Online Advertising — Up, Down and Around

Until recently, online advertising had been the sole winner in a declining advertising market. In a further example of the recession's impact, an Interactive Advertising Bureau/PriceWaterhouseCooper, LLP study found that online advertising dropped 5% to $5.48 billion in the first quarter of 2009, the first drop since 2002. Yet even with these results, eMarketer projected (April 2009) that online paid advertising would increase from $24.5 billion in 2009 to $37.2 billion in 2003 — an increase that would put online ahead of newspapers and magazines.

At the same time that paid online advertising declined, "free" classified advertising exploded on popular online site Craigslist reports a recent Business Week report. The article discussed Pew Internet research that found almost half of Internet users had used an online classified site, with Craigslist accounting for 93% of the traffic.

I can attest to the popularity of online classified ads after dual listing my used car for sale with both Madison Newspapers and Craigslist. The newspaper allowed me a limited text listing unless I wanted to pay more, while on Craigslist I was able to create a display ad that showcased the car with two pictures and a broader description of the vehicle.

Although my first response came in from the newspaper classified, the subsequent and majority of responses came from my Craigslist ad. I'm happy to say that my car sold to the second respondent with no hassle. The buyer, a young woman, told me that she never looks at the newspaper classifieds — only at Craigslist.

Trailing Craigslist in the online classified category are eBay-owned Kijiji, and the fee-based newspapers.

Beyond classified ads, online display advertising expenditures increased during the first half of 2008 with the IAB (Interactive Advertising Bureau) reporting a 15% increase and Competitive Media Reporting finding an 8% increase. This is according to a recent comScore report that looked at the effectiveness of online advertising. The report is available for download with a simple registration here.

The report found that while more advertisers were shifting their online display spend from CPM (cost per impression) to CPA or CPC (cost per action or cost per click) that "research is showing that a click may not be a relevant measure of the impact of display advertising." With clickthrough rates at less than .1%, the report found that where online display advertising was working was with increases in advertiser's Web site visits, search queries on advertiser's brands, online purchase likelihood, and store visit likelihood.

In other recent research about online display ads, Conde Nast and McPheters found that ads that were "running on sites with related content were 61% more likely to be recalled than ads running on sites with unrelated content." The takeaway lesson from this research is: As part of your online ad placement strategy, think about context, since ads placed in related context perform better in terms of message recall.

Other ways that your overall marketing communications campaign can work is to integrate the online campaign creative with your search marketing initiatives (paid and organic), e-mail marketing tactics, off-line campaign creative. and overall marketing initiatives. Cross-channel integration leverages your message into multiple media. increasing the reach and frequency for the campaign.

If you are looking for creative ideas for your online advertising campaign take a look at, a Web site that pulls together examples of online ads.