1. Copyright © 2012 Pearson Canada Inc. CHAPTER 12 Interactive Media 12-1

2. Copyright © 2012 Pearson Canada Inc. Learning Objectives  Describe the various elements of internet communications  Identify the key organizations that constitute the online advertising industry  Evaluate the various advertising models available to marketing organizations Continued… 12-2

3. Copyright © 2012 Pearson Canada Inc. Learning Objectives (cont.)  Identify key aspects of online audience measurement systems  Assess the potential of the internet as an advertising medium  Describe and apply various models of pricing and buying online advertising  Assess the role of social media in the marketing communications mix 12-3

4. Copyright © 2012 Pearson Canada Inc. Interactive Media  Technology is changing how marketers think about the media.  In the digital universe, control has shifted from the advertiser to the customer.  The Internet and mobile phones allow viewers to choose when, where and how they watch.  Internet / mobile phones are participatory media; traditional media is interruptive. 12-4

5. Copyright © 2012 Pearson Canada Inc. Interactive Communications The world’s digital revolution is being led by Canadians, who now consume 28% of their media online.  In 2009 online ad revenues reached $1.8 billion, up from $1.1 billion in 2006.  Interactive communications is more about engagement than it is about reach and frequency. 12-5

6. Copyright © 2012 Pearson Canada Inc. Digital Reach, Consumption and Behaviour  The Internet has reached mass media status  More than 80 percent of Canadians have Internet access at home  Internet users average about 17 hours a week online  43% of Canadians have ordered goods online.  Wireless communications are revolutionizing consumption patterns once again.  Smartphones are now a mainstream method of accessing information through to the Internet 12-6

7. Copyright © 2012 Pearson Canada Inc. Online Advertising Industry Sellers Buyers Ad Agency/ Web Design Measurement companies Service companies facilitate effective use of online advertising. Traditional ad agencies have acquired digital-media agencies or integrated them into organization. Boutique shops pioneered online advertising. Advertisers, agencies buy space. Publishers, ad networks sell space. 12-8

8. Copyright © 2012 Pearson Canada Inc. Interactive Media Planning Establish objectives and then choose interactive media options from:  Internet  Mobile communication device  Video games  Social media networks 12-9

9. Copyright © 2012 Pearson Canada Inc. Interactive Communications Strategy Internet consumers voluntarily visit websites with content that interests them, making it possible to target on an individualized basis:  Demographic variables  Behavioural variables  Geographic variables 12-10

10. Copyright © 2012 Pearson Canada Inc. Interactive Communications Objectives  Create brand awareness  Build and enhance brand image  Offer incentives  Generate leads  Conduct transactions 12-11

11. Copyright © 2012 Pearson Canada Inc. Internet Advertising Options Search  an advertiser’s listing is placed alongside search results in exchange for paying a fee each time someone clicks on the ad. Display  advertisers place banner ads on websites of interest to the target audience Rich media  includes animation, sound, video, and interactivity; often referred to as animated banners Continued… 12-13

12. Copyright © 2012 Pearson Canada Inc. Internet Advertising Options (cont.) Video  video ads offer more emotional impact than other forms of online advertising and are familiar (like TV) Sponsorships  advertiser commits to an extended and integral relationship with another website Permission-based email  permission-based email, in which a user chooses to receive messages from a particular advertiser, is growing quickly. Continued… 12-14

13. Copyright © 2012 Pearson Canada Inc. Internet Advertising Options (cont.) Webisodes  unlike television commercials, webisodes focus more on creativity in order to engage users. Company and brand websites  traditional media combined with effective website content give an advertiser ample opportunity to tell the whole story. 12-15

14. Copyright © 2012 Pearson Canada Inc. Advantages of online advertising  Tracking and Measurement  Targeting capability  Broad Reach possibilities  Depth of Content  Timing – “always on”  Interactivity and action 12-16

15. Copyright © 2012 Pearson Canada Inc. Disadvantages of Online Advertising  Low click-through rates  Consumer expectations  Privacy concerns 12-17

16. Copyright © 2012 Pearson Canada Inc. Internet Advertising Rates and Media Buying CPM  CPM is the price charged for displaying an ad 1,000 times. Pay-for-performance  Based on cost-per-click, a model which is shrinking. Flat fee  a set amount for the length of time the ad appears on the site. 12-18

17. Copyright © 2012 Pearson Canada Inc. Mobile Communications Targeted advertising is possible through text messaging, video messaging, cell-phone applications, and online video games. Continued… 12-19

18. Copyright © 2012 Pearson Canada Inc. Mobile Communications (cont.) Text messaging  Canadians text an average of 88 million messages every day  For marketers looking for mass market reach, text messaging is a viable way to deliver the message. Video Messaging  Video messaging is the next generation of smartphone communications.  Marketers are excited about video messaging, due to its intimacy and immediacy. 12-20

19. Copyright © 2012 Pearson Canada Inc. Video Game Advertising “Advergaming”  In terms of advertising in video games, an organization can go in two directions: create its own branded game or place ads in commercially sold games.  An irony of video game advertising is that gamers expect to see ads in games and are receptive to their presence. 12-21

20. Copyright © 2012 Pearson Canada Inc. Social Media Network A social network connects people with different types of interests at one website.  The growth and development of social networks is changing the way in which marketers view their brands, their customers, and the media.  The reach of social networking and blogging venues is growing at twice the rate of other large drivers of Internet use 12-22

21. Copyright © 2012 Pearson Canada Inc. Types of Social Networks Broad Based Sites  Includes Facebook and LinkedIn Niche Social Networks  For users who feel overwhelmed or lost in the shuffle of the broad-based sites. 12-23

22. Copyright © 2012 Pearson Canada Inc. Benefits of Social Media Marketing  46% of social media users recommended or discussed a product or brand on Facebook  44% have done the same on Twitter.  30% of respondents said they learned about a new product, service or brand from a social networking site  25% have gone directly to an online retailer or ecommerce site after learning about a new product or brand. 12-24

23. Copyright © 2012 Pearson Canada Inc. Consumers Control Social Media  Brand democratization  when control of the brand message switches from the marketer to the consumer.  Consumer-generated content  content created by consumers for consumers.  Crowdsourcing  when a company invites the public to participate in the marketing of its brands. 12-25

24. Copyright © 2012 Pearson Canada Inc. Types of Social Network Advertising and Marketing Communications  Direct advertising on a social site  Brand page or fan page  “Advertising from a friend” network  attempt to mobilize, manage word of mouth  Corporate blogs 12-26

25. Copyright © 2012 Pearson Canada Inc. Measuring Advertising on Social Networks Interaction Rate  proportion of users who interact with an ad Time Spent  length of a specific visit or session Conversation Reach  number of unique visitors per month to all sites related to the conversation in which the advertiser is participating Conversation-Relevant Links  The number of links to and from content that contains phrases from sites identified as part of the client’s campaign 12-27