting quarter in a row. Total revenue in the first quarter of 1997 were $129.5 million, the second quarter posted $214.4 million, with the third quarter reporting revenue of $227.1 million. “1997 was definitely a breakthrough year for Internet advertising,” said Rich LeFurgy, IAB Chairman and Senior Vice President, advertising, ABC News/ESPN Internet Ventures. The Internet Advertising Bureau via its industry-leading Advertising Revenue Reporting Program announced that $906.5 million was spent on online advertising in 1997. Leading industry categories were computing products (33%), consumer-related (26%), financial services (11%), news media (11%) and telecom (9%). Yahoo!, a Web search engine, maintained its position as the top ad-supported site in 1997. Excite and Infoseek rounded out the top three ad-supported sites. “In just two years the Web has managed to establish itself as a legitimate forum with both advertisers and the public,“ said Matt Kinsman, EAMR editor. “Web advertising is no longer an ‘either/or’ proposition, but a necessary complement to traditional media.” The Web can be transformed into a research tool, a brand builder and an advertising medium in one swoop, something not offered by other media. Another advantage of this medium is that it provides advertisers with detailed demographics about who actually saw their advertising medium. Interactive media can operate in territories not covered by a company’s sales force. It can bring the showroom and sales pitch to the consumer’s location. One of the disadvantages of using this type of advertising medium is the lack of intrusiveness it offers. The persuasive elements of the Internet advertisement usually lie at least a few clicks away from the user’s current location. This could cause the user to lose interest in the product or then be intrigued by another banner. The World Wide Web, can support both consumer marketing and trade marketing objectives. The Web and its importance as a new medium has been recognized to the extent that it will be measured in all US media research from this year. The Web provides a company with access to a global audience of consumers in their millions, and also to a very wide range of companies. The Internet has provided marketers with new, exciting and challenging advertising prospects. There will undoubtedly be many lessons to be learned in the near-future concerning the intricacies and quirks of advertising on the Internet. Styen, C., Introducing Interactive Marketing. Marketing Mix. Volume 14, Issue 7 , July 1997 Rath, B., Marketing on the Web: Net Return. Marketing Mix. Volume 14, Issue 3, April 1997 Bibliography:

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