1. Ashley Friedlein Staff

    CEO at Econsultancy

    01 April 2004 15:59pm

    Ashley Friedlein

    Much has been said about the lack of creativity within online advertising. A fair amount has been undertaken to try and redress the problem – more awards for interactive creative, the IAB’s Creative Showcase, increasing numbers of educational seminars and briefings.

    However, of the 2%+ of ad spend that goes online, the majority of that is spent by media buyers, with the vast majority of the spend going on CPM buys, with the majority of placements going to a very small minority of publishers (mostly portals, ISPs etc.). I don’t know exact figures but I suspect the value of spend on more creatively challenging and complex online advertising, focusing on tighter audience segments, is really pretty small. Hopefully this will change but there is still a very long way to go.

    My own feeling is that online ads are conceived in too ‘flat’ a manner. Ironically, there is too little thought given to *interaction* and how an ad might be *used* rather than seen, or clicked on. Most online ads I see still go something like this – here’s a piece of copy, here’s another piece of copy, and here’s the call the action. Usually I’m not even around on the page to see stage 3. The likes of New Media Age review online ads (with their Ad Watch section) – but how? In print. This isn’t how these ads should be reviewed in my opinion. I think the opportunity is to see online ads as experiences, as content, indeed as mini web sites.

    Return on investment for online advertising is very largely measured in terms of response – usually clicks. Efforts are being made, with some success, to position online also as an advertising medium for brand impact. And rightly so, I believe. However, not many people seem to be measuring ROI in terms of the success of the ad in engaging the target market where there is no need to even leave the publisher’s site - a little is done with ‘play rates’ and ‘close rates’ for rich media ads (for ‘time spent with brand’ type metrics).

    Rather than thinking about ways to get your target market to come to you, shouldn’t advertisers (and their agencies) consider ways in which they can use online advertising to enter into a dialogue with their customers wherever *they* choose to be. For example, if I was selling mortgages, where the value of a lead and acquisition are clearly very high, then maybe my online ‘ad’ could, in fact, be a chat interface allowing likely customers to ask questions to real people (an IFA, for example), in real time. I can target the ‘ad’ very tightly to manage the rate and quality of enquiries (a bit like a call centre) and I don’t have to get my potential customers to leave the site they found my ‘ad’ on. 20% of clicks don’t even arrive at their destination so why lose all that value in trying to drag a customer to you when the interaction can happen then and there on the site your customer has *chosen* to visit?

    From my point of view as an advertiser I wouldn’t dream of spending money on basic banner ads except, just possibly, in the name of brand building, in the right places. However, if my ‘ad’ was in fact like a mini-website, which was served into the relevant context, where I knew my target market to be, and which allowed users (strictly on a permission basis i.e. they choose to interact) to, say, explore how we could help them choose an e-mail marketing agency… now that’s much more compelling. And entirely possible already.

    I also think that ad serving technology has been underexploited to date. Not so much for serving ads across publishers’ sites but for use by site owners on *their own* sites. Imagine the following scenario: you, the advertiser, spend a lot of money promoting a new brand on TV and in press; as a result a lot of people search on that term in various search engines; (hopefully you’ve already thought about your search engine marketing strategy before you spend all that TV money, so..) your site comes up in the results; the user comes through to your site with the TV ad or press ad in mind; they get to your site but can’t quite find that one thing that drove them there. You’ve broken their journey and possibly lost their custom and squandered your ad spend.

    Of course, one would hope in the above example that your homepage, or landing page, was already updated to tie in with your TV campaign, or that your navigation/search was good enough that users could find what they wanted even if not straight away. But it doesn’t always happen that way – maybe the content management system and templates can’t be updated quickly enough to capture that value, maybe there are ‘other priorities’ that mean this ‘project’ can’t be dealt with in time?

    You could, however, use ad serving technology as a ‘lite’ solution to get around this. For example, you could pick up the referring search string and if it matches your new brand that you’ve just advertised, you could use the ad server to make sure relevant content and links are served up to the user upon arrival. Even better, the ad server is an ASP solution and you only pay per ad served – a bit like ‘pay and go’ with no up front costs. Effectively you are using the ad server as a tactical cross-sell / promotional tool to capture and maximise your ROI on ad spend in other media.

    Is all of the above pure fantasy? Maybe. But I’d be surprised if I could even have this sort of conversation with a media agency and their planners / buyers. I wonder whether online “adverts” are better off in the hands of agencies skilled in understanding interaction design, customer experience modelling and website build (data capture, functionality and so on)? The technology is all there but I rarely see what I’d consider truly creative and compelling applications of the medium for what it does best.

  2. Mark Draper

    Managing Director at Invention Interactive Limited

    07 April 2004 10:08am

    Mark Draper

    Excellent post, excellent points Ashley.

    I do feel that there are a number of fundamental, almost 'structural' issues which are holding back 'online' as a creative and credible medium:

    OPPORTUNITIES
    My company devises, plans and executes modest online campaigns for clients, mainly SME's, mainly B2B. One of our biggest challenge is not only sourcing media opportunities which reach the clients' target market but also then finding media owners who are willing to go beyond a basic 'under 20k' banner. Those that do, at least for our clients, are cost-prohibitive - particularly taking into consideration what I believe to be an 'online credibility gap' across the industry. This is particularly the case when there is a direct ROI comparison between 'offline' and 'online' budget spend....

    CREDIBILITY GAP
    It becomes increasingly difficult to for a company like mine to present consistent, credible online advertising services/opportunities to clients when the online 'media owners' (in general terms) seem to suffer from a lack of professionalism and credibility in the way they present and structure their own services. In my opinion, just one example is the recently introduced Yahoo/Overture PFI/PFC programme. I have clients who had recently renewed their Inktomi PFI options for an entire year - sold by me to them based on 24hr refreshes, distribution through the Ink network and the facility to change a URL once during the 1yr subscription period.
    Then, this programme is effectively cancelled by the purchase of the Ink database by Overture/Yahoo. I then try to find out more about the new Overture/Yahoo deal and come up against half-baked answers, or no answers whatsoever to take back to our clients. I am then faced with a plethora of question which I (as the consultant) cannot answer simply because - as usual - the online media owner is focused on their own 'early cash recovery' and not providing a fully developed service where the terms of the service, the ROI and benefits to their customers are fully explained and developed.
    I explain to my clients that 'aquisitions happen', but when I put their questions (as well as my own) to Yahoo/Overture I am greeted with either no response or answers which clearly show they haven't fully scoped out their services.
    I use this as one example, there are many others.
    We recently managed an opt-in email campaign with some very attractive targeting options through a respected, credible online journal. Over 30% of the campaign resulted in 'bounce-backs'. When we queried this, we were simply told 'we need to clean up our databases'!! This is despite assurances that the databases were current and regularly cleaned before we undertook the campaign.

    I regularly have proactive conversations with owners of portals set up to service large, international, well established exhibitions and events about microsites, sponsorship, banners, opt-in email campaigns (where many of our clients are actually exhibiting!) to be told 'we don't offer this', or 'we hadn't thought of that'! Noting technologically challenging, all standard stuff - but they are just not in the 'mindset' of offering online opportunities.

    The end result of this is that my company (as an advocate of online marketing) and the whole industry looks 'tin pot'. Particularly when put up against 'offline' options where the client can accurately target a market/readership (complete with audited readership stats, info on coverage and reach), is provided with comprehensive post-advertising reporting, they know the goalposts aren't going to be moved half way through their campaign and if things do change the 'offline' media owner is going to have all their ducks in a row BEFORE they launch it on an unsuspecting public. If you were an SME with limited budget and you have to show ROI, where would you spend your money?

    EDUCATION
    Your excellent post makes some very incisive, savvy observations about the possibilities and current limiting factors in online marketing. But one thing we all have to consider is, even in 2004, how new and bewildering online marketing is to clients. Many of our clients (and I'm sure I'm not alone here) can just about cope with the concept of a banner ad and an opt-in email marketing campaign. This does represent a fantastic opportunity for the consultant to be the purveyor of 'online knowledge' to the client, but many are extremely wary of going outside their 'comfort zone'. I think the industry, and ourselves have a responsibility to become 'educators and evangelists' for online, but this role is not helped by the online industry itself which doesn't seem to be able to get its act together. Before we can talk about the subtleties of interaction and data collection, I believe there needs to be a huge amount of effort on the part of the marketing industry and the consultant to 'educate and convince' the client. I make this point from the standpoint of someone who considers that I have so much to learn myself.

    Just some hastily written thoughts in reply to a very good initial post...

    Just some random thoughts, but 'online' needs to realise that it is in a competitive marketplace where clients will make their budget decisions based not only on ROI but on the credibility and professionalism of the media channels on offer.

  3. Nitzan Yaniv

    Account Director at Eyeblaster

    07 April 2004 11:58am

    Nitzan Yaniv

    Is 'interaction rate' set to become the new 'clickthrough rate'?

    Rich media formats have significantly improved the creative potential of online advertising. Features such as polite loading, bandwidth detection, smart streaming, video and additional assets have opened up new opportunities by minimising file-size and technological constraints. However, while ad-serving technology has evolved very quickly, the way rich formats are actually being used is still in the proverbial Stone Age. Agencies and clients are mostly using (or should I say abusing) the formats to 'get in the way' and interrupt user experience, rather than trying to find ways to enhance it.

    As a result, web savvy audiences get fed up, publishers are under pressure to ban various formats, online advertising is getting bad press, and most campaigns are not performing as well as they perhaps could.

    The main culprit is the unhealthy and irrational obsession with CTR. Unless a campaign is purely about driving traffic, what is the point in obsessing about it? Instead of trying to get users to CLICK , advertisers should focus on getting users to INTERACT. By delivering useful and/ or entertaining applications within the format, interested users can respond with minimum interruption to their original task.

    Polite loading technology can be used to deliver rich content up to 1mg into in-page units such as banners, skyscrapers LRECs etc. In-page units can also be used to obtain permission for launching a floating ad (on user rollover, similar to expandable banners). Enhanced features such as 'additional assets' can be used to deliver additional content 'on demand' when prompted by the user. Data capture, email and SMS fulfilment can be seamlessly integrated into rich media formats as standard, with minimum fuss, removing the need to create any backend applications.

    So, rather than trying to interrupt users in their tasks, advertisers should use the increased capacity and functionality of rich media formats to deliver the brand experience and elicit the desired response within the ad. Rich media advertising should be seen as a 'push' channel to distribute content rather than as just a way of 'pulling' customers to client websites.

    Detailed measurement and tracking is available to allow agencies and clients to measure every interaction with their ad, driving down the need to focus on CTR only. ROI models and campaign scorecards should be redefined to account for interactions and clients should be taught to put clickthrough in perspective.

    (The views and functionality described in this piece are based on what's available on Eyeblaster right now.)

    On 15:59:29 1 April 2004 Ashley wrote:
    >Much has been said about the lack of creativity within
    >online advertising. A fair amount has been undertaken to
    >try and redress the problem – more awards for
    >interactive creative, the IAB’s Creative Showcase,
    >increasing numbers of educational seminars and briefings.
    >
    >However, of the 2%+ of ad spend that goes online, the
    >majority of that is spent by media buyers, with the vast
    >majority of the spend going on CPM buys, with the majority
    >of placements going to a very small minority of publishers
    >(mostly portals, ISPs etc.). I don’t know exact
    >figures but I suspect the value of spend on more
    >creatively challenging and complex online advertising,
    >focusing on tighter audience segments, is really pretty
    >small. Hopefully this will change but there is still a
    >very long way to go.
    >
    >My own feeling is that online ads are conceived in too
    >‘flat’ a manner. Ironically, there is too
    >little thought given to *interaction* and how an ad might
    >be *used* rather than seen, or clicked on. Most online ads
    >I see still go something like this – here’s a
    >piece of copy, here’s another piece of copy, and
    >here’s the call the action. Usually I’m not
    >even around on the page to see stage 3. The likes of New
    >Media Age review online ads (with their Ad Watch section)
    >– but how? In print. This isn’t how these ads
    >should be reviewed in my opinion. I think the opportunity
    >is to see online ads as experiences, as content, indeed as
    >mini web sites.
    >
    >Return on investment for online advertising is very
    >largely measured in terms of response – usually
    >clicks. Efforts are being made, with some success, to
    >position online also as an advertising medium for brand
    >impact. And rightly so, I believe. However, not many
    >people seem to be measuring ROI in terms of the success of
    >the ad in engaging the target market where there is no
    >need to even leave the publisher’s site - a little
    >is done with ‘play rates’ and ‘close
    >rates’ for rich media ads (for ‘time spent
    >with brand’ type metrics).
    >
    >Rather than thinking about ways to get your target market
    >to come to you, shouldn’t advertisers (and their
    >agencies) consider ways in which they can use online
    >advertising to enter into a dialogue with their customers
    >wherever *they* choose to be. For example, if I was
    >selling mortgages, where the value of a lead and
    >acquisition are clearly very high, then maybe my online
    >‘ad’ could, in fact, be a chat interface
    >allowing likely customers to ask questions to real people
    >(an IFA, for example), in real time. I can target the
    >‘ad’ very tightly to manage the rate and
    >quality of enquiries (a bit like a call centre) and I
    >don’t have to get my potential customers to leave
    >the site they found my ‘ad’ on. 20% of clicks
    >don’t even arrive at their destination so why lose
    >all that value in trying to drag a customer to you when
    >the interaction can happen then and there on the site your
    >customer has *chosen* to visit?
    >
    >From my point of view as an advertiser I wouldn’t
    >dream of spending money on basic banner ads except, just
    >possibly, in the name of brand building, in the right
    >places. However, if my ‘ad’ was in fact like a
    >mini-website, which was served into the relevant context,
    >where I knew my target market to be, and which allowed
    >users (strictly on a permission basis i.e. they choose to
    >interact) to, say, explore how we could help them choose
    >an e-mail marketing agency… now that’s much
    >more compelling. And entirely possible already.
    >
    >I also think that ad serving technology has been
    >underexploited to date. Not so much for serving ads across
    >publishers’ sites but for use by site owners on
    >*their own* sites. Imagine the following scenario: you,
    >the advertiser, spend a lot of money promoting a new brand
    >on TV and in press; as a result a lot of people search on
    >that term in various search engines; (hopefully
    >you’ve already thought about your search engine
    >marketing strategy before you spend all that TV money,
    >so..) your site comes up in the results; the user comes
    >through to your site with the TV ad or press ad in mind;
    >they get to your site but can’t quite find that one
    >thing that drove them there. You’ve broken their
    >journey and possibly lost their custom and squandered your
    >ad spend.
    >
    >Of course, one would hope in the above example that your
    >homepage, or landing page, was already updated to tie in
    >with your TV campaign, or that your navigation/search was
    >good enough that users could find what they wanted even if
    >not straight away. But it doesn’t always happen that
    >way – maybe the content management system and
    >templates can’t be updated quickly enough to capture
    >that value, maybe there are ‘other priorities’
    >that mean this ‘project’ can’t be dealt
    >with in time?
    >
    >You could, however, use ad serving technology as a
    >‘lite’ solution to get around this. For
    >example, you could pick up the referring search string and
    >if it matches your new brand that you’ve just
    >advertised, you could use the ad server to make sure
    >relevant content and links are served up to the user upon
    >arrival. Even better, the ad server is an ASP solution and
    >you only pay per ad served – a bit like ‘pay
    >and go’ with no up front costs. Effectively you are
    >using the ad server as a tactical cross-sell / promotional
    >tool to capture and maximise your ROI on ad spend in other
    >media.
    >
    >Is all of the above pure fantasy? Maybe. But I’d be
    >surprised if I could even have this sort of conversation
    >with a media agency and their planners / buyers. I wonder
    >whether online “adverts” are better off in the
    >hands of agencies skilled in understanding interaction
    >design, customer experience modelling and website build
    >(data capture, functionality and so on)? The technology is
    >all there but I rarely see what I’d consider truly
    >creative and compelling applications of the medium for
    >what it does best.

  4. John Wards

    Multi Media Developer at SportNetwork.net

    24 April 2004 16:04pm

    John Wards

    Good post Ashley.

    Would have responded earlier but have been involved in redesigning my site to take the new IAB fomats (Well the 728s and the 160 skys anyway..)

    I think the lack of creative thinking in the online advertising market has a few different causes. The big ISPs, Portals (Freeserve, MSN, Yahoo etc) have a "Image" to protect and are ususaly not going to be helpfull to agencies when they come with a creative solution that is not a banner, pop-up or an overlay.

    Then you have the ever flexable and money desperate (Talking from experice here ;-)) publishers who are have audiences ranging from 10,000 users right up to 500,000 users in a monthly period who know they have a valuable product and want to be flexable and not take the standard stuff and try and get content intergration thats value to their users and in turn value tot he advertiser but struggle because the big boys control the way.

    The small publishers do have a louder voice when they join up with RealMedia, AdLink, Ad2-one etc but as each publisher is different its hard to get unique campains and also as there is another link in the chain its even hard to get your idea heard by the money me.

    I would class my self as a small publisher (300,000 users, 6+ million page imps a month) and I am well looked after by my network who know I am very flexable in terms of creatives etc. But trying to get an agency to think something other than a blummin banner or an oh so clever but so user annoying overlay is so hard its impossible.

    I would love to sit down with the likes of O2 to come up with a campain targeted at my users using banners, content intergration, competitions, section sponsorship, user special offers etc etc but I would never get the chance but the ROI for 02 would be huge...better than the normall 0.02% CTR they are getting currently! They would most likely get 50,000+ people at least taking an interest in one or more of those things. But because of the Company - Agency - Network - Publisher system that we have to use Company usually only hears "Banners and Overlays"

    HoHum.

    John

  5. Samuel Arango-Barona

    Head of Marketing & Business Development at Bridgehead Goup Ltd

    15 May 2004 03:13am

    Samuel Arango-Barona

    This is the type of discussion that will help the industry move forward. Perhaps Ashley will be cited in posterity as having coined the phrase?

    Creative efforts are currently been made by various companies; for example: http://www.unitedvirtualities.com/demo/slide1/

    This is one of my favourites, and they are very close in delivering the full promisse of their technology; that is, its high impact, and in some cases entertaining, it facilitates mini-sites, sweepstakes, games, etc.

    We have the technology and we even have buyers experimenting; at least in the US, but as always, we in the UK are lagging behind.

    Perhaps more recognition of campaigns making use of this type of technology that shows them delivering results would be a good way to drive our creatives into action; we all know how much they enjoy the recognition.

    If other media have public awards to highten their profile and reputations, isnt it time we in the online arena pushed for something similar?

    I am not certain if anything of this type exists presently, but if not, then perhaps the CIM would be a good starting point, as they are now increasingly recognising the online medium as a vital part of the marketing mix.

  6. Angus Norriss

    UK/Ireland Digital Lead (Nokia) at Wunderman/Blast Radius

    17 May 2004 18:28pm

    Angus Norriss

    A sound posting, Ashley

    Indeed, online advertising is developing within itself but can often become intrusive advertising if we are not careful. Similary,the 468 x 60 banner can be detrimental to big brands when they are stuffed in to small file sizes of 15KB and expected to keep up with the mutli-million pound TV ad at the same time.

    If the online ad industry is to mature positively then it should try and align itself in parallel with TV advertising; web sites know peak rates of visitor activity and demographics of registered users - why don't they sell peak banner advertising slots? (.i.e lunch hour and evening)

    The TV ad is not as effectively measured - it might be on in my living room but what if I got up and left to make a cup of tea - is that registered as an equivalent impression in their world? I think it is. Online advertising is measureable and quantifiable moreso than TV and should therefore maximise this technological position.

    We at Hedgeapple develop online advertising that seeks to engage the user without need to click them away into oblivion. The banner ad is increasing in screen presence and mini sites are available within these advertising spaces if produced carefully. This Driven film trailer http://www.hedgeapple.co.uk/driven was produced before the film was finished to engage users to make their own trailer from within a banner format. By mousing over the flicking little images a self-build process starts and one can record the order of the trailer. Once built it can be emailed to a friend saying "hey, check out the new movie trailer I just made...' (email functionality is not available for this demo).

    With the introduction of DVR's and TIVO we can now skip the ad break. The implications mean that the traditional TV ad slot is looking for another broadcast channel. TV advertisers should start to think with strategic online planners and developers and creatives far earlier in the stage of a campaign. Just ask the good online guys 'what's possible?' rather than just posting a thumbnail sized MPEG and adding clever streaming techniques. We won't damage the ad or the brand but we can get users to interact with it. Broadband is here and it will only get bigger so the sooner we are all in the same planning meeting the better.

    Let's hope the buyers, planners and TV creatives actually see this movement coming at them.

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