Web Advertising

Web Advertising annon Web advertising, not to mention the Internet itself, finds itself in a stage of relative infancy and therefore provides marketers with novel challenges and situations which need to be dealt with caution . The realm of Web advertising is unchartered terri tory! In terms of South Africa, the country finds itsef somewhat behind technologically. However, this may not prove to be a disadvantage as the uncertain nature of Web advertising may make a policy of ‘watching and learning’ most viable. What implications will this new technology have for marketing? What is the nature of Web advertising? How can a business use the medium effectively? Where is all this going ? These questions appear to be most pertinent in the process of understanding interact ive marketing on the Internet. The qualified opinion of John Matthee, a Web site designer employed by Adept Internet (an Internet service provider), was sought in accumulation of a large sum of the following data. This seems appropriate as the novelty of Web advertising at this stage h as led to generral lack of academic data in the practicalities of advertising via this medium.

2) THE INTERNET: AN INTRODUCTION 2.1) Original development of the Internet What was originally created by the US military to provide a secure means of communication in case of nuclear war, which has now become known as the Internet, has metamorphosed into the strategic global communications tool of our era. The end of the cold w ar left this massive installed structure – initially dubbed ARPANET- without much of a purpose. Soon universities, major corporations and governments began to piggyback on to the global framework, extending its reach and commercialising it. Known as the N et to aficionados, the Availability of cheap, accessible and easy-to-use Net access points throughout the world has seen the number of global Internet users increase dramatically each month. While the convenience of electronic mail was initial catalyst for Internet growth world wide, it’s the emergence of the World Wide Web (WWW) multimedia interface that has captured the attention of prospective users across the globe.

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The resources available on the WWW are as varied as they are extensive. There hundreds of thousands of sites which can be broadly categorised under topics such as sport, entertainment, finance and many more (Perlman, 1996). 2.2) Development of Internet in South Africa Perlman (1996, p 29) ventured that ‘South Africa is major global Internet player. It currently rates in the top 15 in the world terms of Internet growth rates.’ Local user numbers are certainly fueled by universities, companies and schools. The genesis of South Africa’s rapid Internet growth seems to stem from UniNet, the Internet service offered to the countries major tertiary institutions and steered from Rhod es University.

This explains the phenomenon whereby the majority of local Internet entrepreneurs – many of them are under thirty and already multi-millionaires – come from tertiary education backgrounds where they were weaned on readily available Internet access. Popular ‘browser’ client software for navigating the multimedia WWW includes Netscape and Microsoft Internet Explorer. On the other end, there exist approximately 30 local companies which call themselves ISP’s (Internet Service Providers), which operate in similar fashion to a cellular company such as Vodacom, providing either dial-up connections to the Internet and/or leased line connectivity to companies. This has led to the explosion of a number of related ventures, such as companies who speci alise in producing multimedia web pages (such as Adept Internet), Internet commerce, cable companies and modem suppliers (Perlman, 1996). 2.3) Technological Implications for Marketing Joseph (1996, p. 29) concisely described the situation as such: ‘ Marketing, like most business disciplines, is undergoing a period of change as a direct result of the information revolution. The rapidly declining costs of and increasing power of information processing technology is altering the in which customers and businesses relate to each other.

Marketers, however should be cautious not to attempt a quantum leap from more traditional meth ods as this is sure to bring issues such as lack expertise to the fore which could prove disastrous (Steyn, 1996). Essentially, the point is that as a marketing drive, the additional services supplied by technology provides the marketer with the opportunity to gain an edge in the race to win the consumer. More and more, new technology appears to be focusing on the add ition of value. On an individual level, for example, the marketer may use the technology to make himself more accessible to the consumer thus adding to his service levels. A company may realise added value by investing in expensive multimedia kiosks which introduce the subject of interactive marketing (Joseph, 1996).

The emergence of new and revolutionary technology forms a double-bladed sword, as it can represent both an opportunity and a threat to the business. In particular, this technology places an interesting and novel challenge on the shoulders of the modern da y marketer. The failure to utilise these developments can put the business at a great competitive disadvantage while even the practical application of the technology can provide major problems caused simply by the novelty of the options, a general lack of expertise and the difficulty of accurate prediction (David, 1997). The process must begin with the individual himself. A marketer who is not pushing the bounds of personal technological progression is most likely not inclined to do the same for the company (Joseph, 1996). Joseph (1996, p.29) concluded that ‘The Internet, multi-faceted appliances and even the creation of new applications for old technology are all the domain of the marketing visionary.’ 3) THE INTRODUCTION OF INTERACTIVE MARKETING ON THE INTERNET Internationally, the Internet medium is successfully selling everything from nuts and bolts to motorcars, property and traditional mail order products.

A pertinent question that arises is: ‘What forces led to either the accidental emergence of interactive marketing on the internet or the realisation of a need for the development of an alternative marketing medium that satisfied specific consumer or marketer needs?’ Steyn (1996, p.13) introduces the concept of interactive marketing through the words:’Interactive marketing uses new technologies to overcome practical database and direct marketing problems whilst building more rewarding customer relationships’. From the marketers’ point of view, interactivity, is the convergence of three main advertising functions or activities: direct marketing, sales promotion and conventional above the line advertising. The developments allowed by interactive marketing throug h the Internet focus mainly on how profitable market segments were identified and how these segments were reached. Interactivity allows the opportunity to track individual customers one at a time and to build individual relationships with each. This indic ates the vast benefits that Internet interactivity supply in terms of database formulation, management and utilisation.

However, the main challenge that does and will continue to plague advertisers in the future will be persuading the viewer to try the se rvice. Interactivity has three core characteristics: * Offer much more information than a television advertisement. * Requires the conventional copywriting skills combined with those of the direct marketer to turn the browsing viewers into sales prospects. * The emphasis, simply due the nature of the medium, is more likely to be on sales promotion type tools to entice the viewers to visit an ad and then on constantly refreshing the content and creative treatment, to ensure that they revisit it (Steyn, 1996) . The issues of the nature of the Internet as an advertising medium and the creation and maintenance of an Internet web site are addressed fully in sections 7) and 6.3) respectively. CD-ROM technology is unique in its ability to combine vital parts of promotion, that is: print, audio and visual messages in a package that can be distributed according to a random access database.

(Steyn, 1996). Clever marketers are using the medium to draw buyers closer to their companies as a whole and not just closer to the products or services they provide. This emphasises the advantages interactive marketing provides in terms of creating stronger, more unde rstanding relationships with consumers. The introduction of interactive marketing and specifically interactive advertising heralds the beginning of an era where customers will choose the advertising they wish to see, when they want to see it. This proves to be a hallmark of the contemporary con sumer who is far more informed than his blindly accepting predecessors have been. Consumers of today are evermore demanding personalised attention from businesses that wish to serve them. Furthermore, the very fact that the modern consumer is better infor med fuels his need for informed transactions with businesses. The modern consumer wants to know what product he is buying, what its detailed characteristics are, how he can expect it to perform, what alternatives he is faced with and why he should pay the offered price for it.

The nature of interactive marketing on the Internet provides an ideal medium for the satisfaction of the demanding modern day consumer. It is obviously of critical importance that a marketer recognises these needs and develops syste ms for satisfying them, hence, interactive marketing on the Internet. Steyn (1996, p.13) boldly concludes that ‘There is therefore no doubt that interactive marketing is helping to overcome practical database and direct marketing problems while building more rewarding customer relationships.’ Online shopping Online shopping is an element of interactive marketing that has found itself under the spotlight since its recent inception. Virtual retail sites on the Web continue to grow. Some sites are purely promotional while on the other extreme consumers are promised the lowest prices as the product is drop-shipped directly from the manufacturer (Swart, 1996). Anyhow, the Internet as a shopping mall has not enjoyed a favourable reputation as it is seen as a golden opportunity for sophisticated thieves to obtain credit card numbers from the cable.

As a result businesses have shied from any Net-based commerce. As a result the Web has been trapped in a form of time warp, usable only as an information medium and not as a transaction medium. Of the thousands of South African companies on the Web, few offer anything more than highly informative web sites which still leave the consumer wondering: ‘I wish the Internet could take me that one step further, SAFELY’. However, the tide is swiftly changing due to bold technology and business moves. The improved security and growth if the electronic-commerce infrastructure ha s prompted optimistic projections for the future of interactive online sales.

Furthermore, South Africa suffers from an intolerable postal problem and an effective home delivery system would have to be developed for home shopping to be viable (Rath, 1997). However, thoughts of an unrivalled ability to compare products, to be provid ed with product information and to be shown product demonstrations and alternative views will spur the quest for a workable online shopping system with great urgency. Recently a groundbreaking development in online shopping was made by M-Web in collaboration with over a thousand tenants ranging from large corporations such as ABSA to small retailers and service providers. Bruce Cohen, general manager of M-Web interact ive, claims that ‘The M-Web mall is designed to accelerate interest in online shopping by providing a one-stop shopping environment under on virtual roof.’ 4) WEB ADVERTISING 4.1) The Nature of Web advertising It is estimated that there is more than five million commercial pages on the Web, more than 100 companies are going online daily and that’net-watching’ has become a dedicated function within more progressive firms. Furthermore, companies that are online are more inclined to use this facility as a means for communicating new product developments (Rath, 1997). In practice, great achievements are being made in the sphere of Web advertising as the initial novelty of the concept wears off and experts in the field become more accustomed to the characteristics and dynamics of the Internet as an advertising tool (J.

Matthee, personal communication, 20 April 1998). Nevertheless, the Internet is not yet a proven advertising medium and as such is untested, unregulated and unrefined (Swart.1996). This very situation often results in wise businesses approaching Internet advertising companies that possess the necessary expertise to advertise effectively on the Internet. The Internet’s lack of intrusiveness as a medium (see Section 7) implies that direct marketing requires action by the consumer. In order to induce this required action, an advertiser needs to know his audience intensely in order to be able to entice brows ers to enter the site.

Therefore, it is the responsibility of the advertising agency not only to incorporate above-the-line strategies but also to include the below-the-line strategies in all their Internet clients’ campaigns 4.2) Web advertising Channels The origins of Web advertising are ironically rooted in what many consider as a frustrating method called ‘spamming’ whereby messages concerning products or business information were sent at random to Internet users e-mail addresses. This crude form of ad vertising can be likened to common junkmail found in a postbox among things of relevance such as personal mail and bills. Things have progresses somewhat and a number of channels have become available to the business interested in Web advertising and rega rdless of which channel is decided upon it is common practice to approach an online agency for aide (J. Matthee, pesonal communication, 20 April 1998). Creating an Electrical Storefront Thousands of businesses have established a home page on the Internet which offer a wide variety of information such as: descriptions of the company and its products; a company catalogue describing product’s features, availability and prices, company news, opportunities to speak with staff members and the ability to place an order before leaving the site. The main objective of these sites is brand building.

Another aim may be to support an event and in this case the page may be temporary. When a company decides to open an electronic storefront it has two choices: 1) The company can open its own store on the Internet through a Web server or; 2) The company can buy a location on commercial online service. The online service will typically design the electronic storefront for the company and advertise its addition to the shopping mall for a limited period of time (Kotler, 1997). Participating in Forums, Newsgroups and Bulletin Boards These groups are not designed for commercial purposes especially but participation may improve a company’s visibility and credibility. Bulletin boards are specialised online services that centre on a specific topic or group. Forums are discussion groups l ocated on commercial online services and may operate a library, a conference room for real time chatting, and even a classified advertisement directory. Finally, newsgroups are the Internets version of forums, but are limited to people posting and message s on a particular topic, rather than managing libraries or conferencing (Kotler, 1997). Placing Advertisements Online A number of ways exist for companies or individuals or companies who wish to place advertisements on commercial online services.

Firstly, major commercial online services offer an advertisement section for listing classified advertisements whereby the ads are listed according to when they arrived with the most recent arrivals topping the list. Secondly, ads can be placed in certain newsgroups that are set up for commercial purposes. Thirdly, ads can be placed on online billboards. This method can be irrit ating to the browser because the advertisements appear while subscribers are using the service even though they did not request an ad (Kotler, 1997). A fourth option is to hire an advertising agency to create and place an advertisement at a popular site on the Web, similar to buying timeslots on a television channel.

Advertising on search engines such as Lycos and Yahoo also proves to be effective although very expensive (J. Matthee, personal communication, 20 April 1998). Using E-mail A company can encourage prospects and customers to send questions, suggestions, and even complaints to the company, using the company using the companies E-mail address. Customer service representatives can respond to the customers in a short time via E-m ail (Kotler, 1997). 5) WEB ADVERTISING DEVELOPMENT IN SOUTH AFRICA In South Africa, the Internet is still restricted to very niched market providing companies with the chance to exploit this opportunity and build a database of visitors to their site.

This situation is quite obviously attributable to the economics of Sout h Africa’s social class structure. This is an advantage because marketers can use this information to create accurate profiles of the visitors to their site and develop personalised advertising efforts, which are especially crucial in the sphere of Web ad vertising. Currently, in South Africa, Computicket (http://www.computicket.com) has taken the lead in online bookings although services that are provided by Computicket naturally lean towards the use of the Internet as a medium (Douvos, 1996). David Frankel of Internet Solutions summed up the South African situation neatly by saying that ‘… People are still getting their hands around it [the Internet] and working out how to make money out of it. I don’t think that anyone is doing so at prese nt in South Africa, although a lot of people are trying.’ IS-Commercial a division Internet Solutions scored a South African first in 1996 in the development of a software engine that searched onl …