Advertising spend on the internet has now overtaken that on radio, we are told, and it won't be long before it leaves behind national press, then television as the nation's favourite marketing medium. According to the hype, we'll soon be spending more time online than watching TV, "silver surfers" are eschewing traditional retirement activities like gardening for the Web, and the only media predicted to grow their audiences in the near future are the internet and, somewhat unaccountably, radio. But that last finding comes from an online poll of heavy internet users and radio listeners by advertising bodies with vested interests. Balance that against a couple of other statistics: the Office of National Statistics reports this month that there is a distinct lack of enthusiasm among the over 65s for the Net; and reliable sources such as the government, BARB, the BBC and the IPA all report that we watch an average of four hours of TV a day, making it still our most popular leisure pursuit.
The national press seems willing to accept the pro-online statistics without applying normal journalistic standards, reporting excitedly on the next advance of the internet and recording that "millions of people" are watching a Webcam of cheese ripening online. As if. Frightened of missing out on the next big thing and searching for a marketing magic bullet, board directors are investing heavily in their internet presence, transferring budgets from offline to online without necessarily applying the same rigorous ROI measures and neglecting proven media channels in favour of appealing new technology.
If the Web doesn't prove as self-sustaining and business-building as hoped, they blame their own lack of technical knowledge. They overlook the fact that there are already more than 110 million websites in the UK alone, with a further 10 million going online annually, and that the average well-travelled Web page looks like a racing driver's overalls, with its confusing mix of pop-ups, banner ads and video streams. So you have to accept this is an extremely competitive channel of communication, where you cannot simply set out your stall, pay for some click-through advertising and wait for the world to beat a path to your electronic doorway. You need to throw something else into the media mix to make your online investment work. Why else, despite their ubiquitous Web presence, would Google and eBay choose to advertise on TV, if not to drive traffic that they cannot generate solely online?
A central shortcoming of online marketing is the lack of agreed, universal and independently-audited Web traffic measures. With direct mail you have postcode data and CPR metrics. With press and radio there are regularly-updated circulation and listenership figures. For TV, the independent BARB TV panel provides reliable ratings for programming and measures viewers for every single advertising spot, a unique capability.
But take website "hits", the term universally used by the popular press and Web amateurs everywhere. For years, I suspect Web designers, engineers and masters have been sniggering behind our backs, because they know a "hit" simply describes a single request for a server to send a file and that every element on a Web page (text, graphics, images, sound) generates yet another hit. Which means that your newly redeveloped home page, with its extra content and features, will instantly trigger 10 or 20 times more hits, without necessarily attracting a single extra visitor.
The number of unique site visitors and page impressions are more useful measures, although these can be exaggerated by search engine robots checking out your site (there are hundreds, apparently), users who land on a page then leave immediately, as well as people and computers generating fraudulent and invalid clicks for various nefarious reasons.
"Click fraud" is already costing online advertisers up to $800m annually in the US, and almost a third have already decreased their online spend, with a further 10 per cent planning to do so unless search-ad publishers can arrive at a proper solution.)
At a recent search engine strategy conference, participants reported experiencing fraudulent click rates of 20-40 per cent, threatening the entire paid search industry, although Google insists invalid clicks remain below 10 per cent. The obvious solution is for independent auditors, with no motive for under- or overvaluing click fraud rates, to provide an audience measurement system—the equivalent, in Web terms, of BARB, RAJAR and ABC.
That aside, the £2bn online ad spend attributed to the UK market seems, to an old marketing man like me, to be predominantly below-the-line, much like direct mail and sales promotions, with search advertising accounting for a massive 58 per cent, three quarters of that on Google. Nielsen research suggests the top 100 online advertisers actually spent some £260m on display ads only, excluding search and affiliate marketing and website building costs, although the IAB puts this at £450m. Whatever, it is salutary to note that the internet's biggest presence, YouTube, which attracts 133.5 million visitors worldwide, only sold around $15m of advertising last year, putting ITV's UK-only ad revenue of £1.3bn into some context.
Then there is the question of whether the internet is a marketing medium at all, or an enabling technology like printing, broadcasting or telephony. Just as you wouldn't attribute every telephone call your business receives to the Yellow Pages, it's shortsighted to allocate every website hit to your online marketing strategy. Every marketing tool you use, be it sales leaflets, PR, e-shots, press ads or TV commercials, will undoubtedly feature your corporate Web address for channelling further enquiries and it's vital to set up systems for identifying the source of online traffic, to determine whether it's click-through activity, brand name searching, online magazines and directories, or just keying in your URL. Otherwise, the online cost-per-response metrics are going to be unduly favourable, just like bus backs are often disproportionately mentioned in customer surveys, simply because they were the last ads seen on the journey to the shops.
Using coded '"anding page'" domains such as .com/tv or .co.uk/radio is one solution, although most people will just enter the standard Web address and not the all-important suffix. There are tracking systems that provide more sophisticated web visitor data than your standard server log, which means the tools are available for more rigorous ROI analysis.
If all this suggests that I am something of a techno-luddite, trying to hold back the inevitable online tide, then I'm not. We have had a Web presence since the earliest days, when newcomers to the net used to wave to each other, and since then have invested, with a greater or lesser degree of success, in trickier graphics, new websites, search engine optimisation, online directories (don't ask), paid search, a blog site, e-shots, even banner ads, but not yet pop-ups or video streaming (perhaps a bit too much for B2B).
It's just that I find the unremitting hype and hoopla surrounding the online advertising industry a little too self-serving.
There's no doubt, the internet is a valuable marketing channel. But building a brand, even an online-only brand, on the Web alone is a costly experience that often fails to work. The golden rule is to ensure consumers or trade customers will recognise your brand name from the offline world, so that you have standout from the competition, which means paying equal attention to less glamorous, yet well-honed marketing techniques, be they trade PR and press ads, direct marketing, radio and TV advertising, even good old exhibitions.
Get the offline and online marketing mix right and you're talking!.
(Postscript: Google has just announced a deal in the US, designed to encourage its online clients to advertise on radio as well. Great minds eh?)
David Gent is MD of advertising agency David Gent Creative www.davidgent.com
Posted 31 May 2007 : Director.co.uk