Tidbits from Internet Advertising World 2004

After having recently attended the Internet Advertising World conference, we thought it best to share some of the best nuggets of information we received. The good news conference organizers wanted everyone to know is that there was a 40% (!) growth in online advertising over the last 3 quarters, representing a total of $4.6 BILLION spent online –WOO-HA!! Even brand advertisers are spending more, as they try to go where their consumers spend their time (McDonald’s is now spending 10x more online than they were two years ago).

In fact, some of the best take away tips came from the advertisers themselves who shared their successes and their plans. Here are the goods:

Pay-Per-Click (PPC) Keyword Advertising

Pharmaceutical manufacturer, AstraZeneca (AZ):

• There is a high corollation between brand equity and being at the top of both the natural search engine results and the PPC list. AZ’s goal is to be #1 in both and always above the fold on the first page.
• Even with hundreds of keywords, only top 15 will drive 90% of traffic (clicks), though by adding secondary keywords AZ’s traffic increased by 15%
• Test Content Match contextual advertising (it added 40% more traffic to AZ’s campaign)
• Group keywords by categories for tracking, testing and organizational purposes
• Rotate your PPC creative frequently, running different creative in different keyword categories
• Use the words “Official Site” in your PPC title line if you own the brand
• Use Google’s Negative Match to filter out terms you don’t want your ad served next to
• Use different URLs that direct to the main site, depending upon the keyword
• Work on conversions. AZ’s Purple Pill site converts ~50% of its search visitors into registered users!

Credit Card Issuer, JP Morgan Chase (JPMC):

• Search is 25% of their top spends online (others include affiliate marketing and online advertising) — online is chipping away at JPMC’s off-line advertising spends
• Use search as your testing ground for everything from new offers to new products
• Use the search keyword(s) in your title line
• If a word or ad copy works for one keyword, swap it into the other keyword ads and see if it lifts the ad’s performance
• Test alternative landing pages
• Use geo-targeting if geographical markets matter to you
• Organize keywords by frequency of search to better manage your costs
• Work on ways to merge off-line conversions with keyword performance

Fairmont Hotel:

If you can negotiate a performance-based compensation program with your search marketing service provider, you can avoid having the cost of search marketing hit your marketing budget (hits the operations budget instead) and then you have more money for other marketing initiatives.

Strategy

Procter & Gamble, the world’s largest advertiser may be setting the pace for other monster advertisers as it has changed the way it thinks about advertising. Instead of beginning with the creative process as they had in the past (”Picture this ad…”), they’re now beginning with strategy and the media (”Where do our customers spend the most time and how can we best connect with them?”)

Conference keynote speaker, Jack Trout, said “Strategy is THE most important thing in business today” and is the reason why so many of the mega-corporations are having problems in today’s environment — they’re implementing “bad strategy in an increasingly unforgiving and competitive world.” It’s all about the consumer’s *perception* of who you are or what you do.

He talks about seven points of differentiation from among which you should base and build your strategy:

1. Attribute - be what your competitor is not
2. Made How - e.g. Papa John’s Pizza — It’s the Sauce
3. Be First - e.g. Dom Perignon = the first champagne
4. The Latest - e.g. Advil - “Advanced Medicine for Pain”
5. Leadership - people like to associate with success and status
6. Heritage - play upon your history and longevity
7. Specialization - people are impressed by specialists and disbelieving that one company can do it all really well

Behavioral Targeting

Behavorial targeting is about effective reach and supplementing contextual advertising. This difference between behavioral targeting and contextual advertising is that behavior targeting delivers advertising based on the USER whereas contextual advertising delivers ads based on the CONTENT. For example, Cheap Tickets ran a behavioral campaign in which U.S. visitors researching travel to far away destinations were served ads for Australia, it helped increase bookings for tickets to Australia. For direct response marketers in particular, behavioral targeting performed far superior to run-of-site (ROS) ad buys, and therefore, behavioral targeting costs more than ROS buys…but still less than premium ad placements (e.g. home page or main section page buys).

Issues to Tackle in 2005

• Privacy and Security: consumers know and worry about things such as spyware and spam. How to assure them that your campaign won’t negatively affect their computer experience?
• Measuring: not only measure direct impact (e.g. impressions, clicks, etc.) but “output measurements” (side benefits) need to be tracked and trended too
• Advancing Technologies: accommodating customization and innovations with scalability, sustainability and cost justification
• Standardization of Ad Units (and the whole media buying, serving, tracking, reporting and auditing process)
• Educating Advertisers of Online Advertising Complexities
• Microsoft’s plans for MSN Search and how divesting itself from the other search engines will affect search marketing
• Pop-Ups: Annoy consumers — eliminate altogether or retain?
• Improving & Capitalizing Upon Behavioral Targeting: campaigns that now allow for audience-centric ad capping vs. general capping or agency-defined capping

What do you see as online advertising issues in 2005? Email us and share your thoughts: service@webadvantage.net

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