Essay

Kristyn O’Reilly
S2625659
1501ART
Essay
Due date: 11/05/2007

It goes without saying that the introduction of the internet has affected day to day life. The internet is a vast computer network linking smaller computer networks worldwide. The internet includes commercial, educational, governmental, and other networks, all of which use the same set of communications protocols. (Online Dictionary, 2007, paragraph 1) Many businesses now use the internet to advertise their product or service. This is due to the massive growth in internet usage.Advertising is the act or practise of calling public attention to ones product, service, or need by paid announcements in newspapers and magazines, over radio or television, or on billboards, etc. (Online Dictionary, 2007, paragraph 2) The object of this essay is to analyse the effectiveness of advertising on the internet. This essay will look at the steady growth of the internet, advertising on the internet and consumer thoughts of internet adverts and their effectiveness.

The internet is growing and expanding everyday. People are becoming more open to the internet and some have even said the net has become mainstream, a normal part of everyday life. According to the Australian Bureau of Statistics (2006) 60% of Australian households have access to the internet. 65% of internet users claim to use the internet for personal reasons making this the most popular purpose, followed by work or business purposes. The Australian Bureau of Statistics also found the main reasons why some people that don’t use the internet are; 24% feel they have no use or need for it, 23% have a lack of interest and 19% felt costs are too high.The Internet has enabled consumers to become more involved in the business industry. The internet allows consumers to ‘gather pricing information, participate in product design, explore promotions, consummate sales, arrange delivery, and retrieve post-purchase support.’ (Korgaonkar & Wolin, 2002, page 191)The effectiveness of advertising on the internet is difficult to measure correctly, one could measure click through rates of adverts, or purchases made on the internet, but the results may not be due to online advertising. The results may be due to accidentally clicking onto an advert or chance. Web user’s perceptions are the best measure of efficiency. According to Korgaonkar and Wolin (2002) in their study of web usage, web users generally have positive perceptions of online advertisements. It has also been shown in a case study conducted by Illingworth, Williams and Burnett (2002) that large organisations have benefited from online advertising with an increase in membership, increased public awareness and increased enquires. In a study conducted by Previte (1999) it was found that ‘internet advertising promotes competition’ this highly benefits the consumer as prices may change due to this new found competition. New studies indicate that internet usage is at a major tipping point (Moore, 2001) which is a major advantage for online marketing, the more people that use the internet, the more advertising that is wide spread.

Often marketers use a technique of bundling, this involves advertising a range of products in one advertisement. This has proven successful in traditional types of advertising however, in internet advertising it has been shown that bundling should not be used as extensively. (Yuan, Caulkins, & Roehrig, 1998, page 678) This conclusion is due to consumers having a great deal of control over advertising exposure on the internet, as it is up to the consumer to seek additional commercial content. (Schlosser, Shavitt & Kanfer, 1999, page 35) Internet usage differs from developed and less developed countries. There are many reasons for this difference, these include economic development, cultural factors, individualism and uncertainty avoidance. (Hermeking, 2005, page 1) It therefore is important to use alternate advertising techniques in these areas.According to a study by Schlosser, Shavitt and Kanfer ‘internet advertising is perceived as informative but not entertaining, especially in comparison to advertising in general.’ Therefore the weakest aspect of internet advertising is its ability to deliver entertainment, which could encourage purchase.

Although it has been argued that internet advertising is ‘uninformative, unfocused and forgettable’ (Goldsmith & Lafferty, 2002, page 318), it would appear that several studies have proven this theory wrong. Statistics demonstrate that internet sales are increasing. In 2000 internet sales reached ’27.3 billion in the US’ (Korgaonkar & Wolin, 2002, page 192) If companies use the internet efficiently it can lead to a decrease on spending in the “main media advertising, direct mail, sponsorships and public relations’ (PR newswire, 2007) sectors. This decrease can lead to a more profitable organisation as trends indicate that the internet is a ‘low cost and high benefit solution to marketing and communications.’ The internet is a cost effective way to promote company awareness and market organisations. (Illingworth, Williams & Burnett, 2002, page 280) It has also been proven that internet adverts ‘increase loyalty and may be more effective in brand alliance than TV or print ads.’ (Korgaonkar & Wolin, 2002, page 192)

The internet has caused a major shift with technological advancements which has caused advertisement to move from paper-print to online. Advertising has, and continues to expanded and change as society changes this had lead to the internet becoming mainstream in our day to day lives. The effectiveness of online advertising is difficult to measure, just as the effectiveness of many types of advertising are. From the research conducted, it is obvious that internet advertising has an effect on consumers however, it is important to realise that successful marketing programs require a mix of all marketing elements, rather than just focusing on individual element, such as the internet.

References

Australian Bureau of Statistics (2006) ‘Household Use of Information Technology, Australia’www.abs.gov.au/Ausstats/abs@.nsf/lookupMF/ACC2D18CC958BC7BCA2568A9001393AE
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Goldsmith, R and Lafferty, B (2002) “ Consumer response to web sites and their influence on advertising effectiveness” Journal of Internet Research: Electronic Networking Applications and Policy, Vol 12, pages 318-328
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Hermeking, M (2005) “ Culture and Internet Consumption: Contributions from Cross-Cultural Marketing and Advertising Research” Journal of Computing-Mediated Communication Vol 11, page 0
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Illingworth, L; Williams, D and Burnett, S (2002)‘The costs and benefits of the Internet as a marketing and communications tool: attitudes, perceptions and experiences within the non-profit environment sector in Scotland’
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Korgaonkar, P and Wolin, L (2002) “Web usage, advertising, and shopping: relationship patterns” Journal of Internet Research: Electronic Networking Applications and Policy, Vol 12, No 2, pages 191-204
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Moore, N (2007)’Online has finally gone Mainstream’ B & T Weekly 2nd February
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Online Dictionaryͣ. “Advertising”, retrieved 26th April 2007, fromwww.dictionary.reference.com/browse/advertising

Online Dictionaryͣ. “Internet”, retrieved 26th April 2007, fromwww.dictionary.reference.com/browse/internet

Previte, J (1999)’Internet Advertising: An Assessment of Consumer Attitudes’pages 199-209
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Schlosser, A; Shavitt, S and Kanfer, A (1999) “ Survey of Internet users attitudes towards internet advertising” Journal of Interactive Marketing, Vol 13, pages 34-54
Retrieved 17th April 2007 from ProQuest database.

’Small business + Web = Increased Local Sales! Internet marketing isn’t just for global business; new Small Business Mavericks site introduces small and mid-sized businesses to internet tricks and techniques’ (2007) PR Newswire, 30 January
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Yuan, Y; Caulkins, J and Roehrig, S (1998) “The relationship between advertising and content provision on the internet” European Journal of Marketing, Vol 32, No.7/8, pages 677-678
Retrieved 24th April 2007 from Emerald database