Mark S. Pendolino

  INTERACTIVE MEDIA aND MARKETING

 

  The Resurgence of Online Advertising  

Introduction

Interactive Media as a Marketing Tool

Definitions

Resurgence of Online Advertising

Interactive Media's Effectiveness in Advertising

Burger King's Interactive

McLuhan and Marketing

Future of Interactive Media and Marketing

References

 

 

 

Increase in Bandwidth, Internet Audience Generates Gold Rush

Interactive advertising was originally pushed and touted as the new savior of advertising back before September 11th, before the dot.com bust, before everyone in marketing and advertising became extremely scared of the Internet and its volatility. It would be the new venue in which to expand, in which to reach the consumer - through targeted, one-on-one conversations. But the bomb did drop, and so did Internet advertising revenue.

But in 2003, advertisers began to feel out the hope of reaching back out through this new medium. Despite the hard times, the Web continued to grow and expand. The technology got better and better, and the (perceived) tipping point of about 60% of Americans now had access to the Internet at home. This was all good news, and the bandwagon rolled again.

 

Hope in the Hard Times

Nearing the end of 2004, online advertising revenue has exceeded all expectations. Predictions made by prognosticators last year forecasted a gain of about 6.1%, at September it was 14.6%, and by year-end it may even increase further (Taylor 2004).

Measurement tools have improved, search technologies have become more sophisticated and consumer targeting has become quite precise. An even bigger key is the increase in bandwidth. Broadband penetration is on the rise and faster connections allow advertisers to engage users in a way that dial-up Internet never could (Taylor 2004).

According to an influential study conducted by PriceWaterhouseCoopers (PwC) - an industry-focused analyst and consultant group - and sponsored by the Interactive Advertising Bureau (IAB) - an association dedicated to helping online, Interactive broadcasting, email, wireless and Interactive television media companies increase their revenues - advertising sales revenues have risen almost 50% from the 2nd quarter of 2003 to the 2nd quarter of 2004.

And PwC predicts even further growth, stating that they expect broadband penetration to almost double to 54 million by 2008 (Taylor 2004).


 


The Advertising Numbers

PwC's study yielded some surprising numbers, signaling hope among advertisers and marketers that interactivity and the Web will become a fruitful home for their message. Some of these findings include:

  • $2.37 billion in online ad sales revenues for the 2nd quarter of 2004
  • 7th consecutive quarterly revenue increase since the fourth quarter of 2002
  • 3rd consecutive record-setting quarter of growth.

IAB president-CBO Greg Stuart said that Internet advertising has now exceeded the boom period of the late 1990s, achieving three straight record-setting quarters (Maddox 2004).

"Marketers have figured out that online advertising is often the most cost-effective medium for influencing both branding and sales results," Stuart said in an interview with BtoB magazine.

 

MORE >>

 

The Interactive Advertising Bureau's Contracted Study on Internet Advertising Revenue (2nd Qtr, 2004)