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Online Advertising

Advertising is one of the firm’s most important functions because it is the driving force for sales and therefore brings in profit. Just a few years back, the world of advertising was not as complex as it is today. Ad-depended media including the television, the radio, the cinema, the newspapers, and providers of outdoor media were very efficient in driving sales. However, television and radio, what used to be the best media to advertise in, has become an ambient medium. Cinema viewing is also down and is said to be 25% of what it used to be. Even the readership of newspapers has declined and outdoor media has consistently been ignored mostly because of the clutter of advertisements already out there today. For all these reasons, mass media has become less and less massive.

The reason for this is, in most part, the emergence of the internet and what online users have made of it. The internet usage is said to be at considerably large annual growth anywhere in the world making it an extremely appealing channel for advertisers. Of course, turning into this channel is not as easy as placing traditional advertisements online. It also entails an understanding of what the internet user is today. Truly, internet users are now different consumers from the ones advertisers used to talk to via TV, radio, and print. What advertisers are faced with are more empowered consumers who have wide varieties of interests and have greater capabilities to be fully informed. Today’s consumers are also multi-taskers who have become more impatient and therefore harder to reach, attract, and engage.

Because of this, advertisers are still trying to catch up with the relatively new media that is the internet. Although we internet users can observe a number of viral ads that have become bolder and more daring in their approach, it seems this is not enough to get back the response advertisers used to have when traditional media began. However, in an attempt to make full use of the vast potential of the internet, firms have learned to use it as a tool to directly communicate with their customers and improve on their social networks. This has led to a whole new means to advertise in a more subtle and more personal way. Through this, e-CRM (Electronic Customer Relationship Marketing) also developed. e-CRM is a means by which firms use the internet to build stronger brand relationships with their customers by directly communicating with them and delivering delightful brand experiences at every interaction. Through this, firms are better able to win their customers’ loyalty which would result in the business’ long term profitability. One very good example of this is Starbucks Coffee and how it has actively participated in a customer-created online forum dedicated to its products and services. Because of the online forum, Starbucks can easily track what their most loyal customers are saying about the company and they can easily communicate with each other for improvement in products or services or and enhancement of their brand image.

In the end, advertisers are still faced with barriers to effectively communicating through this new channel. For one, apart from the fact that advertisers recognize that online consumers dislike interruption (therefore the obsolescence of pop-up ads), the new consumer is not as well-known as advertisers would like. Advertisers also have not mastered the new technology and have not developed a means to measure the effectiveness of the new media. Needless to say, firms seem to be on the right track as they constantly communicate with their customers. This not only leads to better delivery of goods and services and development of new products but also the generation of new insights that would lead to fresh ideas for advertising.
By: boredumb
Published: 04/16/08


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