Introduction to online advertising

transcript

Increasing Online Confidence

Understanding online media planning and buying

Alastair CartwrightJuly 2009

A bit about me• 11 years online experience

• Part of senior management team that launched a Guardian Media Group website into the market in 2000 – Workthing.com

• Founded Enhance Media in 2001 - Online recruitment communications agency

• First UK recruitment ad agency to be Google qualified

• Developed range of online courses which were accredited to BTEC level 2 standard

• Clients included PwC, T-Mobile, AXA Sunlife, Cap Gemini

• Sold Enhance Media in 2008, now working as a consultant to a number of technology companies

Agenda10.00am Introductions and day one objectives

10.15am The online advertising market

10.30am UK Online Adspend Study – IAB/PwC

11.00am Break – coffee

11.15am Different types of online advertising solutions

11.30am Understanding social media and how to develop attraction

strategies

12.15pm Basic Principles of online creative

12.45pm Recap and summary – unanswered questions

What do we want from today?

The online advertising market

Market background

and trends

Marketing budgets to hit new low in Q4 08

….And so it came to pass….

Markets in crisis

Disappeared from the High Street

Shoppers find convenience and value online

In uncertain times……

….when budgets are being slashed

…..Marketing has to be accountable

This is the first recession

since the internet has become a

mass medium……..

Accountability is Online’s trump card

32.3m34.68m

Jul-Dec 2007 Jul-Dec 2008

Number of internet users in the UK

Source: NRS UKOM: Jul-Dec 2008; Jul-Dec 2007

66%UK Pop

71%UK Pop

37%Online

44%Online

Internet users going online more than once a day

Number of people online

2 thirds of broadband services are now above 2 MB

0% 20% 40% 60% 80% 100%

Nov '06

Nov '07

Nov-08

< 2MB2 MB>2 MB

Base: All who know speed of broadband connection at home. Q: Do you know the connection speed of your home broadband package? (Nov 06; Nov 07; Nov 08)

Source: BMRB Internet Monitor Nov 2006; Nov 2007; Nov 2008

48% of home broadband users have used wireless broadband at home in the last month (Nov 2008)

Internet

Newspapers

Magazines

Weekdays

Saturdays Sundays

Source: BMRB Internet Monitor, November 2008 Base: All Internet users aged 15+

Online second only to TV - % of media time for all internet users

UK Online Adspend Study Results for the full year of 2008

Prepared by PricewaterhouseCoopers for the IAB

£3,349.7mmarket in 2008

An increase of £537.1m year-on-year

Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

17.1% increase

2008 vs. 2007

on a like for like basis

Online advertising reaches £846m in Q3

47.442.836.638.936.645.251.163.888.0105.2119.7

152.1171.8

303.5327.0

653.8680.6

724.1754.2

847.0822.7

846.1834.0

385.5456.0

‘01 ‘03‘02 ‘04 ‘05 ‘06 ‘07 ‘08

Online in context…

Breaking market trends in the UK ad industry

11.7% 5.1%

1.0%5.4%

TelevisionPress DisplayInternetPress ClassifiedDirect MailOutdoorDirectoriesRadioCinema

% share of revenues for January to December 2008

Total advertisingmarket

£17.5bn

2008 market share 19.2% (15.5% in 2007)

IAB estimates for actual ad spend by format are based on samples of categorised revenue from key IAB members provided by PwC. Data excludes unclassified figures.

-7.0%-4.4% -3.8%

-17.3%

-6.0%-6.3%-6.7%

PressClassified

Directories PressDisplay

Radio Direct Mail TV Outdoor Cinema Internet

Source: PricewaterhouseCoopers / Internet Advertising Bureau, The Advertising Association / WARC: WARC estimate for directories.

Online only medium showing growth in 2008

Total advertising market growth = -3.5%

Year on year growth for 2008

Online’s share growth accelerates to 20%

Source: PricewaterhouseCoopers / Advertising Association / Internet Advertising Bureau / WARC

2.5% 3.3% 4.2%5.5%

7.3%8.4%

10.4%12.4%

18.6%19.8%

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Summary – Full year 2008• Online advertising is the only medium showing growth

in 2008

• Internet advertising reaches £3,349.7m in 2008

• Online achieved a share of 19.2%, up nearly 4 points from 2007 (15.5%)

• The market grew on a like for like basis by 17.1% year-on-year, still maintaining strong growth

• Online now on a level pegging with Press Display

The digital media mix

The developing mix of ad products

Display

Classifieds

Paid for search

Solus Email

Full year total£3,349.7m

% share of revenues for the full year 2008

335.9 262.2

453.7 379.0

1165.6

592.0 585.3

1619.1

637.4 715.2

1986.9

Display Classifieds Paid for search

2005 2006 2007 2008

+7.7% +22.2%

+22.7%

All online formats are still experiencing growth

The digital media mix£

1986.91619.1

Solus Email

Interruptive formats

Other display

Tenancies

Display ads on email

Sponsorships

Recruitment classifieds

Further classifieds

Banners / Embedded

Paid-for search listings

Year on year comparison

Classifieds led by key players

2% Banners / Embedded

Sponsorships

Interruptive formats

Display ads on email

Tenancies

Pre-post roll

Display affiliate

Other display

The display digital media mix

Full year display total£637.4m

% share of display revenues for the full year 2008

£495.8m

£11.8m

£15.5m

£13.0m

£11.7m

£52.4m

£12.7m

£24.5m

44% of gross display spend through networks

The online agency landscape

Introduction • The definitions of trading online and engaging key

audiences online are blurring and the leading companies are now looking at digital in totality and implementing numerous fully tracked initiatives to achieve a range of KPI's.

• The following sections touch upon the majority of areas which need to be considered when using the digital medium

Agency roles

• Generally a brand entering the digital space will require two different agency capabilities; a digital media agency and a creative agency.

• Most digital media agencies will offer creative but many brands prefer to keep them separate. The reason for this can range from pure creative houses being more creative, existing relationships, costs and not putting all eggs in one basket etc.

KPI's • KPI's for digital direct response marketing should be

ROI but can also include such things such as e-mail addresses collected / registrations.

• KPI's for digital brand marketing should reflect the ambitions of the brand such as dwell time on site, reach of a brand messages, weighted scores for visiting different areas of the site, repeat user acquisition etc.

• Each business generally has different ambitions and with comprehensive tracking all KPI's can be measured against.

Media agency

• Media agencies are generally responsible for all paid for media excluding affiliate marketing.

• Roles covered will be planning and buying online media and search, full responsibility for tracking and reporting, creative asset coordination, forecasting and updating the client on key digital developments.

• Naturally these responsibilities can be broadened or reduced but the above is generally considered a bare minimum.

Creative agency

Creative • Creative agencies must be renowned for their

creativity, but also taking into account the need for a direct response message – results!

• With digital being a medium for both direct response and branding it is key to find a relationship between the two and measure both with different KPI's.

Direct response creative • Direct response creative tends to be placed on cheaper

high reach less targeted sites on a CPC or CPA basis.

• The creative needs to on the whole be commerce led with a strong brand presence.

• Creative placements tend to be standard without the use of rich media (i.e. overlays etc).

• DR campaigns are generally measured on pure return on investment i.e. the cost of the media (including agencies, tracking etc) versus the direct financial return (could include life time user value when known).

Brand led creative • Brand led creative is generally a richer creative execution

and may involve the use of rich media and highly targeted media placements.

• The media value of highly targeted placements is traditionally higher in cost and is normally charged on a CPM basis.

• Brand creative on the whole is not about driving sales but changing the consumers views of the brand / products.

• KPI's can range and various digital brand measurement tools such as Dynamic Logic are available to track progress.

The digital media armoury

How to buy online media

Digital media is traditionally purchased via the following mechanics:

1. CPM - Cost per mille (1000) - High risk often mechanic for prime inventory

2. CPC - Cost per click - Favourable but still element of risk

3. CPA - Cost per acquisition - Most favourable

Portals

Definition: Web sites that feature numerous content categories and receive a high volume of web traffic

Social media

Definition: A social structure made of nodes (which are generally individuals or organizations) that are tied by one or more specific types of interdependency

Verticals

Definition: Web media that is focused on a specific area of content or targeted at a specific audience

Networks

Definition: Companies that aggregate ad inventory from hundreds of websites of various content categories

Affiliate Networks

Definition: Companies that provide a third party solution for advertisers to form relationships with thousands of smaller websites

Key display media channels

Typically the largest potential reach in the market

Availability of inventory creates opportunity for higher volume, but lower conversion rates due to competing advertising and a less qualified audience

Requires constant testing and optimisation

Expensive - requires significant investment to generate results

Traditionally bought on a CPM with a CPC element

Every portal performs differently by market

Your advert

Your advert Portals

Enormous reach and easy to implement.

Can be bought on CPC or free for Twitter

Engagement to advertising is very low and risks of poor brand exposure are very high

If mastered sales can be grown to unprecedented levels

Sites can be teen focused which can lead to small basket sizes

Your advert

Your advertSocial Media

Typically very expensive. High CPM rates

Smaller audience, even though more targeted cannot generate volume efficiently

More difficult to work with publishers as they tend to be less sophisticated

Verticals

Provides enormous reach with only one agreement

Requires a great deal of testing and is difficult to optimize, since you do not know on what sites your media is placed (media is purchased by category)

Inconsistent performance which depends on network, inventory availability and available creative sizes

Upon CPC test CPA agreements can be reached which is mutually rewarding for all parties

Networks

Very favorable as able to drive cost efficient volume which is paid on CPA

Requires full-time person devoted to managing affiliate relationships

Slight lack of brand control

Provides continual advertising presence at no cost

One of the most effective ways to trade online as brand reaches sites which could not profitably be worked with

Affiliate marketing

Different display advertising formats

Skyscraper - http://creativezone.eyeblaster.com/#ItemName=Skoda%20Eat%20My%20Hat%20Skyscraper

Commercial break - http://creativezone.eyeblaster.com/#ItemName=Coke%20Video%20Wall

Wallpaper - http://creativezone.eyeblaster.com/#ItemName=Barclay%20card%20skin

Peel back - http://creativezone.eyeblaster.com/#ItemName=McDonald's

Homepage takeover - http://creativezone.eyeblaster.com/#ItemName=Harry%20Potter%20Skin

Floating expandable – http://creativezone.eyeblaster.com/#ItemName=Holden%20Colorado%20

Widgets - http://creativezone.eyeblaster.com/#ItemName=Will%20Young%20Widget%20Ad

Overlay - http://creativezone.eyeblaster.com/#ItemName=Standard%20Life%20Investments

Shared ads - http://creativezone.eyeblaster.com/#ItemName=Bruno%20Messenger%20Shared%20Ad

Search

Click trends

• Users generally click on the top organic listings and the top of the paid listings.

Search Categories

Paid search • Search is paid for via a bidding platform, each search

term is bid against and when the terms are clicked these monies are owed to search supplier.

• The brand led search terms should be tracked and measured against the defined KPI's and optimised accordingly.

• The direct response search terms should be measured against return on investment i.e. are the sales paying for the search activity (life time value should be considered).

• Paid search can be launched in a matter of hours and changes can be made in real time.

May 2009 Account activity

Spend £3,728

Click Thrus 6,442

Cost Per Click £0.58

Applications 1,001

Cost per Application £3.700

Conversion Rate 16.6%

Organic search • There are a variety of ways to optimise copy

and content to improve listings.

• Natural search optimisation is a lengthy process and should be treated as a separate project.

Organic search • Seven keys factors:

1. Page submission – submit your pages to search engines2. Design – easy to find, read and navigate3. Title tags – appropriate page title4. Body text – healthy amount with high keyword density5. Anchor text – use text links for navigation6. Fresh content – great for Google, e.g. blogs7. Link building – high quality external links to your

website

Social networking sites

Facebook

• Facebook– 42,000 joined on Saturday January 3rd – Bigger than Google, 9.8 billion page views per

month– More time than AOL + Yahoo! + MSN– “When I Was Your Age, Pluto Was a Planet.”-

1,521,083 members– "If this group reaches 100,000 my girlfriend will

have a threesome.“

• Create ad• View Neilson Facebook page

How to set up a Twitter accountStep 1: Go to http://twitter.com.Step 2: Click the Join the conversation! Green BoxStep 3: Create a Username.I’d recommend using your domain name

(ie. http://twitter.com/killercreative ) If it’s just for fun or personal use, use whatever you want as the username.

Step 4: Start connecting!

For more information on this check out –http://www.twitip.com/how-to-set-up-a-twitter-account/

Businesses using Twitter

1. Dell has created a number of Twitter profiles, (e.g. DellOutlet posts recent refurbished Dell computer offers).

2. Starbucks posts new offers and also participates in threaded discussions of these offers with their Twitter-followers.

3. Whole Foods Market asks what their clients like to read and watch, recommends new food podcasts and invites them to the company upcoming events.

Businesses uses for Twitter• Marketing tool: Businesses are using Twitter as a marketing

or public relations channel by connecting with customers directly.

• Building reputations: Twitter is being used by workers to improve their personal reputations, thereby enhancing the company's reputation.

• Sharing experience: Staff are sharing information about what they are doing so they can help each other with ideas.

• Information gathering: Twitter is being used to gather information about what customers, competitors and others are saying about a company.

Basic principles of online creative

Online display advertisingMisconceptions about display

• Firstly, that online is a restrictive space allowing for little creativity.

• Second, that internet display advertising should be interruptive - consumers will never notice you unless you get in their way.

• Finally, online is all about direct response because it’s the most measureable, accountable medium that can facilitate sales from the initial point of consumer interest.

Online display advertisingAs well as encouraging “click to buy” online display has a number of other roles:1.Raising awareness2.Entertainment3.Evoking an emotional response4.Integrating and extending the brand5.Driving online PR and embracing the social element of the web

Raising awareness• http://www.thegrandunion.com/coi_14/beergogglesgirl/insitu.html• http://www.thegrandunion.com/coi_14/beergogglesboy/insitu.html

Entertainmenthttp://portfolio.london.agency.com/clients/ikea/kitchens/index_01.html

Evoking an emotional responsehttps://www.armyjobs.mod.uk/StartThinkingSoldier/Pages/Default.aspx#

Driving online PR and embracing the social element of the web

http://www.aislondon.com/indigo/

And finally

The most creative website ever?...

Thank you – Any questions

Alastair Cartwrightalastair.cartwright@gmail.com07866 682790

http://www.linkedin.com/in/alastaircartwrighthttp://twitter.com/alcartwright