The secrets of online advertising

February 2007

Despite a rather tight general advertising environment, the Internet is showing results that are downright enviable. Online advertising is in full expansion, and should represent close to 10 percent of the overall advertising monies spent in 2010. Luxury brands are now beginning to master this media: a few explanations follow.

In the United Kingdom, spending for advertising on the Internet is already greater than that allocated for magazines. It even represents more than a third of budgets going for television advertisements. Advertisers are investing more and more in Internet promotion. This is not limited to England, but is a global trend, and is happening in the majority of industrialized countries.

What is the reason for this boom? Broadband Internet connections are beginning to proliferate, with the result that people are spending more time surfing the web and less time on other forms of media.

In the luxury domain, a number of brands have already shown interest in this new media, which is changing the behaviour of their target audience. A few brands have even begun developing video advertising campaigns on websites that have a large following. A case in point is the example of what Fendi is doing on the website. It illustrates an innovative way to enrich the online experience for web users.


What are the targeted objectives of online advertisers? Exposure, of course, but quite probably, they are also interested in motivating the maximum number of prospective clients to go into the stores. There are many examples of online competitions and exclusive clubs set up to strengthen the brand experience while trying to create a loyal following. The Internet is evolving. Advertising formats that were too intrusive in the past are giving way to more subtle forms of advertisements that are placed at the heart of editorial content and in the field of vision of the web users.

The importance of targeting and reporting
Among the key motives for advertisers that use the web, two come up regularly: the precise targeting that Internet can offer; and the possibility of precisely measuring the results so that a campaign can be modified or improved en route, for example.

In terms of targeting, the Internet allows advertisers to display their advertisements on a highly visited site only during specific days of the week and even during certain specific times of the day. It thus becomes easy to reach groups of people when they are at work, or the targeted advertisements can be used to re-inforce the impact of an off-line media campaign when advertisements are placed in magazines or newspapers on the same days.
The targeting term ‘capping’ allows the advertiser to define the number of displays that are destined to each web user. Thus, he can decide to reduce his campaign in order to obtain the maximum number of clicks or, on the contrary, he can aggressively place advertisements to reach a restricted number of people. But, beware… it is necessary for the campaign to have a minimum budget in order to benefit from a sufficient share of voice (SOV). In the opposite case, it runs the risk of passing unnoticed with both its own public as with the collaborators of the company which advertises.
Optimising basic targeting techniques represents the essence of a successful e-advertising campaign, as does a preliminary analysis that will determine sufficient budget requirements.

Measuring the rate of return on investment
While exposure is often the ultimate goal of a traditional media campaign, marketers on the Internet are trying a new form of measurement: activity. There are many performance indicators that are available to advertisers for this type of measurement.
It is, of course, possible to know the number of ‘clicks’ recorded on each creative element of a campaign in order to determine which one was the most appealing to the targetted audience, but it is also possible to analyse the ‘post click’ behaviour, which means the arrival of prospects to the brand’s website. Did they look for a specific product, a specific colour, or any accessories, that would make them, in the end, go to the store?
There is valuable marketing information that can be collected and analysed with the help of a tool called ‘web analytics’. This is statistical analysis software that allows the user to decipher the behaviour of visitors to an Internet site. It is a definite pre-requisite to a marketer before launching into the realm of e-advertising.

A new media, without a new budget
The advertising director of an international brand, totally convinced of the necessity of being more visible on the Internet, recently told us, “the Internet is a new media, but without a new budget.” This is absolutely true. The web must be integrated into existing media plans. For these reasons, some advertisers consider this media as a particularly good support for covering markets that they are not currently in, or that they are not covering to a great extent with their classical media plan, or when they believe the price of other media is too high.
2007 should show an increase in online advertising expenditures. Europa Star and IC-Agency will continue this discussion with a more complete understanding of the best e-advertising campaigns soon.

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Source: Europa Star December-January 2007 Magazine Issue