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“The first problem of our business is to win an audience, hold an audience and interest an audience.” William Paley, Radios as a Cultural Force, 1934
Has the business of media acceptance really changed?
Commercial Beginnings of the WEB
Fewer than twenty years ago, the commercial use of the WEB was considered improper Restricted to the likes of the military and academia
The “big bang” occurred in 1994 when the new Internet backbone was created allowing the commercial uses to become operational NSF Funding and acceptable uses policy removed Global marketing at the most acceptable costs ever!
Background
Rapid growth resembles the early diffusion of TV in the 1950’s
Currently in the middle of the story - outcome unpredictable
Many cybercritics feel it is a fad –partially playing out already
Business Applications
Effective way to communicate with other businesses (suppliers, distributors) via email
Fabulous way to reach customers Interaction of video, picture, sound Motivated consumers Very low cost for global reach
Current Trends
Widespread belief that the Internet will emerge as an extremely useful tool for business planning and become a part of the marketing mix
Useful as an electronic store front, source of marketing research, and marketing communication
eBay
Basics
What is the Internet? Is a network of
computers reaching every country in the world
Social space for communication
no governing body - shaped by users
Background Internet emerged in
the 1960’s Developed by the
Defense Department as a fail safe way of communicating messages in the event of a nuclear attack
Until the 1990’s was used almost exclusively by the Defense Department and academia
Almost unheard of by the mainstream until the mid 1990s
Internet Options
E-Mail communication without paper or delay
ListServ discussions of specific products
Usenet 17,000+ discussion groups unobtrusive source of primary data
WWW universal database
Recent Developments Consumer to
Consumer Commerce Consumer Auctions Market Monitor –
honesty and reliability profiles
Business vs. Pleasure Overlapping – eBay
average 27 minutes per visit
Surfing replacing other media options
Dramatic Growth
Growth Patterns # computers
connected to the ‘Net (Internet hosts) 2.2 million to 100 million January 1994 to January 2006
How is the Internet Organized?
Major Internet Classifications .com commercial .edu educational .gov government .net Internet service provider .org non-profit organization
New suffixes currently necessary to accommodate growth
Who is out there?
Content Providers businesses,
universities, governments that allow others to peak into their computers
Advertisers Audience
The Audience
No one knows exact numbers
Conservative approximation – 167 million worldwide (75 active)
#’s growing quickly – 90% growth in last 5 years
Less than 4% world’s population
50% of users feel it is a necessity
Profile 37% professionals,
12% technical fields, 14% managers, 2/3 males
Women would rather NOT shop on-line security concern
Nielsen Ratings
Nielsen Ratings available at www.nielsen-netratings.com
Interesting Stats 35 million households online at any moment 550,000 new households online every month 760 new households online each hour
158.3 M United States 37.7 M Japan 21.0 M United Kingdom 14.6 M Canada 8.5 M Australia 1.9 M Singapore *Home Internet Access
Weekly Top 10 Banner AdsMarch 11, 2001
Banner Image 1. Bonzi Software 2. ClassMates 3. Amazon 4. Match.com 5. JP Morgan Chase
.
6. ClassMates
7. CDNOW
8. JP Morgan Chase
9. Colonize
10. JP Morgan Chase
*Banners ranked by impressions
Lead Industry Advertisers
LEADING CPG ADVERTISERS | ranked by impression | Mar 28-Apr 3, 2005
PepsiCo, Inc. 157,196,000 IncreaseYourHealth.com 83,428,000 Rodan & Fields 24,961,000 General Mills, Inc. 22,770,000 The Procter & Gamble Company 17,983,000 The Coca-Cola Company 12,567,000 Nestle USA, Inc. 10,782,000 Johnson & Johnson 10,580,000 Groupe Danone 6,927,000 The Estee Lauder Companies Inc 6,309,000 Other 90,493,000 Total 443,996,000
Top Ten Hot PropertiesMarch 11, 2001
AOL/Time Warner Websites
39. 4M page hits Yahoo!
30.7M page hits MSN
26.2M page hits Microsoft
10M page hits Excite Network
9.2M page hits
Lycos 9.1M page hits
Disney Internet 6.8M page hits
eBay 6.8M page hits
eUniverse Network 6.1 page hits
About the Human Internet
5.8M page hits
Top Ten Parent Companies Week Ending March 28, 2005 (Home)
United States: Top 10 Parent CompaniesWeek ending March 28, 2005Home Panel Parent Name Unique
Audience(000)Reach
%TimePerPerson
Microsoft 55,711 51.48 00:35:35TimeWarner 52,356 48.38 01:34:25Yahoo! 48,509 44.82 00:49:58Google 31,802 29.38 00:09:39eBay 18,436 17.03 00:51:27US Govt 12,922 11.94 00:12:27Ask Jeeves9,943 9.19 00:10:53United Online9,894 9.14 00:27:51RealNetworks9,770 9.03 00:22:12Amazon 9,282 8.58 00:10:09
Internet Usage Stats (March 28, 2005)
Number of Session per week
Time Spent per site PC Time per week Page Views per week Active Digital Media
Universe Current Digital Media
Universe
10 00:00:49 08:38:22 23 108,226,441 201,566,843
How do Marketers Use the Internet?
Net as a planning tool Secondary Research Source
gather market information/library cheap, easy access to government releases data more current than paper publications
Primary Research Sourcesurvey customers/prospectscollect customer service inquiries/product use
ideas
How do Marketers Use the Internet?
Net as a Distribution Channel (I.e., direct catalog) cost savings push vs. pull payment concerns distribution of electronic products I.e.,
software, electronic magazines, music, video clips
How do Marketers Use the Internet?
Communication Medium keep in touch with the
TM functions similarly to
TV or magazines - except is a two-way interactive medium
Communication Approaches Maintain a WEB site with information
about products and services purchase advertising space on other
WEB sites Build an e-mail data base of consumers Hold PR events on-line Offer coupons, sweepstakes, SP
approaches
Advertising and Marketing on the Net
Product vs. Content Advertising corporate home pages banner ads
Increasing Role of the Internet in Entertainment Product distribution and promotion
Corporate Home Pages
Product-oriented sites request brochures scheduling questions/help
Source of Advertising and PR Information
Banner Advertisements
Paid placements on other sites that contain editorial material
Click hyperlinks you to ad site’s home page
Example from USA Today Homepage
Banner Ads
Placement crucial to gaining exposure to the TM
Related and similarly profiled pages optimum
Top Ten http://
www.nielsennetratings.com/hot_off.htm
Other Types of CyberMarketing
Virtual Malls gateway to a group of
Internet storefronts example - http://
www.internet-mall.com/
advantages - attracts browsers to site
Other Types of CyberMarketing
Coupons packaged for goods,
fast-food and travel companies
charges from $3 - $15 per thousand coupons distributed
free-standing inserts $7/1000
Event Marketing Avenue for ties to
event and sports happenings
Superbowl and Oscars have sites
Sponsorships cost $100k-$225k
logos and links