The Role of Advertising in Internet Marketing
1. Introduction and Background
The years succeeding the dotcom crisis have been distinguished by a phenomenal enhancement in the global spread and utilisation of the internet. Aided by an amazing expansion in the World Wide Web, the Internet revolution has swiftly and extensively changed the strategic orientation and development of major as well as minor business firms in both the industrialised and the developing economies.
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The remarkable accomplishments of online businesses like Play.com, EBay and Amazon.com illustrate the rising import of this business conduit. Augmentation in the management of the Internet, sharp technological advances, and greater progression in Internet marketing methods and skills are steadily overcoming commonly held reservations about online misuse of data and credit cards. The spread of broadband and wireless technology has also been instrumental in greater use of the online medium for commercial transactions, for purposes and buying and selling, in the advanced nations. The increasing proliferation of PCs and laptops, along with progressively simpler user technology, is leading to the emergence of new segments, especially among women and older individuals, who are able to surf through millions of choices and take pleasure in the comfort and ease of home shopping. Internet retail sales in the advanced countries have shot up sharply during the course of this decade.
Whilst companies like Amazon.com and EBay and Amazon.com led the way in Internet marketing, the online world is now seeing the market jostling with hundreds of thousands of diverse companies who are exploiting the power of the net to convey their messages and market their goods in far and near locations.
The Internet is one of the most important marketplaces of modern day business; with online managers busy optimising their marketing mix, creating niches, generating brand value and satisfying online customers. Marketing stratagems have rapidly become extremely intricate and multifaceted, experts using their online presence with a planned mix of acuity, flair and sharp technical expertise to attract visitors and draw them into trying and purchasing products. (Harris & Dennis, 2002)
Introducing innumerable avenues of opportunity and nurturing competition, the online space continues to be affected by far reaching change in the ways and means adopted by managers to market their products and services.
The enormous clutter evidenced in the marketing space calls for the adoption of carefully thought out advertising strategies for successful online marketing. With there being a wide variety of options for online marketers to convey their messages to their target market, the choice of appropriate online advertising strategy will undoubtedly play a major role in optimising the marketing mix and ensuring marketing success.
2. Aims and Objectives
The Aims and Objectives of the research proposal are set out as under:
Aim: To investigate the effectiveness of advertising in online marketing.
1. To investigate the role of advertising in online marketing.
2. To investigate the benefits and shortcomings of various advertising options available on the Internet.
3. To ascertain the method for designing a suitable Internet advertising plan.
3. Literature Review
a. Online Advertising and its Role in Marketing Strategy
Reaching the website advertising message to current and potential customers through effective online advertising techniques is considered to be one of the most important tasks of online marketing (Harris & Dennis, 2003).
The adopted online marketing strategy should enable the organisation to target its market in a measurable and definitive manner and position the business in such a way that people looking for its services can find them easily (Steinbock, 2000)
It also needs to be understood at this stage that whilst it is not difficult for companies to drive existing customers to websites through a mix of targeted emails, direct mailers and telemarketing, the task becomes far more challenging when businesses wish to draw the attention of new clients to their web messages (Harris & Dennis, 2003).
b. Online Advertising Strategy
It is important to stress, whilst initiating a discussion on online advertising to note that whereas internet marketing is usually associated with cheap costs and good Return on Investment (ROI), inappropriate advertising decisions can lead to low site hits, meagre business, and, (apart from disenchantment with the marketing channel), underutilisation of time, effort and money (Harris & Dennis, 2003).
Internet advertising starts with proper service definition, it being widely accepted that (a) absence of clarity in definition of service and in detailing of specific benefits provided to clients, or (b) fuzziness about the target market can well undo brilliant design and dazzling graphics (Collins, 2000). The contents of a website, especially with regard to testimonials and other indicators of service expertise, play a major role in attracting prospective clients (Collins, 2000).
Whilst much of internet marketing focuses on the most appropriate way of conveying organisational marketing messages to its target market, the final effectiveness of internet marketing strategy, especially its success in converting hits on websites to actual enquiries and sales, also depends significantly upon the content, design, and user friendliness of organisational websites (Collins, 2000). Apart from such fundamental objectives, websites need to be expertly prepared to facilitate client-organisation interaction and encourage discussion and idea exchange (Collins, 2000).
With organisational websites acting both as carriers of advertising/information messages and as facilitators of interaction between clients and service providers, online advertising works at delivering web advertising messages to vast numbers of potential customers through two distinct channels; search engine optimisation and paid advertising (Harris & Dennis, 2003).
c. Search Engine Optimisation
Search engines, because of their critical role in taking internet searchers to their desired information destinations on the World Wide Web, play a pivotal role in formulation of online advertising strategy and have become integral to the marketing mix. .
Optimum effectiveness of search engine usage is achieved through the adoption of search engine optimisation (SEO) techniques, an assortment of complex and ever changing methods that deal with (a) determination of nature of search for the product or service (generic, brand, service, or locality), (b) usage of relevant keywords in the website text, (c) site commands and (d) basic site content (Plummer & Others, 2007). With search engines like Google, Yahoo and MSN using robot like crawlers/spiders to locate web pages, (via algorithmic processes), effective SEO techniques enable organisations to climb up the hierarchy of listings in these engines and attract user attention (Plummer & Others, 2007).
The core configuration of the website needs to be worked upon by companies at the time of website design to optimise search engine compatibility and minimise costs of website reconstruction, which could otherwise occur later. Adding to the complexity of search engine optimisation is the constant change and evolution in the usage of algorithms by search engines (Janoschka, 2004). With many search engines now incorporating an array of factors, both hidden and disclosed, to protect against overly aggressive and unethical link manipulation, (Google, for example, supposedly ranks sites through approximately 200 different indicators (Plummer & Others, 2007), search engine optimisation is becoming an increasingly demanding task and the company should contract this job to an experienced and competent SEO company.
Online advertising strategies require businesses to register their websites with chosen directories and search engines (Plummer & Others, 2007). Despite some experts recommending the comprehensive optimisation of a site before its submission for registration, it is also widely accepted that search engine optimisation tends to be an ongoing process and is difficult to achieve in one attempt (Plummer & Others, 2007).
Directory registration, which needs to occur before registering of websites with search engines, comprises of two steps, the choosing of directories most likely to drive site traffic, and the subsequent registration of the website with such directories. This is a simple task that can be done by the firm on its own or through various companies that offer such services (Plummer & Others, 2007).
Despite there being an extensive choice of available directories, some of them (like Yahoo! Directory, Alexa Directory, About.com, ODP and AOL Search) are more likely to drive website business than others. Registration of directories needs to be followed by search engine registration. The table provided below gives information about the traffic achieved by the major search engines in 2008. (Pollock, 2008)
Millions of Viewers
Apart from registering of websites with important search engines, it is important to draw the attention of the advertising message of the company to the notice of users, as and when they search for their requirements. Such objectives are facilitated through two channels, namely (a) the use of links and (b) paid advertising.
Site designers drive online traffic towards their websites through usage of links from other sites with associated or complementary content and/or offerings (Harris & Dennis, 2002). Organising these links (at the time of website design) is important for the company because they can (a) draw the attention of people who visit such sites, (b) play an important role in creating awareness and (c) increase the chances of site traffic. The fact that these links are viewed by people who visit sites with similar or allied products or services, and consequently have greater seriousness of intent than casual visitors, also increases the chances of conversion.
d. Paid Online Advertising
Online advertising strategies need to account for the fact that (a) search engine rankings, (by and large), tend to move up slowly and that (b) link led response is finally dependent upon the popularity and traffic of other websites.
Paid online advertising options provide businesses with the means to achieve prominence in different search engines without having to wait for the results of search engine optimisation. Advertising tools like Cost per Click options provide search engine exposure against word combinations through a process of bidding against other companies, (which again are interested in the same word combinations for positions on the search engine) (Dholakia & Others, 2002).
In CPC, also known as Pay per Click, advertising, businesses pay to be placed under appropriate listings in a chosen category, their position on the list being determined through competitive payment bids for each actual click on listings that are linked to their organisational websites (Dholakia & Others, 2002). In Google Adwords, for instance, this takes place on the right hand side of Google pages.
Making optimum use of Google Adwords is a complex process and needs to be handled with care; with attention being provided to extant Google rules and practices (Plummer & Others, 2007). Although the selection of search engine/s for pay per click advertising could depend upon local preferences, the overwhelming lead of Google over its competitors (see table on page 2) makes the choice simple. Again whilst Yahoo offers the same sort of pay per click advertising options, preferring to call such entries as sponsored listings, its viewership is far lesser than that of Google.
CPC advertising is becoming increasingly popular and more expensive and whilst it offers a sure route to get noticed in the enormous clutter that exists on the web, clicks need not necessarily translate into customer queries (Dholakia & Others, 2002). Clicks are free in the hands of searchers and could take place out of misinformation or lack of understanding (Powell, 2003). Such listings could even become financial liabilities if clicked indiscriminately by pranksters or competitors. Inward traffic thus needs to be analysed regularly through the use of web metrics. Known also as site statistics, usage of metrics helps in analysing customer behaviour by providing information on the origin of visitors, usage of keywords, navigation processes, click paths from a page, most popular links, and conversions, thus allowing companies to fine-tune their web offerings, modify their CPC strategy and improve the effectiveness of online advertising (Dholakia & Others, 2002).
Apart from using search engine listings, web advertisers place ads of various kinds, e.g. floating, pop-ups, and the like in popular websites (like those of news channels) to attract eyeballs. Such options are however more suited for products and services aimed at large population segments (e.g. automobiles or insurance) and would be too expensive for small companies with geographically restricted operations.
Lastly, the creation of an e-mailing list of existing clients and its use to drive referrals to the website through promotional and gift/reward schemes could be immensely helpful, and lead to cascading enquiries from local residents. Site visitors are for this purpose encouraged to join mailing lists with offers of something of value (e-zines/ audio downloads) related to the offered service.
4. Research Design
The finalisation of research methodology and design depends primarily upon the nature of the research project, and its aims and objectives. With research methodologies, by and large, being either quantitative or qualitative in nature, the subject and character of the research assignment plays a major role in design of research procedure (Darlington & Scott, 2002).
Quantitative methods are commonly adopted when the research assignment involves the objective investigation of behaviours of large populations in order to arrive at generalisable statements (Darlington & Scott, 2002). They involve the utilisation of structured questionnaires, large numbers of surveyors, and the use of sophisticated sampling techniques (Darlington & Scott, 2002). Researchers are expected to be neutral and impartial observers who are uninvolved in the subject under study (Darlington & Scott, 2002).
Qualitative methods on the other hand are used when topics of research have an element of subjectivity that can not be met through the utilisation of purely objective quantitative techniques (Darlington & Scott, 2002). Used for assignments that need answers to questions that involve “what”, “how” and “why” elements, quantitative techniques use 121 and focus group interviews, which are often extensive and involve open ended and close ended questions (Darlington & Scott, 2002). Researchers, especially interviewers, need to be skilled in their task for the success of qualitative methods (Darlington & Scott, 2002).
The research topic dealing with an issue that is more suitable for subjective and interpretive research, it is proposed to adopt the qualitative method of research for conducting the research assignment.
Apart from deciding upon the basic methodology, research design involves decisions regarding sources of information. Information for the purposes of research involves primary and secondary data, primary data relating to data collected directly from organisations or individuals through information provided through organisational websites, reliable media interviews or through conducted surveys and interviews, and secondary data referring to the information related to the subject under discussion in the public domain (Darlington & Scott, 2002).
It is proposed, for the purpose of this research study, to access both primary and secondary data. Taking up the issue of secondary data, the attached bibliography contains details of information sources already collected for the purpose of this proposal. It is proposed to access as much relevant information possible both in hard and electronic form. With online advertising being topical in nature, substantial information is available on the subject from various paid and free internet sources and it is proposed to make best use of the same.
Apart from detailed study of secondary sources, it is also proposed to study the websites of at least three organisations in different industries to ascertain their advertising strategy and conduct detailed structured 121 interviews with two experienced marketing professionals to obtain their inputs on Internet advertising.
Information obtained from secondary sources, which will form part of the literature review, will then be analysed and validated with collected primary information to arrive at the final findings and conclusions of the study.
The schedule for completion of the study is provided below.
Details of Activity
Sourcing of Secondary Information Sources for Lit Review
Accessing data from Secondary Information Sources
Analysis of Secondary Information and preparation of Literature Review
Obtaining Material from Websites
Construction of Interview Questions
Fixing Interview Appointments
Analysis of data obtained from websites and interviews
Preparation of Study
Revision and Submission
6. Resource Utilisation
The resources needed for the successful conduct of the dissertation are by and large manageable. With the subject being widely written about it will not be difficult to obtain enough secondary information on the subject. The websites proposed to be studied for purposes of analysing advertising strategy have already been identified. A certain amount of time may be needed for locating suitable respondents for the interviews and in taking appointments, considering the ongoing economic crisis, but the researcher is confident of arranging for them. The availability of suitable authorisation from the institution will help in this purpose.
The assignment should take six months to complete and whilst finances are not expected to be a constraining factor, finances may be needed for short time subscriptions to a few good online libraries and databases.
7. Ethical Considerations
It is proposed to follow the ethical requirements of the sponsoring institution in letter and spirit.
The researcher has zero tolerance towards plagiarism and all sources used will be acknowledged appropriately.
Interviewees will be informed in detail about the purposes of research, and their permission for the interview obtained in writing.
Confidentiality of interviewee identity will be maintained, if requested.
Collin, S. (2000). E-Marketing, New York: Wiley
Darlington, Y., & Scott, D., 2002, Qualitative Research in Practice : Stories from the Field /. Crows Nest, N.S.W.: Allen & Unwin.
Dholakia, N., Fritz, W., Dholakia, R. R., & Mundorf, N, (2002). Global E-Commerce and Online Marketing: Watching the Evolution. Westport, CT: Quorum Books
Harris, L., & Dennis, C. (2002), Marketing the E-Business. London: Routledge
Koch, T. (1996), The Message Is the Medium: Online All the Time for Everyone. Westport, CT: Praeger Publishers
Plummer, J.T, Plummer, J, Rappaport, S, Hall, T and Barocci, R, (2007), The Online Advertising Playbook: Proven Strategies and Tested Tactics from the Advertising Research Foundation, John Wiley and Sons