Internet Advertising © 2001 Ann Schlosser, University of Washington Business School.
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Transcript of Internet Advertising © 2001 Ann Schlosser, University of Washington Business School.
Internet Advertising
© 2001 Ann Schlosser, University of Washington Business School
Agenda
• Permission marketing
• Yesmail.com
• Banner advertising
• Optimization
To Opt-In or Opt-Out
• Opt-in– Send messages only to those
who request them
– Default = not included in list
– Result: smaller lists (48.2% participate)
– Favored by consumers
– Risk missing new opportunities
– Policy employed by EU
• Opt-out– Send messages to people unless
they request NOT to get messages
– Default = included in list
– Result: larger lists (96.3% participate)
– Favored by firms
– Introduce to US Congress as baseline privacy law
“When I get a spam that only says ‘Click here to opt out,’ that really annoys me. That’s not permissions marketing.” – Seth Godin, author of Permission Marketing.
Dear cadrys,
Several times a month, eBay sends out valuable email communications with news, offers and special events that help you buy and sell. Unfortunately, we have noticed that an error occurred during your registration process that prevented you from receiving these communications. Many of your Notification Preference defaults were set to "no" rather than to "yes", which means that unlike other eBay members, you're not receiving these types of communications.
We'd like to resolve this problem quickly and efficiently. Therefore, on 1/8/01, we returned all your Notification Preferences to the standard default of "yes" to put you in line with the rest of the eBay community. However, we want you to choose your Notification Preferences rather than rely on our standard defaults and will therefore not include you in any communications until 1/23/01. This will provide you with some time to evaluate these choices and modify your Notification Preferences. You will, however, continue to receive certain administrative emails that are part of executing your eBay transactions.
eBay : Where "Opt-out" Means "Keep Trying"
Posted at http://slashdot.org/articles/01/01/09/1648257.shtml
Familiarity with E-Mail Marketing Models
Retention Acquisition
Member Registration
Customization and Testing
Business Process Rules
Proprietary Network, Partner Network or Hybrid?
Individual consumers
Partner websites
Clients
??Arguments based on:
•Economics
•Branding
•Data quality
Arguments for Proprietary Network
•Economics•Average case: Preferred to partner network if R > $6MM per month
•With 2 messages/week (each generating 25cents), need over 3 million members
•Optimistic case: Preferred to partner network if R > $4.16MM per month•With 8 messages/week (each generating 25cents), need over 520,000 members
•Branding•If defend consumers against marketing abuse, then serve consumers
•Data quality•Those registering at yesmail.com likely willing to provide rich data and are receptive to promotional emails
Individual consumers
Clients
Arguments for Partner Network
•Economics•Proprietary network: If spend $3MM on banner ads (CPM = $30 and CTR of 1%), grow by 1 million members per month•Partner network: With 80 partners, each with 25,000 new registrations per month with 50% opt-in, get 1 million members per month
•Branding•Associate with well-liked brand•Avoid mass advertising to drive traffic to yesmail.com
•Data quality•Quality data if users are involved in partners’ sites/brands•Where register is additional important data
Individual consumers
Clients
Partner sites
Member and Client Benefits
• Members– Valuable promotions
– Really avoiding spam?
• Clients– eTrack
– Flat rate of 25 cents per email
Attitudes toward Permission vs. Unsolicited E-mail
Future of Agents such as Yesmail?
• Potential pitfalls:– Trust– Demand– Feasibility
Yesmail Update
• Summer 2000: commit to using double opt-in to avoid appearing on Maps’ (Mail abuse prevention system LLC) list of spammers
Date Membership size
Average monthly growth
Partner Network size
May 2000 11 million 665,600 104
Feb 2001 14 million 1 million NA
Rich Media E-Mail Ad
Sent to 100,000 prospects using yesmail.com list
165,000 responses
Conversion Costs Across Medium
Death of Banner Ads?Paid vs. In-House Ads
Banner Ads
Full CRM = $28.28
Vertical banner CRM = $54.17
Half CRM =$26.51
Micro CRM = $16.94
New: Skyscraper
Greatest Difficulties in Adopting Online Advertising
4.0
2.93.4
3.93.3
4.2
2.5
3.4
0.0
1.0
2.0
3.0
4.0
5.0
Lack
of
Com
preh
ensi
veM
easu
rem
ent
Cos
t
Diff
icul
ty o
fTr
acki
ng
Low
Clic
k-Th
roug
h R
ate
Diff
icul
ty o
fB
uyin
g
Ban
ner
Siz
e
Low
Com
mis
sion
of
Med
ia B
uyin
g
Lack
of G
ood
Cre
ativ
e
Agency Grand Total
Greatest
Least
Average of responses on 5-point scale where 1 = least problematic and 5 = most problematic
Ad Strategy Across Industries
Branding
Behavior-based
Banner Ads Enhance Awareness and Image
B2B Advertising
Share of advertising impressions = 7%
Number of B2B advertisers making up 50% of online advertising = 18
Concentration of B2B Advertising and Work Users
Reaching Target Audience
Online Media Reveals Three Action Profiles
Qualified prospects
Traditional advertising targets a qualified audience
Online advertising targets readyand motivated consumers
All consumers All consumers
Ready
Motivated
Qualified prospects
Different Media Approaches for Different Profiles
Optimization
Sample Report from Ad Server Avenue A