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OCTOBER 2000 MARKETINGTODAY.COM (tm) eNEWSLETTER
The Online Guide to Marketing in the Information Age (tm)
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Dear Marketing Today subscriber,

As online banner ad click-throughs sink to new lows, it's difficult not to notice how online ad salespeople have switched their pitch from the wonders of online banners for generating click-throughs to why click-throughs really aren't important at all.

What online banner hawkers failed to take into account a few years ago was that banners were exciting and new, a novelty to Internet users. And, as any experienced marketer knows, new eventually wears off. Online, changes happen a lot faster than offline (as in Internet speed) --and the world of Internet advertising is certainly no exception. Like so many new things on the Internet, banner ads once attracted a crowd when they were new, but users quickly grew tired of them.

Chalk it up to banners experiencing their 15 minutes of fame with Internet users. Now, most banners have become no more than many other ads, a mere annoyance. In fact, banner ads are not much different than the television ads that interrupt that great movie or the telemarketing call that comes in the middle of dinner.

By using click-through-centric pitches, online banner salespeople were responsible for creating a one-dimensional unit for measuring the success or failure of the banner. Banner salespeople backed themselves into the proverbial corner and now are forced to come back to advertisers and tell them how banner click-through rates really don't matter because, according to AdReleveance's new report (see below), those who see your banner but don't click it are more likely to buy.

Could it be that the folks selling online banners a few years ago were actually training ad buyers to measure banners by the wrong metric and are now paying for their mistake by creating a sea of media buyers who don't believe in the banner?

I am certain of it.

"Sure Peter, easy for you to say these things now," I hear you saying under your breath.

Fair enough. I'll give you a similar situation that is happening right now. But these salespeople are a little wiser than the ones who sold banners.

Consider the banner story as the writing on the wall for today's
wonderfully high e-mail response rates. I (as others also have) can confidently predict that the current e-mail response rates will go down as more and more marketers use e-mail marketing and recipients e-mail boxes overflow with messages they simply don't have time to read. I am certain that many of you will agree that this is a given.

I get around 1,000 e-mails per week. Think I have time to read ads in all of those e-mails? Of course not. So, I am helping reduce response rates in those e-mail I never look at. And you're probably doing the same thing. In fact, I am sure it will not be too long before the greatest e-mail  marketing successes fall from double digit to single digit response rates. E-mail marketing's popularity itself will be what ends up killing the golden goose. And many salespeople hawking space in e-mail newsletters are singularly focused on pushing high click-through rates when they should have learned a lesson from the history of online ad banners.

Sure, new technological innovations will always come forward and capture Internet user's interest for brief moments in time. Some will even get their 15 minutes of fame like banners once did (remember how quickly we moved from static to animated banners?). But Internet marketers need to be careful not to view these devices one-dimensionally.

So, are online banner ads a waste of money?

I don't believe they are. But the click-through-centric perception of banner ads that once existed has clearly died. Consider AdKnowledge's  latest research showing  that customers conversions were higher for those who saw, but never clicked a banner than for users who clicked-through. Banners have value, but maybe this value is not adequately measured by a click-through.

Should we be on the look out for the next big thing for Internet
advertising? You bet. We should never stop doing this. Rich media, interstitials...there are a lot of choices. Remember, what works well today may not work as well tomorrow or may be replaced by something  superior.

Marketers must understand that Internet advertising is highly dynamic. We need to constantly monitor Internet advertising vehicles -- observing,  testing, adjusting and constantly increasing our understanding of these  vehicles and always watching for new vehicles to emerge that  compliment, improve upon or replace existing vehicles.

Sincerely,
Peter DeLegge
Publisher
http://www.MarketingToday.com

ADKNOWLEDGE STUDY REVEALS MORE CONVERSIONS COME AFTER AD IMPRESSIONS ALONE THAN AFTER CLICKS
Adknowledge's Internet Advertising Report finds that users that click
banners have a lower conversion rate than those who merely view an ad.

THE SHORT LIFE OF THE ONLINE AD BANNER
Ad banners not only have declining click-throughs, they also have short
life spans.

ADKNOWLEDGE: 60% OF ALL CONVERSIONS OCCUR IN THE FIRST 60 MINUTES AFTER A CLICK
According to AdKnowledge, the time lag from a click on a web advertisement to a sale or registration on a web site and indicates that 60% of customers who convert on a site after clicking on an ad do so within the first half hour after clicking.

ONLINE SHOPPERS TURN TO BRANDS THEY KNOW OFFLINE
New data indicates that in certain online markets, consumers buy from names they know and trust in the offline world, and that branding and brand equity play a major role.

THE POWER OF BRANDS: STUDY SHOWS AMERICANS CONTINUED PREFERENCE FOR NATIONAL BRANDS
It's still about the brand. A recent study finds that nearly half of
Americans are "National Brand Loyalists."

E-BRANDING: MOVING YOUR CUSTOMER PROMISE TO THE WEB
According to Arthur O'Connor of KPMG's eXante practice, the best way for a brick and mortar to launch an online operation is to develop a strategy that optimizes and re-enforces both. To do this, it's important to understand what's different about e-branding from traditional branding, and, just as importantly, what's not.

Related Stories on Other Sites
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Advertising On Internet Doesn't Click
Funny, I found this article right after I wrote my column for this
eNewsletter. The article skewers online advertising for not delivering results and for how dot-coms have blurred the line between editorial and advertising.  One source refers to banners as "weak and passive."

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