1. 1 Chapter 7 Online Interactive Communications

2. 2 Online Realities 1.Online communications offer a high degree of personalization; messages can be tailored to individuals. 2.The Internet is extremely popular as an information retrieval tool but advertising online is perceived as an intrusion. 3.Online advertising is gradually being added to the IMC mix.

3. 3 Online / Offline Communications Links Corporate Plan Marketing Plan Advertising Plan (Traditional Media) Advertising Plan (Traditional Media) E-Commerce Plan E-Commerce Plan Online Communications Plan Online Communications Plan Offline Purchase Offline Purchase

4. 4 Online Behaviour 1.Consumers visit sites and willingly divulge personal information (database and CRM potential). 2.Online communications is an effective means of reaching diverse demographic target groups. 3.The average family spends 32 hours a week online; 59% of these families have bought online.

5. 5 The Canadian Internet User

6. 6 Internet User Profile The user profile is constantly changing as more and more people sign on.  Equal split between males and females  15 to 24 year olds are the heaviest users  Usage is higher among those with post-secondary education  Higher income households spend more time online

7. 7 Traditional Media vs Online Media Traditional Media Traditional Media 1.Passive in nature 2.Media targets an audience Online Media Online Media 1.Interactive in nature 2.Consumers target content Online messages reach large numbers of people in a cost-efficient manner.

8. 8 Online Communications Opportunities 1.Excellent medium for “telling a story.” 2.Mass customization (personalizing messages) is possible. 3.E-Commerce capabilities produce action.

9. 9 Online Advertising Objectives Online advertising helps achieve numerous marketing communications objectives: Create Awareness Build Brand Image Offer Incentives Generate Leads Provide Customer service E-Mail marketing and E-Commerce potential.

10. 10 Online Advertising The effectiveness of online advertising is measured by: Ad Views (Impressions) Ad Clicks Ad Click Rate Page Views Sites that are visited frequently and for extended periods are said to be “sticky.”

11. 11 1. Online Advertising Options Banner Skyscraper Rectangle Size is important; larger ads get more attention and clicks.

12. 12 Online Advertising Options Animated Banners Animated Banners Pop-Ups Pop-Unders Pop-Ups Pop-Unders Rich Media Rich Media A spinning or animated banner. Ads that suddenly appear on the screen Sophisticated, TV-style ads. Click rates for rich media are significantly higher (3.5%) than static banners (0.5%).

13. 13 Impact of Banner Size Size Brand Awareness Message Association Brand Favourability Purchase Intent Banner1.82.40.30.2 Skyscraper2.73.91.4 Rectangle3.18.52.53.3 Based on this data, large rectangles offer the greatest benefit to advertisers. Source: Advertising Age, January 13, 2003, p. 46.

14. 14 2. Online Sponsorships A sponsorship is a commitment to advertise on a Web site for an extended period. Advertisers are attracted to sponsorships because of Web content. News Business News Sports Entertainment News Business News Sports Entertainment The come to the hook!

15. 15 3. E-Mail Advertising Proper Use Proper Use Improper Use Improper Use Opt-in Lists Permission-based e-mail Sponsored e-mail Invasion of Privacy 3 rd party lists Spam “Permission rented is permission lost!”

16. 16 4. Web Site Communications Presently the best form of online communications. Offline ads encourage visits to sites. Ideal for “telling a story.” Can provide a “fun” experience for the visitor. Good for all products; encourages offline purchases Critically important in B2B markets today.

17. 17 Strengths and Weaknesses Strengths Weaknesses 1.Individual targeting 2.Personalized messages 3.Timing 24/7 4.Interactive (entertaining) 1.Penetration moderate 2.Privacy concerns 3.Consumer perceptions (non-commercial) Online communications are vital for reaching youth targets.

18. 18 #5: On-line Sales Promotion E-coupons Much higher redemption then “unsolicited coupons” because of targeted nature, and the consumer is “opting in” to get the coupon, account for 10% of all coupon use and growing Much cheaper to produce and execute Promotional Banners Sweepstakes

19. 19 #6: Viral Marketing A combination of e-mail marketing and word of mouth Encourages website visitors to forward e- mail to friends There can be privacy issues with this type of communication Marketers must be careful not to invade or exploit customers e-mail

20. 20 Example – L’Oreal Product launch – Ralph perfume Target –15 to 25 year old females What they did: Contest – win a trip for four to South Beach, Miami Sent an email to in-house database (47,500) announcing the contest – you could triple your odds of winning by forwarding the mail to 3 people 55,257 people entered the contest - 60% of entries were from people not on the original database Second reminder email sent to those who did not respond the first time Contest entrants received an on-line coupon Results – 15% increase in sales

21. 21 Instant Text Messaging Cell phones and PDAs are quickly becoming the medium of choice among youth and young adults. 1.Ideal for “guerilla” marketing strategies. 2.Balance is crucial; youth markets are skeptical about too much commercialism. 3.Will probably require an “opt-in” system much like online communications.