How Your Business Can Create Value With Online Advertising

Posted by on November 2, 2010 in Business Management, Marketing [ 1 Comment ]

Online advertising, like any other business tactic evolves over time.  In the 90’s this meant banner ads—but do they really work these days?  According to the IAB, (Internet Advertising Board) “online ad sales are up 11.3% for the first six months of 2010—hitting $12.1 billion—the highest total the IAB has ever recorded.” The flexibility and functionality of the online ad sector has attracted businesses in every industry, and in turn, flooded the online advertising market space.

At first online ads were new, exciting and effective; the ad viewer was not adept to tuning them out. Traditional online banner displays are potentially moving towards the likes of television ads, nothing more than background noise. According to ClickZ, “84 percent of Web users never click on banners. Of the 16 percent of Web users that do click on banner ads, the top 4 percent produce 67 percent of all clicks. Simply put, most banner clicking activity comes from 4 percent of the online population and the vast majority of Web users never click on banners.” We will examine the effectiveness of traditional banner displays to interactive rich media advertising and act as barometer for the future of the online advertising space.

One of the most important and relevant business theories of our current generation is Blue Ocean Strategy. Loosely, these concepts can be applied to just about anything in the business realm. Playing where others aren’t playing, and making the competition irrelevant by differentiating your offerings is the basis of the theory. This concept can be applied to display advertising, according to the Journal of Interactive Advertising, “If a stimulus has unique features that distinguish it from the rest of the visual field, it can be considered distinctive.” Banner displays, once were a blue ocean opportunity for advertising. Interactive rich media allows a wider range of user interactivity and potentially possesses a viable advertising medium.

Online Interactive

The Journal of Interactive Advertising conducted a study to determine the effectiveness of interactive ads vs. traditional banner displays. The results showed that the weekly click thru rates on interactive ads were 33%, in comparison to the 12% traditional banner displays.


Interactive Ad: (Getting users to balance)


Traditional .JPG Banner Ad

Extreme Targeting

Cookies allow a company to understand their websites visitors, but these sneaky little text files also allow advertisers to gather information about you. The future of online ads is targeting users one by one. Laura Sydwell, a writer for NPR says, “In a millisecond, advertisers may know that Jane is looking for a car, is a mother of three, lives in Phoenix and has a household income of $150,000. Advertisers looking for someone like Jane will then start bidding to get her to see their ad.”


Sponsorship ad with potential to target consumers

Blue Oceans- White Paper

Rich media interactive display advertising is great, but the market is flooded with banner ads.  LinkedIn is testing out an interactive white paper advertising method. White papers are business documents that a company may or may not write on a certain subject of expertise. In order to download the white paper, the user must input his or her information, a unique way to generate leads. TechCrunch reports, “The business networking site is testing a new feature that turns white papers into ads and presents them to the narrow group of professionals most likely to want to read them. LinkedIn members can get white papers for free, and in return sponsors get qualified leads.” However, white papers should be part of an integrated approach that creates business-customer rapport, not a trick move to generate a lead.

As the online ad industry matures we will continue to see new, innovative approaches for businesses to reach their end users. Interactive media is standard for many larger companies, but as the market matures we are seeing more and more small businesses shift away from .jpg display advertising. With your small business growth strategy, be sure to incorporate new and creative approaches to reach your customers. Sponsored white papers and targeted ad messages could be the future of advertising strategy.

Matt Krautstrunk is an expert writer based in San Diego, California.  He writes extensively for an online resource that provides expert advice on purchasing and outsourcing decisions for small business owners and entrepreneurs.

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