internet advertising © 2001 ann schlosser, university of washington business school
TRANSCRIPT
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Internet Advertising
© 2001 Ann Schlosser, University of Washington Business School
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Agenda
• Permission marketing
• Yesmail.com
• Banner advertising
• Optimization
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To Opt-In or Opt-Out
• Opt-in– Send messages only to those
who request them
– Default = not included in list
– Result: smaller lists (48.2% participate)
– Favored by consumers
– Risk missing new opportunities
– Policy employed by EU
• Opt-out– Send messages to people unless
they request NOT to get messages
– Default = included in list
– Result: larger lists (96.3% participate)
– Favored by firms
– Introduce to US Congress as baseline privacy law
“When I get a spam that only says ‘Click here to opt out,’ that really annoys me. That’s not permissions marketing.” – Seth Godin, author of Permission Marketing.
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Dear cadrys,
Several times a month, eBay sends out valuable email communications with news, offers and special events that help you buy and sell. Unfortunately, we have noticed that an error occurred during your registration process that prevented you from receiving these communications. Many of your Notification Preference defaults were set to "no" rather than to "yes", which means that unlike other eBay members, you're not receiving these types of communications.
We'd like to resolve this problem quickly and efficiently. Therefore, on 1/8/01, we returned all your Notification Preferences to the standard default of "yes" to put you in line with the rest of the eBay community. However, we want you to choose your Notification Preferences rather than rely on our standard defaults and will therefore not include you in any communications until 1/23/01. This will provide you with some time to evaluate these choices and modify your Notification Preferences. You will, however, continue to receive certain administrative emails that are part of executing your eBay transactions.
eBay : Where "Opt-out" Means "Keep Trying"
Posted at http://slashdot.org/articles/01/01/09/1648257.shtml
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Familiarity with E-Mail Marketing Models
Retention Acquisition
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Member Registration
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Customization and Testing
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Business Process Rules
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Proprietary Network, Partner Network or Hybrid?
Individual consumers
Partner websites
Clients
??Arguments based on:
•Economics
•Branding
•Data quality
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Arguments for Proprietary Network
•Economics•Average case: Preferred to partner network if R > $6MM per month
•With 2 messages/week (each generating 25cents), need over 3 million members
•Optimistic case: Preferred to partner network if R > $4.16MM per month•With 8 messages/week (each generating 25cents), need over 520,000 members
•Branding•If defend consumers against marketing abuse, then serve consumers
•Data quality•Those registering at yesmail.com likely willing to provide rich data and are receptive to promotional emails
Individual consumers
Clients
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Arguments for Partner Network
•Economics•Proprietary network: If spend $3MM on banner ads (CPM = $30 and CTR of 1%), grow by 1 million members per month•Partner network: With 80 partners, each with 25,000 new registrations per month with 50% opt-in, get 1 million members per month
•Branding•Associate with well-liked brand•Avoid mass advertising to drive traffic to yesmail.com
•Data quality•Quality data if users are involved in partners’ sites/brands•Where register is additional important data
Individual consumers
Clients
Partner sites
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Member and Client Benefits
• Members– Valuable promotions
– Really avoiding spam?
• Clients– eTrack
– Flat rate of 25 cents per email
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Attitudes toward Permission vs. Unsolicited E-mail
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Future of Agents such as Yesmail?
• Potential pitfalls:– Trust– Demand– Feasibility
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Yesmail Update
• Summer 2000: commit to using double opt-in to avoid appearing on Maps’ (Mail abuse prevention system LLC) list of spammers
Date Membership size
Average monthly growth
Partner Network size
May 2000 11 million 665,600 104
Feb 2001 14 million 1 million NA
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Rich Media E-Mail Ad
Sent to 100,000 prospects using yesmail.com list
165,000 responses
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Conversion Costs Across Medium
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Death of Banner Ads?Paid vs. In-House Ads
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Banner Ads
Full CRM = $28.28
Vertical banner CRM = $54.17
Half CRM =$26.51
Micro CRM = $16.94
New: Skyscraper
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Greatest Difficulties in Adopting Online Advertising
4.0
2.93.4
3.93.3
4.2
2.5
3.4
0.0
1.0
2.0
3.0
4.0
5.0
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Agency Grand Total
Greatest
Least
Average of responses on 5-point scale where 1 = least problematic and 5 = most problematic
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Ad Strategy Across Industries
Branding
Behavior-based
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Banner Ads Enhance Awareness and Image
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B2B Advertising
Share of advertising impressions = 7%
Number of B2B advertisers making up 50% of online advertising = 18
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Concentration of B2B Advertising and Work Users
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Reaching Target Audience
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Online Media Reveals Three Action Profiles
Qualified prospects
Traditional advertising targets a qualified audience
Online advertising targets readyand motivated consumers
All consumers All consumers
Ready
Motivated
Qualified prospects
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Different Media Approaches for Different Profiles
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Optimization
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Sample Report from Ad Server Avenue A