Six Pixels of Separation - The Blog
December 9, 200811:52 PM

Banner Advertising Is But One Small Component Of Digital Marketing

When people talk about online advertising, they're really talking about banners ads (or display advertising). If media companies don't like the idea of trading analog dollars for digital pennies, why don't they focus on the entire Digital Marketing enchilada and not just the online advertising?

Banners ads are not the revenue generation model for the online media of future. Even when the first banner appeared on HotWired in 1994 (thank you, AT&T), people's first reaction was not to click, but to ignore. Up until that point, it looked like the Internet was going to be a different type of media and, potentially, even one that would be free of interruption-based advertising. So much for that idea. Instead media companies saw this channel as another place to plaster their messages.

But, in the midst of that, several other interesting and powerful digital marketing channels arose. Search, e-mail and affiliate marketing, and the ability to create very powerful content as media (be it Blogs, Podcasts, online video, etc...). All of those channels are multi-million dollar opportunities to grow a business and to become much more effective at Marketing, yet when we hear about Digital Marketing, the default is think about banner ads.

When we shift that first impression, we change the landscape.

Just like the mass media, the online media is controlled by publishers and agencies. This is what makes up the online marketing channel. People with big properties along with the audience and inventory to help an advertiser reach a bigger target market. The trick is that publishers need to convince advertisers to buy space based on how many "eyeballs" they can deliver and how that stacks up against their traditional media buy. The discussion goes something like, "you're going to get X amount of people with your TV buy, and I can deliver X amount of people in the online channel as well."

Did you ever see a mass advertising campaign that was supported online with e-mail and affiliate marketing only?

Maybe that's the issue.

People have been crying about the death of the banner ad for a long while. Just today, Marketing Charts had an interesting news item titled, No Improvement on Horizon for ‘Standard’ Online Advertising, which stated: "A slow-to-no growth forecast in the US for 'standard' components of the interactive advertising market - such as banner, display and pop-up ads - is not cyclical and shows no signs of improving quickly, even if the nation’s economy starts to move upward and out of recession, according to a forecast report from Borrell Associates... 2009 will be the first year since the start of century in which banners, pop-ups, and interactive display advertising overall will show little or no growth, and may likely decline."

So, on the one hand we have traditional media and advertising agencies banking on digital for their future, but on the other hand, the area that is getting the most attention is the one with no growth and possible decline.

Do we have to make the other digital marketing channels more sexy or do we sit back watch them all blow their brains out on trying to figure out how to sell more banner ads?

By Mitch Joel


Comments Comments Feed
  • Posted by Michael
    Mitch Joel

    It's pretty depressing, actually. Newspapers are possibly one of the few environments in which banner ads could be made to work (and they CAN be made to work), but they're still doing them wrong.

    I guess that's what happens when you're in the middle of one revolution, fighting with consultants who still think they're in the LAST revolution working for people still trying to ignore the revolution prior to that.

    Reply
  • Posted by Amod Munga
    Mitch Joel

    I believe it behoves every marketer worth his paycheque to suggest any and every alternative to banner ads before capitulating to the client's ridiculous demands for same.

    We need to educate clients that there are other options that you cannot treat digital solely as a clone of TV. Eyeballs aren't enough. Context is everything. It's the difference between converting a sales lead and letting them slide.

    Reply
  • Posted by Stanley
    Mitch Joel

    Yes, banner ads can work better than they do now (see Shop Local: http://www.aboutshoplocal.com/smartmedia.html), but it's still not the future (or even really the present) of digital marketing. I'm also not sure digital marketing is going to become one standardized thing, b/c there's so many opportunities in every niche of the web that it takes something slightly different each time. Furthermore, with every niche comes different strategies, tactics and dialogue. I love standards, they build a base to push innovation forward, but I don't understand why all these marketers are so set on standards, eyeballs and traditional metrics. I guess it's b/c im 22 and grew up in a different age with different technology standards, but that doesn't mean old-time marketers shouldn't be looking at it differently.

    Reply
  • Posted by Jeff Janer
    Mitch Joel

    Banner ads = TV spots; good for creating awareness and linking the < 1% of those who click through to a company's website or microsite.

    CPA (cost per action) advertising - or better yet - interactive ad units that are targeted and actionable (e.g. make a reservation, buy a product, etc.) are measurable and higher value offerings.

    Reply
  • Posted by Matt Tuley
    Mitch Joel

    The best banner ads I've seen are those Apple occasionally runs on the New York Times online front page: the ones where the characters of Mac and PC in a side panel appear to be aware of and interact with the goings-on in a banner across the top. They're clever and, more important, entertaining--not just "Click here to buy our stuff!".

    But are they effective? Dunno. _I_ don't click, but then, I'm already a Mac guy.

    Reply
  • Posted by Stefan Holt
    Mitch Joel

    it's that thing...you know, that thing nobody wants to talk about but yet it exists..and why does nobody talk about it because it's hard to talk about things that scare you. And why does it scare you because it is the unknown.
    The Unknown of doing things differently, of breaking the mold, of taking a unique approach to solving problems.

    Case Study #1 Bailout Fear
    Why did the US govt agree to spend ka-billions (that's my term, nothing webster would like) helping out failing companies?
    Ans: Fear of the Unknown

    Reverse Case Study #2 How did we get to the moon?
    Ans: People were willing to overcome their fear of space.

    And of course ...the HIPPO...
    I think Avinash Kaushik was right on target when he mentioned the HIPPO (HIghest Paid Person's Opinion) in the room. If the HIPPO is fearful of the unknown and co-workers are fearful of the HIPPO. You've got trickle-down-fearonomics and hence, status quo. Continued use of page views/click rates as the standard metric for measuring websites and banner ads as biggest $$$ generator. imho

    Stefan Holt
    http://www.acktiveblog.com

    Reply
  • Posted by Josef
    Mitch Joel

    You may have a case for companies making products or selling services, but what if the site itself is the product? For example, Yelp!, Digg, Facebook or even weather.com?

    If banner ads cease to exist, a lot of these sites will as well. Having a blog or PodCast, as you suggest, won't help them make revenue.

    Interesting that you also use video as an example of the future. How will the costs to produce and distribute be paid for?

    Reply
  • Posted by Rob Cotter
    Mitch Joel

    Banner ads are ubiquitous thus easy to buy. And they're cheap. I believe they only work when they're relevant to a specific audience. In my case, a rock band buys ads on my music ad network. That makes sense.

    Cost Per Action campaigns do work but we only use them in some cases where branded advertising isn't effective (eg with retailers). The big question is though: why should our publishers give cash-rich companies free advertising? This is a scam created by media buyers and marketers. I would imagine that this approach works only on larger scales (see: Google) where one must compete on keywords of all things.

    What I forsee is a return to the magazine format which media buyers love so much. Buy a "full page web page" (interstitials), a "half page" (see: monster ads on NYT), down to the "quarter page" (a 300x250 unit), and so forth. This rotating ad exposure will cede to roadblock/exclusive buys on specific page(s) of given web sites. Well, if I have my way anyway.

    Sure these ideas sound boring but until brands really invest in awesome creative (with companies like Twist Image) then people like me are going to be stuck with average creative. I clearly advocate for better creative, but I can't force dollars out pockets. (For example: It's tough with a client that has a $5000 media budget to spend $5000 on creative.) Most media buyers are keen to get the most possible exposure for the least cost. I believe in the reverse in buying specific niche ads and spending more on creative interaction and usability. Creating experiences, telling stories, etc.

    Also, I think it's going to take companies and brands diving into supporting individual communities. Why cater to fifty different advertisers when I can ask one company for an exclusive weekly or monthly sponsorship? This is going to rattle a lot of smaller advertisers who won't be able to afford the cost of advertising. That being said, it might make them go full circle to evaluate how they're marketing in the first place, thus hopefully in the end being more creative with their marketing techniques in order to achieve legimitate coverage.

    Buying a banner ad won't get anyone a record deal. I suppose that buying any sort of digital campaign might not help either. What I'm advocating is "use whatever works for you" but more importantly in a sense that is experimental on a campaign by campaign basis. A formula will emerge.

    I hope I'm not speaking out of line here; Twist Image doesn't need to advertise. Why? Because of Mitch Joel. You are the face and entire marketing wing of Twist Image. (From what I see from the external view anyway.) And what you do is bring value to the global advertising / marketing / new media communities. And ultimately *that* is what you have and what most messaging lacks: value.

    So coming back to the banner ad question: they do have some inherent value and usefulness (low cost, far reaching, etc). But I can't interact with a banner ad like I can with yourself (see: this comment). Whatever the case, the point is that creative matters and all channels should be explored. It's easy to crunch those numbers afterwards to see what works and what doesn't.

    Reply
  • Posted by Creator
    Mitch Joel

    Oh, Mitch, you make me feel so small! Just kidding, of course.

    I'm not so sure people automatically think about banner ads when they hear about online marketing. But even if it's so, I think very few know how to squeeze the maximum out of their banner campaign.

    Banner advertising is the most popular form of online advertising. It is also the least mentioned in the online advertising "manuals". I mean, you can find hundreds of serious articles talking about blogging, search advertising, SEO, email marketing and so on, but almost no article that treats the banner ads subject thoroughly.

    That's the funny part: almost everyone (ab)use them, but almost no one reads about them.

    Banner ads are made "by ear". And yes, they are not the most important form of online marketing... I have to admit.

    Reply
  • Posted by Ryan Moede
    Mitch Joel

    I think part of the problem with banner blindness may lie in the fact that we're seeing very little creative efforts on behalf of advertisers. It's easy to avoid the traditional ad boxes and focus on the content. But I think you can point to recent work by Apple or Nintendo who are doing really excellent creative that go beyond the traditional banner structure to get the type of performance everyone would like to see from banner ads: http://www.socialmediaworx.com/2008/make-better-ads/

    Reply
  • Posted by Mark
    Mitch Joel

    Whoever said it's about the creative and context is smashing the nail on the head. Banner ads can provide great branding, so long as you put the effort into good creative and putting it in good places. Of course if your creative is all you have, well, just like TV, you will be called out by your customers, who have plenty of methods to let their voices be heard.

    Good article, good comments...

    There's quite a few things within the marketing mix these days, and if you're not making friendly, cool noise in relevant places, and if you're not there when someone is searching for you, and if you're not communicating (with permission and value) to people who want to hear from you, and a million other things (affiliates, content, etc), you're not going to make it in the future.

    Reply
  • Posted by top eleven
    Mitch Joel

    A typical Awale board has two straight rows
    of six pits, called "houses", and optionally one large house at either end.
    s names, the frames, the number of pins knocked down with each ball, and the final scores.
    Having said that, don't wholeheartedly believe advertisements that say game testers get
    paid up to $120 per hour.

    Reply
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