8.3. 4 Economics and Effectiveness of Advertisement Justifying ad on the Internet is more difficult than for conventional ad. One of the major reasons for this is the difficulty in measuring the results of advertising. Several methods are available for measuring ad, conducting cost-benefit analysis, and for pricing ads. They are discussed below. 1. Advertising Strategies and Promotions Associated ad display (text links) an advertising strategy that displays a banner ad related to a term entered in a search engine Ads as a commodity direct payment made by the advertisers for ads viewed Viral marketing(advocacy marketing): word-of-mouth marketing by which customers promote a product or service by telling others about it customizing ads: one-to-one advertisement ( Web casting) 2. Online events, promotions, and attractions Promotions designed to attract visitors are regular events on thousands of Web sites Bargains on the Internet Free samples, give-aways, and sweepstakes 3. Major considerations when implementing an online ad campaign: Clearly understood online surfers as target audience Powerful enough server prepared to handle the expected volume of traffic Assuming the promotion is successful, what will the result be? Consider co-branding-bring together two or more powerful partners 4. Advertisement Strategies Several advertisement strategies can be used over the internet. Before we describe will be useful to present some important considerations in Internet-based ad design 5. Passive Pull Strategy sually, customers will look for a site and visit it only if it provides helpful and attractive contents and display. This strategy when Web pages are waiting for a customers passive access, is referred to as passive pull strategy. The passive pull strategy is effective and economical when advertising to open, unidentified potential customers worldwide. However, since there are so many Web pages open to all customers, there is a need for a directory that can guide customers to targetedsitesForinstancerefertothesiteAdvertisingWorld(http:advertisingutexas.edu/word) This is a noncommercial site that can guide customers. In this sense, portal search engine sites like Yahoo can be regarded as an effective aid for advertisement. There sites are all equipped with directories for the registered sites A site may be either a pure advertisement site( which means it does not offer order entry and payment capabilities) or a complete retailing storefront (like Amazon) as described in chapter 2 The ads in the latter case can be directly linked to sales. In this case, the ad can be regarded as the first step of sales activity on the Internet. When the site is an e-mail, we can see its own director and search engines, which help find the desired products and services. In this sense, the directory in the e-mail can be regarded as the second step in the passive pull strategy 6. Active Push Strategy If customers do not visit the merchants'sites voluntarily, merchants need to actively advertise to the targeted customers. One option of this strategy is sending e-mail to the relevant people. The first issue to be considered by merchants adopting this strategy is how to obtain the mailing list of thetargetcustomersCompanieslikeDoubleclick(www.doubleclickcomhavestartedto generate mailing lists to meet this need. For a comprehensive list of such companies, refer to the directmarketingmenuinAdvertisingWorld(http://www.advertisingutexs.edu/world).Foracase8.3.4 Economics and Effectiveness of Advertisement Justifying ad on the Internet is more difficult than for conventional ad. One of the major reasons for this is the difficulty in measuring the results of advertising. Several methods are available for measuring ad, conducting cost-benefit analysis, and for pricing ads. They are discussed below. 1. Advertising Strategies and Promotions ▪ Associated ad display (text links): an advertising strategy that displays a banner ad related to a term entered in a search engine. ▪ Ads as a commodity: direct payment made by the advertisers for ads viewed. ▪ Viral marketing (advocacy marketing): word-of-mouth marketing by which customers promote a product or service by telling others about it. ▪ customizing ads: one-to-one advertisement (Web casting). 2. Online events, promotions, and attractions ▪ Promotions designed to attract visitors are regular events on thousands of Web sites; ▪ Bargains on the Internet; ▪ Lottery; ▪ Free samples, give-aways, and sweepstakes. 3. Major considerations when implementing an online ad campaign: ▪ Clearly understood online surfers as target audience; ▪ Powerful enough server prepared to handle the expected volume of traffic; ▪ Assuming the promotion is successful, what will the result be? Consider co-branding—bring together two or more powerful partners. 4. Advertisement Strategies Several advertisement strategies can be used over the internet. Before we describe them, it will be useful to present some important considerations in Internet-based ad design. 5. Passive Pull Strategy Usually, customers will look for a site and visit it only if it provides helpful and attractive contents and display. This strategy when Web pages are waiting for a customer’s passive access, is referred to as passive pull strategy. The passive pull strategy is effective and economical when advertising to open, unidentified potential customers worldwide. However, since there are so many Web pages open to all customers, there is a need for a directory that can guide customers to targeted sites. For instance, refer to the site Advertising World (http://advertising.utexas.edu/word). This is a noncommercial site that can guide customers. In this sense, portal search engine sites like Yahoo can be regarded as an effective aid for advertisement. There sites are all equipped with directories for the registered sites. A site may be either a pure advertisement site (which means it does not offer order entry and payment capabilities) or a complete retailing storefront (like Amazon) as described in chapter 2. The ads in the latter case can be directly linked to sales. In this case, the ad can be regarded as the first step of sales activity on the Internet. When the site is an e-mail, we can see its own directory and search engines, which help find the desired products and services. In this sense, the directory in the e-mail can be regarded as the second step in the passive pull strategy. 6. Active Push Strategy If customers do not visit the merchants’ sites voluntarily, merchants need to actively advertise to the targeted customers. One option of this strategy is sending e-mail to the relevant people. The first issue to be considered by merchants adopting this strategy is how to obtain the mailing list of the target customers. Companies like DoubleClick (www.doubleclick.com) have started to generate mailing lists to meet this need. For a comprehensive list of such companies, refer to the direct marketing menu in Advertising World (http://www.advertising.utexs.edu/world). For a case