E-COMMERCE

Learning Unit 4: ADVERTISING IN E-

C0MMERCE

OUTCOMES:

Understand the objectives of web advertising, its types and characteristics.

Describe and understand the major advertising methods used on the Web, including banners and chat rooms.

Describe various web advertisement strategies.

Describe various types of promotions on the Web.

Terminology in E-Advertising• Ad views: Number of times users call

up a page that has a banner on it during a specific time period.

• Button: A small banner that is linked to a website.

• Page: HTML document. • Click: A count made each time a

visitor clicks on an advertising banner to access the advertiser’s website

CPM (Cost per Thousand impressions): Fee an advertiser pays for every 1 000 times a page with a banner ad is viewed.

Hit: Request for data from a webpage or file. Visit: A series of requests during one (1)

navigation of a website; a pause of request for a certain length of time ends a visit.

Major Advertising Methods used on the Web

• Traditional mass media employs one-to-one communication

Firm Content Medium

• Interpersonal and computer- mediated communication permits interactive exchange between buyers and sellers

Firm Content Medium

• Internet permits many-to-many exchanges. It is cost effective and interactive exchanges

• Internet communication: Also known as hypermedia – network that links many parties, simultaneous communication with ease and speed

Types of online communication• Internet presence sites:

Provides information to customers on the products, services, hours of business, telephone numbers, etc

• Email: Companies send emails to customers to keep them informed. Unsolicited, unwanted mail is called spam

• Pop ups: Online adverts that appear on screen without the user requesting them.

• Banners: Small box like icons that display simple messages or logos. A banner is a hyperlink to a company.

• Viral marketing: Users of a product encourage their friends/ family to use it, by providing their details.

• Affiliate programs: Host site directs visitors to other related sites.

• Virtual stores: Designed to facilitate online trade. Includes shopping baskets and payment facilities.

Example of e-commerce ad

Advantages of Online Communication

Round the clock access to information on a 24/7 basis.

More relevant information and people are able to filter effectively.

Flexible and adaptable advertisements that can be revised easily.

Direct transactions whereby consumers have the opportunity to purchase immediately.

Production quality of online pictures can match the actual product.

Lack of familiarity leads to consumers finding online shopping a novelty.

Interactive communication whereby consumers can communication directly regardless of distance an time.

Flow and telepresence which absorb surfers in virtual reality.

Interactive communication Three (3) key dimensions of interactivity: Control: Users are in control of what they

navigate. Two way communication: Instant feedback is

possible on the Internet. Synchronicity: Refers to the instantaneous

communication between parties.

Effectiveness of Online Ads• Online advertising must be evaluated in terms of hard

and soft factors. • Example of a banner ad

Banner Advertising ProcessVisit website of Company A

Click to banner ad of company B

Visit company B website

Increase Interaction

Customer

Purchase

Stages for determining the effectiveness of banner advertisements:

Exposure: Number of people who see the banner.

Click-through: Number of people who click on the banner and view its website hyperlink.

Interaction: Length of time people spends on the site.

Outcome: Number of purchases made by people who clicked through

Web Promotional Strategies• Internet presence sites; • Interactive sites; • Customer service sites; • Distribution sites.

Example of Internet Presence Site

Branding on the WebA brand is a collection of attributes and associations that

represent the identity of the product or service offering.

Role of branding

Have clear customer promisesUnderstand its customersDecide on role that the Internet will play in

brand strategyEstablish brand awarenessDeliver consistent brand experienceIntegrate all experiences of the brand

Key success factors of online brand experience

User friendly site; Value added service; No technical glitches; Look of the site; Navigability of the site; The way customer service people respond; Speed of delivery; Ease of returns.

Does

following

website meet

requirements

Questions to ask about the nature of a product or service when selling

online

Is the service local or global? Is the service high-touch or low-touch? Is the service high in search qualities? Is the service high in experience

qualities? Is the service high in credence qualities?