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Why We're Not Seeing More Online Ad Revenue -- Part II

Posted on Monday, June 07, 2010 at 3:18 PM

The story gets worse. More reasons why online ads just aren't working for too many advertisers.

By William Dunkerley

In Part I, I described some of the qualities of good advertising that perhaps most online ads lack. Now, let's consider some of the qualities of online ads that are actually off-putting.

The forced, repeat exposure of an unwanted ad that was discussed in Part I deserves prominent mention. You know, that's the serving of ads over and over again, sometimes on a rotating basis, sometimes in a position that interferes with reading the content.

Another thing is the placement of ads. Often online publications will try to cram as many ads as possible toward the top of their front pages. In some cases, these placements may boost the click-through numbers. However, when it comes to overall advertising effectiveness, ad position is known to have little impact. For a long time there has been a lot of misunderstanding about this. Many advertisers, for example, have valued right-hand pages in a print publication over left-hand pages. Likewise with the front of the book over the back of the book. Research has shown, however, that with few exceptions (like the back cover, for instance), position in the publication has almost negligible impact on effectiveness.

Perhaps the worst examples of online ad positioning are the in-your-face ads that you can't avoid. They include ads you have to click away in order to reach the publication in the first place. Then there are the flash ads that pop on or walk onto the page when you try to read further, as well as those ads that follow you up and down the page as you scroll. They require clicking away, too. Special mention should go to ads that emit intrusive sounds that were never invited by the reader. These ads may be clever demonstrations of the designer's technical prowess. But, they embody an enormous potential for annoying the audience of any publication. The idea that annoying your potential customers is a good way of soliciting their business seems quite counterintuitive.

Is it any wonder why online advertising doesn't work? Either the ads are too small to count, hard to find when you want to, or so intrusive that they annoy. Do you have any lingering doubts about why we're not seeing more online ad revenue?

When an Industry Does Itself In

The current predicament of online advertising may sound problematic. However, the future doesn't seem much better. In fact, there are distinct perils ahead.

To appreciate this, consider the plight of the telemarketing industry. As recently as the 1980s, it offered an up-and-coming way of soliciting business. In 1987, International Telemarketing Expos were held in New York, Los Angeles, and Chicago. Under the banner of "Plan Now For Your Future!" they featured educational seminars and exhibits to help attendees sharpen their skills for this emerging field.

Now, twenty-three years into the future, where is the telemarketing industry? It has been practically legislated out of existence! Why did that happen? It happened because it annoyed, irritated, and bamboozled its audience.

Now It's Happening to Online Advertising

I've already described for you how online advertising has annoyed and irritated its audience. But bamboozled? That brings spam to mind. The whole unremediated problem of spam, however, speaks for itself. It still cries out for a serious legislated solution. Now, though, I'm talking about what is considered by advertisers and content providers to be legitimate advertising.

To illustrate the problem with so-called legitimate online advertising, we performed a couple of experiments at STRAT. We went to Google.com and did a search on the term "ostrich diapers." We were served ads for several vendors, including the retailer Target. Proceeding to the Target website, we found no "ostrich diapers." A phone call to the retailer confirmed that they sold no "ostrich diapers."

This exaggerated example just goes to illustrate a problem. Many of the ads consumers are served online are for products that the advertisers are not selling. Sometimes, the text of the ad is even dynamically configured to contain the name of the product that the advertiser is not selling. These ads are using the words consumers are searching for. But the advertisers have no intention of supplying the "ostrich diapers," or whatever. They're just trying to get a click through by any means. Misleading consumers is not good business.

On another occasion, we went to Google.com and set up an AdWords campaign for a webinar. We included in the campaign design exposures to both Google's "Search Network" and "Content Network." The latter involves ads placed by Google on the websites of others that Google deems to be relevant. The "content" click-throughs exceeded those from "search" by three times. In analyzing the results, we looked at where the traffic came from geographically. It was surprising to find that a very disproportionate number of clicks came from Chinese addresses, even though our advertised webinar would have little utility for that audience segment. Then, we randomly sampled two website addresses on which our ad was served. When attempting to visit those sites, the first address returned the message "Directory Listing Denied," the second said in Portuguese, "under construction." These non-existent sites were locations represented to us as relevant locations from which our ad had been served and clicked upon. After bringing these problems to Google's attention, the situation still remains unresolved, now weeks later.

When a leading online provider like Google provides an advertiser with nonsensical and even misrepresented results, it does not bode well if you are trying to "Plan Now For Your Future!"

What Can You Do About This?

The spam, misleading, and potentially fraudulent advertising problems need to be addressed by a combination of industry groups, legislators, and law enforcement agencies.

However, there are things you can do now with your online publication and with your advertising sales. Here are a few recommendations:

1. Get off the metrics bandwagon and instead build a quality online audience of people who will be good prospective buyers for your advertisers. I'm not suggesting that you ignore metrics. Just subordinate them to the goal of building a readership that consists of prospective buyers.

2. Don't offer advertising modalities that will have a high probability of annoying your audience. If you do, it will work against you and your advertisers in the long run. Think how annoyed a print reader would be if he had to unstick an ad from the next page in order to continue reading. Why should we expect online readers to be any less annoyed? Avoid annoying the readers.

3. Do offer advertisement sizes that are will be perceived as significant. Consider that small banner ads will have a small impact on readers. In print, a full page ad is a full page, period. If your online publication is in PDF or one of the page-flip formats, then, a page is still a page. But, if your publication is in HTML, there is no standard page size. What a reader sees before her will depend upon the size of the monitor, the screen resolution, and the size of the browser window. However, you should be able to obtain some statistical evidence from your server to indicate what is the most prevalent monitor configuration used by your visitors. Consider whatever size fills that screen to be the equivalent of a full page ad. Figure out how many pixels that represents in order to specify the dimensions for advertisers. Encourage advertisers to use that size.

4. Give the advertisements a fixed place in your publication so that readers will be able to return to them at will. Making them impossible to find again deprives your advertisers of a very valuable form of repeat exposure.

Try implementing these four recommendations, and see if your online ad revenue doesn't take a turn for the better!

William Dunkerley is principal of William Dunkerley Publishing Consultants, www.publishinghelp.com/consultant.

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