Chapter 11: The Right Internet Advertising Format (RIAF)

Payam Hanafizadeh and Mehdi Behboudi

1 INTRODUCTION As these statistics indicate, the four major types of Internet advertising are: 1. display ads (21%) including banners, hypertexts, and skyscrapers. 2. rich media (7%) including pop-up, pop-under, and interstitial ads. 3. sent s (2%). 4. digital video (3%).

2 INTRODUCTION Iranian companies as new adopters of Internet advertising (Hanafizadeh et al., 2012) need to evaluate the benefits of various formats in selecting the best formats of Internet advertising for their needs.

3 INTRODUCTION Hence, the present study is designed to provide some insights for those companies by gathering first-hand information to answer the following questions: 1. How can Iranian marketers find the right format of Internet advertising? 2. Different products need to have different ad formats; how this can be done? 3. Which variables affect marketers’ decisions in advertising a certain product on the Internet?

4 LITERATURE REVIEW Briggs & Hollis, 1999; Dahlen, 2001; Dahlen & Bergedahl, 2001; Brown, 2002; Rodgers, 2002; Xie et al., 2004; Burns & Lutz, 2006; Rodgers, 2007; Breuer et al., 2011 Online advertisement format Broussard, 2000; Goldsmith & Lafferty, 2002; Danaher & Mullarkey, 2003; Manch et al., 2006; Calder et al., 2009; Brettel & Spilker-Attig, 2010; Breuer & Brettel, 2012 Online advertising Effectiveness Heiligtag & Xu, 2007; Hanafizadeh et al., 2012 Online advertising adoption Cho & Cheon, 2004; Kelly et al., 2010; Hadija et al., 2012 Online advertising Avoidance Ngai, 2003; Heidarzadeh et al., 2011 Selection website for Internet advertisements Ducoffe, 1996; Edwards et al., 2002; Wolin & Korgaonkar, 2003; Sundar & Kim, 2005; Tan & Chia, 2007; Yoo, 2008; Wang, Y. & Sun, 2010; Mc COY et al., 2012 Attitude toward Online advertising Rodgers, S., & Thorson, 2000; Liu & Shrum, 2002; Chondon et al., 2003; Griffith & Chen, 2004; Ko et al., 2005; Ha & Ma CANN, 2008 Interactivity

5 THEORETICAL BACKGROUND Product Involvement Product involvement has been reported to be a major determinant of the consumer’s behavior and response to a certain ad (cf. Celsi & Olson, 1988; Laurent & Kapferer, 1985; Zaichkowsky, 1985).

6 THEORETICAL BACKGROUND Product Involvement Advertisements of low- or high-involvement products differ in advertising appeals. Research findings have demonstrated that rational appeals can help market high-involvement products whereas emotional appeals benefit low-involvement products (Wills Samli & Hacobs, 1991). involvement_product_would_use_various_IMC_tools_differently_than_a_marketer_of_a_high-involvement_product

7 THEORETICAL BACKGROUND Product Involvement In this regard, Vaughn (1986) takes four types of involvement (high rational, high emotional, low rational, and low emotional involvement) into account and believes them to be the determining features of a given product or service to be considered when selecting the right advertising.

8 THEORETICAL BACKGROUND Product Involvement Grouping products based on four types of involvement has a positive impact on determining the right format of Internet advertising.

9 THEORETICAL BACKGROUND Internet Users In this respect, Internet users are divided into three groups: heavy users, medium users, and light users (Korgaonkar & Wolin, 2002).

10 Internet Users THEORETICAL BACKGROUND In fact, people use the Internet not only to retrieve information, but also to entertain themselves (Ko et al., 2005; Korgaonkar & Wolin, 2002).

11 Internet Users THEORETICAL BACKGROUND Marketers’ task is to recognize the right user as each user has a unique behavioral reaction to the Internet (Ko et al., 2005).

12 THEORETICAL BACKGROUND Internet Users Segmenting and targeting users based on three types of users positively impact the determination of the right format of Internet advertising.

13 THEORETICAL BACKGROUND Advertising Type According to Thorson (1996), all advertisements can be classified into one of the five basic categories: product/service, public service announcement (PSA), issue, corporate, or political.

14 THEORETICAL BACKGROUND Advertising Type Traditional advertising studies have shown that PSAs outperform other types of ads in terms of credibility and perceptions of social responsibility (Haley & Wilkinson, 1994).

15 THEORETICAL BACKGROUND Advertising Type Grouping advertisements based on the five types of advertisements has a positive impact on determining the right format of Internet advertising.

16 THEORETICAL BACKGROUND Pull or Push Strategy The pull strategy involves those manufacturers who use advertising and consumer promotion as a means to persuade the intermediaries to order the product.

17 THEORETICAL BACKGROUND Pull or Push Strategy When users have a high level of loyalty, they tend to look for the corporate product. Therefore, the only thing a manufacturer needs in such occasions is to design a website and wait for its users (Turban, King, Viehland & Lee, 2006, pp ).

18 THEORETICAL BACKGROUND Pull or Push Strategy In the push strategy, the manufacturer uses sales promotions to persuade intermediaries to carry, promote, and sell the product to end users. In this situation, various tools are applied to push the users toward a company’s website.

19 THEORETICAL BACKGROUND Pull or Push Strategy Different types of advertising strategies need to have different Internet advertising formats.

20 THEORETICAL BACKGROUND ICT Condition According to the report of Iranian Ministry of Telecommunication and Information Technology (ictkey. ir, 2010), in Iran the low-speed connection with a transfer rate of 56 kbps is mostly suitable for home connections and the high-speed connection with a transfer rate of 128 kbps is mostly used by organizations and institutions.

21 ICT Condition THEORETICAL BACKGROUND The ICT status of the target market is a determinant of the selection of the right format of Internet advertising.

22 THEORETICAL BACKGROUND Advertising Features These features are divided into two categories: 1.Subjective features 2.objective features 013/04/11/facebook-introduces-new-ad-targeting-feature.aspx

23 THEORETICAL BACKGROUND Advertising Features  Objective ad features include typeface, appeal type, number of sentences, movement and interactivity, sound level, sound clarity, telepresence, realism, and number of choices.  Subjective ad features include excitement, flow, current information, attitude toward ad, and friendly navigation (Thorson & Leavitt, 1986).

24 THEORETICAL BACKGROUND Advertising Features  Subjective features of advertising affect the selection of the right format of Internet advertising.  Objective features of advertising affect the selection of the right format of Internet advertising

25 CONCEPTUAL MODEL The right format of internet advertising (RFIA) ICT condition Right format of Internet advertising, RFIA Product Advertising type Strategy User Subjective ad features Objective ad features

26 Methodology In order to identify variables affecting right format of Internet advertising, 45 previous studies in the areas of Internet advertising, e-commerce, online marketing, and e-business were reviewed. According to this review, 31 indicators confirmed by most researchers were identified and categorized into eight constructs on the basis of confirmatory factor analysis. Name=online-advertising-the-rise-of-pops

27 Data Analysis In general, LISREL software has three main applications: 1.Confirmatory factor analysis. 2. Path analysis. 3. Goodness of fit for the hypothesized research model. As the present study has just one latent endogenous variable, the first and third applications were used.

28 Research Findings The construct of product involvement with a path coefficient of 0.43 was identified as the most effective variable, followed by user type (0.37), ad type (0.24), subjective ad features (0.17), strategy type (0.11), ICT condition (0.09), and objective ad feature (0.04).

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