How can we be sure that online advertising works?
…and why you should consider affordable advertising with AdzZoo.
According to market research sources, search engines outperform all other online advertising media in driving visitors to web sites. Moreover, consumers are five times more likely to purchase products after seeing search listings versus banner advertising. In fact, statistics show the following:
1) 77% of Internet users employ search engines more frequently than any other online advertising media, surpassing banner ads, Web links, and e-mail links as the leading tool for discovering information about a product or service.
2) 84% of Internet users who are online four or more hours each day reported they use search engines frequently to discover Web sites and find products or services.
3) 55% of Internet users are more likely to purchase online after seeing search listings versus 9% for banner advertising.
Is the Online Advertising industry shrinking, or is it growing at a reduced rate?
Growth in online advertising for the first time will shrink to single-digits in 2009, according to eMarketer – yes it is still growing despite our world wide recession. Search engine keyword based marketing, like Google AdWords, is still growing at double digit growth rates. Look at the pricing revolution online advertising news article for April. The fact remains that there may be a big pricing revolution in advertising online, however when you are focused on search engine online advertising then growth is fine. More and more business people are understanding the power and simplicity of search engine marketing and how online advertising benefits their business (in terms of sales). So yes the US economy is shrinking, ever so slightly, however online advertising (specifically search) continues to grow.
The world of online advertising can be divided into a several different advertising options. These options are not exclusively the only areas from which to choose, however they represent the most popular areas within the online advertising menu. And they are:
1. search engine advertising: more than 50% of the total spent last year in online advertising. This relates to keyword based search engine optimization and paid advertising via pay per click campaigns. The three biggest sources of this type of advertising are Google, Yahoo, and MSN. There are plenty of additional smaller online search advertising options but these three are the best of the best and each one has a pay per click advertsing interface that is simple to use. Just in case you are wondering the big three search engines represent 98% of the entire search advertising market. Get it correct with the big three search engines and you are getting it right with 98% of your keyword based search audience. The great thing about search engines is that they make it so easy to purchase traffic. In fact online advertising has now become as easy as click, setup, and pay. All you need to do is select the appropriate keyword(s) for your service offerings, select the geographic region you want to represent, and away you go. Note that search advertising is paid per visitor so if your ad is not clicked on you pay nothing. How would you like to buy a billboard on the road that you only pay when someone calls you. Experts refer to this type of online advertising as an outstanding deal. Even google will give you free credit card processing for all the goods you sell online providing you are purchasing traffic from them and providing your ROI (return on investment) is less than or equal to 1,000 percent. Even Google thinks you should be able to make ten times your online advertising spend in total revenues. That says something right there.
2. display ads: 21% of the total online advertising last year and falling fast. Banner or contextual advertising is not popular and is not working, even at these cheap cost per thousand impression rates. Here you rent space on a web site and if you get lots of visitors to your site great since you pay for the space and not for the visitors. This is not the best way to advertise, but there are plenty of places to get CPM deals in the $0.60 or lower range so why not pay next to nothing and see what sticks.
3. classified advertising: 17% of all spending last year or just over $4 billion dollars spent on classified advertising. So next time you say classifieds are not for your company or service offering you better think again. In terms of dollars spent last year classifieds came in at roughly one third of the amount spent on keyword based search. Classified ads run at a cost per space and not for visitors directed to your website so again you are paying per thousand page impressions whether people click on your ad or not.
4. lead generation: 6% of all advertising spending last year, or over $1.4 billion dollars. It is interesting to see Google use lead generation in some cases since we all know Google is getting short end of the stick on their paid keyword based advertising (per click). How do we know that? Well if I am a company and I spend $1 to make $3 from traditional advertising (TV, radio, newspaper) and now I am spending money with Google to the tune of $1 for each $9 in revenues then it stands to reason that Google is getting the sorry end of the stick compared to the cost of traditional advertising. Some argue this is exactly why keyword based search advertising is destined to grow.
5. rich media: 4% of all spending last year or almost $1 billion dollars. This sort of relates to display ads, except that these ads are video targeted and most networks know that the targeting aspect alone will improve conversion rates. In advertising the better the targeting the higher value and the greater the advertising revenues. Could this be why Google bought youtube for over $1.5 billion dollars?
6. Email: holding on at 2% of total online advertising last year. Hard to believe email advertising accounted for $500 million dollars in revenues last year. That is a lot of money spent on email advertising.
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