Archive for July, 2009

Advertisers Moving to Performance-based Models

Friday, July 31st, 2009 by Heather Carr

Online advertising has changed since its inception. Advertisers have moved away from links and banners in search of tangible results. What they wanted was a guaranteed return on their investment. What they found: performance-based advertising.

pie

The IAB Internet Advertising Revenue Report released this past March reflects the trend toward performance-based advertising solutions. Among the report’s findings were a 6 percent increase in performance-based revenues over the past year, while CPM or impression-based advertising revenues decreased by six percent. The approximately 4 percent of 2008 full year revenues priced on a hybrid basis represented no change over 2007 figures.

The trend toward performance-based advertising is likely due to the model’s ability to alleviate advertising dollars wasted on an ineffective ad. In turn, advertisers are more comfortable putting their advertising funds into cyberspace, knowing that when they’ve found the right combination, they will gain the return they’ve been looking for.

Tags:
Posted in Advertising, Performance-based Media | No Comments »

Email Still Tops When It Comes to Performance

Friday, July 24th, 2009 by Heather Carr

graph

Email tops the list once again as the strongest performing advertising channel in Datran Media’s third annual marketing and media survey released earlier this year.  Of the over 3,000 industry executives from Fortune 1000 brands and leading interactive agencies surveyed, an overwhelming 80 percent listed email as a strong performer, with search ads and display ads taking second and third honors.

Email remains a high performer because users are willing to spend time reading promotional email.  According to the View from the Inbox 2009 survey conducted by Merkle, permission email accounts for about a quarter of all time spent with email, topped only by email’s primary function of communicating with friends and family.  Just over two-thirds of users surveyed considered themselves generally open to receiving promotional messages through their email accounts.  Irrelevancy and high frequency were the most likely reasons cited for opting out.

The fact is, permission email works.  To tap into that success, it’s vital for companies to round up the email addresses of willing current and potential customers.  With phishing scams reaching so many, wary consumers are on the look-out for unknown email sources.  A whopping 84 percent of those participating in the Merkle survey looked to companies with which they had an existing relationship as a source of reassurance that the email was legitimate.

Tags: , ,
Posted in Advertising | No Comments »

BusinessWeek is on the block and the industry is shocked. But why?

Tuesday, July 14th, 2009 by Melissa Chang

businessweek magazineApparently the media industry is “stunned” that BusinessWeek is for sale. Really? Stunned?

Today’s article in B2B Media Business cites the following:

  • - BusinessWeek lost $85 million in 2008
  • - BusinessWeek has already lost $20 million in 2009
  • - BW’s ad pages declined 17.2% in 2008
  • - This year, BW’s ad pages have declined 36.8% compared to the same period last year
  • - BusinessWeek’s ad pages have dropped 69% since their high point in 2000
  • - Print ad revenue has fallen 59% in the same time period

Why are people stunned that McGraw-Hill would want to offload a business unit that is bleeding so severely? I understand that BusinessWeek’s brand is valuable and important, but most companies – including McGraw-Hill - can’t absorb $80 million in losses year after year.

I suppose that the shock and dismay people feel at the loss of well-established print entities shouldn’t surprise me. Just look at the outrage that people felt at the thought of the Boston Globe possibly closing its doors, even though that publication is on track to lose $85 million this year.

Publishing and media companies that continue to shrink are going to have to figure a way out of their declines. McGraw-Hill will likely be able to unload BW because the brand is strong and there will be buyers. But most companies aren’t going to have the option of selling.

The B2B Media Business article says that McGraw-Hill “has long touted a model based on data businesses that provide steadier revenue streams than ad-supported properties.” It’s too bad that McGraw-Hill wasn’t able to figure out how to turn BusinessWeek into a data business before being forced to sell.

At this point, publishing and media companies need to be moving to diversify their business models, and it’s an easy jump to add additional data-driven models to the mix. To do so, publishers need to begin collecting data on their audiences and using that data on their audiences to provide more value for their customers. And they need to do both today or they may suffer a fate worse than sale.

Tags: , , , ,
Posted in Advertising, B2B, Data, Magazines, Print publishing, Recession, Traditional Media | 1 Comment »