Online Advertising

Social Media and the Internet: Click … or Clique?

Phillip Nones Uncategorized , , , , , , , , , , , , , , , ,

All of the hype about social marketing and social media might make you believe that people are flocking to this new form of communications in droves.

Well, if you think this … you’re right. And now we have the stats to prove it. The Nielsen Company has just released web statistics for the month of August that report that time spent on social networks and blogging sites accounted for ~17% of all time spent on the Internet.

Compared to August 2008, this figure is nearly triple the percentage of time spent on social networks and blogging sites just one short year ago. Seeing as how there is an upper-limit ceiling on the total amount of time available to spend online in any given day, the increased attention on social media is coming at the expense of the more traditional use of the web as an informational tool.

This is not to say that text and video content don’t remain central to the online experience, because that is clearly the case. But the ability consumers have now to use platforms like Facebook and blogging sites to “connect, communicate and share” is what’s driving much of the continuing growth of the web and online engagement.

Because of this new emphasis, is it any wonder more online advertising dollars are chasing social media than ever before? Nielsen pegs advertising on social media sites as representing ~15% of total online ad spending in August 2009. That’s more than double its proportion a year earlier.

Along with the shift in online ad revenues to social media sites, we’re also experiencing a major change in clickthrough behavior as it pertains to online display ads. Research published recently by comScore shows that the percentage of people who clicked on one or more display ads during a monthly period of Internet interaction – in this case March 2009 – was only ~16%.

How does that result compare with earlier surveys? It’s dramatically lower, and dropping. Just two years ago in 2007, ~32% of people online clicked on at least one online display ad over a month-long period – twice the proportion as today.

What’s more, the comScore analysis reveals that a very small portion of viewers represent the vast majority of the clickthrough activity. Specifically, only ~8% of the people are responsible for ~85% of all clicks. Of course, we can be sure that the robust clickthrough behavior of these 8% translates into equally robust product sales … NOT!

Clearly, any company that is attempting to promote products and services over the Internet needs to carefully study the composition of its market and the behavior of its online audience targets before making extensive online advertising program commitments.

The reality is, with the dynamics we’re seeing such as the behaviors noted above, it’s more likely an online promo effort will fail rather than succeed unless a dispassionate review of the situation is done beforehand and a practical, realistic program put into place.

But that’s so unlike many of the web advertising programs we’ve seen implemented up to now, which could be best characterized as: “Throw a bunch of advertising at the web and hope some of it sticks.”

It’s official: Clickthrough advertising effectiveness on mobile devices is somewhere south of atrocious.

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , ,

As usage of the Internet on mobile devices like the Apple iPhone has become more prevalent, many businesses have been wondering how important it is for them to cater to these users through the creation of web sites that are optimized for mobile display.

Although creating a mobile version of a web site doesn’t have to be a major undertaking, it is “yet another task” to add to the marketer’s never-ending to-do list. So, just how important is it?

Chitika, Inc., a Massachusetts-based online advertising network, has analyzed the behaviors of “mobilists” and found some interesting results when it comes to their viewing of advertising and taking action. In tracking more than 92 million ad impressions served up by browsers, it turns out that mobile internet users clicked through at a far lower rate than those viewing ads on desktop machines.

How much lower? The overall clickthrough rate for mobilists was 0.48%, compared to a clickthrough rate of 0.84% for non-mobile users. That’s a serious difference, and gets about as far in the basement as you can go.

But why are the numbers so abysmal? More than likely, several factors are at work. First, consider the ways people use their mobile devices. It’s usually because they want to know something immediately … and it’s at times like those that folks are less inclined to get sidetracked by clicking on advertising links. By contrast, the “immediacy” factor with non-mobile devices often isn’t as acute.

Also, consider the load time on mobile devices – rather much slower. For that reason, mobile web content tends to be less informationally rich — or compelling in its appearance — thus decreasing its “stopping” power.

What this means for advertisers is that the key for succeeding in the mobile space is catching consumers at just the right time, not happening to catch them at any time. Easy enough in theory … but would anyone care to volunteer for putting this into practice? Best of luck to you.

From the perspective of the media purveyors, the Chitika findings certainly won’t make their task of attracting additional advertising revenues in the mobile sector any easier. Perhaps that’s why The Wall Street Journal announced last week that, beginning in November, it will be charging mobile users a weekly fee to access its content on mobile devices – and those fees will be charged to WSJ subscribers and non-subscribers both.

It’s further proof that relying on display advertising revenue simply isn’t cutting it as a practical business model in the mobile environment.

Searching for effective lead generation and conversion.

Phillip Nones Uncategorized , , , , , , , , , , , , , , , , , , , , , , , , ,

In the current business climate, companies are relying more than ever on new sales opportunities to replace business that has been lost with current customers. And it’s pretty clear by now that “search” has emerged as the form of online promotion that generates the best lead generation and conversion results — outstripping other e-promotional tactics such as online display advertising and newsletter sponsorships.

This isn’t surprising, of course. Search advertising captures the interest of online viewers precisely when they’re in “search mode” for specific products and services, rather than when they’re just surfing the ‘net for news and updates.

(In fact, some advertisers have come to believe that even print advertising outperforms online display advertising. That’s because readers are more likely to browse all the way through print publications. Compare that to visiting informational web sites where viewers are far more prone to selectively pick and choose the pages that they open. A well-placed display ad on a “new technology news” page, for example, might be invisible to the vast majority of viewers who come to the home page and then decide to click through to only one or two additional pages on the site.)

But back to search. Many advertisers wonder which is most effective: gaining high “natural search” rankings that occur based on the content of the web site, or opting for pay-per-click search listings such as Google’s AdWords program with their entries on the right side of the screen.

As it turns out, both tactics have their pluses.

In fact, a new year-long study that ended June 30, 2009 of more than 25 e-tail web sites by Engine Ready, Inc., a search engine software development firm, found that visitors who clicked through to the sites from paid search ads were ~50% more likely to make a purchase, compared to visitors who came to the same sites via clicking on a natural search link.

Specifically, Engine Ready discovered that the conversion rate from pay-per-click links measured 2.03%, while the conversion rate was only 1.26% from organic search clickthroughs.

On the other hand, various research studies conducted over the past few years demonstrate the clear popularity of natural search listings over paid search listings. It’s been shown pretty consistently that around two thirds of total clicks are made on natural search listings, compared to just one-third on pay-per-click listings.

So the key takeaway is that any marketing program worth its salt incorporates search marketing as a key component. And in most cases, that effort should encompass search engine optimization for natural search rankings along with a pay-per-click advertising program.