Advertisers Get Caught in the Web
Advertisers are beginning to catch on to what the World Wide Web can do for them. Quickly, the Internet is becoming a new medium for corporate and product promotion.by Bruce Fienberg
Japan Press Network
Whether you like it or not, the Internet is going commercial as providers increasingly turn to advertising revenues to generate income outside the traditional source of monthly user fees. No doubt, most cybernauts cringe every time they encounter an advertisement on their favorite World Wide Web site, but it is these advertisements that have helped to fuel the Internet's explosive growth in 1995. Internet advertising not only helps to keep Internet service providers in business, but it provides the funding required for the new technologies that will shape the very essence of the Internet in the years ahead.
"I'd say it's going to be like television, with advertising working to bring down user costs," predicts Chris Burdge, Internet Access Center's vice president for sales. The way he sees it, the Internet offers companies, both big and small, any number of exciting ways to reach audiences throughout the world via interactive advertising. Though Japan's Internet audience is currently limited, the growth of home computer use and increasing interest in the Internet will eventually open up more and more advertising opportunities as the nature of the technology allows advertisers to convey much more information about their products and companies on their Web sites than through print or television.
A number of leading companies already have their own Web sites -- Japan Airlines, Reebok, and Sony Corp., to name just a few -- from which potential customers can learn more about a company or even order products directly from the source. But Burdge cautions that companies need to do more than just set up their own Web sites if they want to be successful advertisers. The question advertisers need to ask themselves, with all the thousands of sites currently on the Web, is: How will their sites be found by potential customers? The answer, according to Burdge, is to create links on popular sites -- such as the highly popular Internet directory Yahoo, the Asahi Shimbun, or those set up by Internet providers -- that will lead Web viewers to an advertiser's home page.
"You need to have both. If you buy ad space on other Web sites, where does it point?" asks IAC President Brad Bartz. For advertisers that do not have their own sites, Bartz says, there are companies that can help them design and build creative, innovative Web sites that will attract viewers and do more than simply present a corporate logo on someone else's home page. "The advertisers who have a jump start on the rest of the community are those who have created a place to go," Bartz says.
One good example is Chrysler Corporation's home page, which kicks off with a floor map representing the areas that can be visited, such as product lines, corporate information, and new technologies. So how do you find Chrysler's Technology Center? One way of coming across it is via Time Warner Inc.'s Pathfinder home page, which dishes up both news and information published in a number of the media giant's magazines, as well as presenting a forum for advertisers. Clicking on Pathfinder's "Market Place" icon leads viewers to a list of advertisers, such as Chrysler, that have sites to visit.
According to Brian Maeda, Time Inc.'s advertising sales manager in Tokyo, Pathfinder receives 12 million hits per week -- making it one of the most popular sites on the Web. Maeda describes Pathfinder as a way for advertisers to funnel people to their home pages. He says that although print advertising will continue to play a role in a company's marketing strategy, the interactive aspect of the Internet opens up unlimited ways to reach a particular audience.
With the Internet's huge rate of growth, particularly with regard to the Web, some advertisers are reluctant to get involved because they can't get a good handle on the medium, Maeda concedes. Both Maeda and Burdge agree, however, that there is no shortage of advertisers wanting to go online. "There is some risk involved, but it's a very good choice for someone to do some experimental marketing," Maeda says.
Selling ad space on existing sites is similar, at least as far as the basic principles are concerned, to selling space in magazines. Prices are determined by where the advertisement is placed, such as on the opening page (which attracts the most viewers) or somewhere else on the site, as well as by how many people actually visit the site.
Many within the advertising community argue whether the number of "hits" (the number of people who access a site) is really a good indication of readership. There is software available that records "impressions," however, which is usually a smaller number than "hits," but a more accurate count of how many individuals have accessed a site. In other words, those who sell ad space are able to convey to advertisers exactly how many individuals have accessed a site and which areas on that site were visited. Not only can an advertising sales department determine how many people have viewed a site, but it can also get a good idea of the demographics of the site's audience by taking a look at each viewer's domain coding.
Where advertising on television or via the print media differ is the interactive nature of using the Internet. An advertisement on television or in print remains static, whereas advertising on the Internet offers advertisers an opportunity to interact with potential customers through e-mail and online ordering, and by being able to quickly and easily update product information (not to mention providing sound and video clips and attractive-looking graphics).
While one of the appeals of the Internet is its global audience, IAC's Bartz says the global nature of the medium can actually present problems for some advertisers, particularly those in Japan. "Everyone has become aware that the Internet is a global audience, which means advertisers have to have a global strategy." He goes on to explain that advertisers who do not have a global outlook in their business are sometimes slow to go online. But, ultimately, the location of a site's server, whether it be Tokyo, London, or San Francisco, is an advertiser's most immediate audience. A good number of the Web sites in Japan are bilingual, offering both Japanese and English, and allowing Japanese advertisers to specifically attract a Japanese audience -- if that is the niche they wish to remain in.
Another problem that advertising on the Internet may present for advertisers is that, with so many sites now available on the Web, where does one begin? "Web sites are increasing by the hundreds per day, but the ones that can continue to generate advertising revenue will have to have good content. Others will remain static, and if they don't have the audience, they can't get the ads," Burdge says.
This goes back to the example of magazines. Just as an advertiser determines which magazines have an audience that best represents the type of people most likely to buy their product, they will choose Web sites to place their ads in the same manner. Non-advertisers who put up Web sites may also find themselves entering into syndication agreements an Internet-savvy company in an advertising agency role, whereby it would sell advertising space on existing Web sites run off of other servers.
Burdge notes that Internet providers are not the only ones getting into the business of advertising sales. "Everyone is getting into the business of setting up Web sites. PR agencies are including it as a service in their brochures, and printers are getting into it as well." He argues, however, that the competition is good for the overall business. Especially as advertisers are becoming more knowledgeable about the medium, so too are Internet providers and companies that design Web pages learning about how best to use the technology to promote their advertising clients.
Meanwhile, classified advertising is expected to be a boon for Internet providers, given the nature of the technology. Individuals in search of employment, for example, will be able to post their resumes and at the same time use search engines to quickly call up particular companies and positions available. People placing classifieds would also be able to post photographs of items for sale, such as automobiles, apartments for rent or household goods. "Classified advertising on the Net will replace newspaper classifieds," predicts Bartz. "Classified advertising on the Internet offers quicker responses; it's real time."
Bartz also has high hopes for other advertisers, whether they are large multinationals or small entrepreneurs who like to keep their overhead low. "Eventually every advertiser is going to have a Web page, and it's important for them to understand that they should not be afraid of new technologies," Bartz advises. "Internet users are very forgiving, so feel free to experiment."ç
Bruce Fienberg has been reporting in Asia for the past 10 years, the last six based in Japan. He is the Editor-in-Chief of Japan Press Network, a newly formed Internet-based news service that is a wholly-owned subsidiary of Internet Access Center KK.
Internet Access Center KK is a leading Internet provider in Tokyo that is involved in all aspects of the Internet, including Web page design, training, personal and corporate connections, and Web-based advertising sales.
Doing business
on the Web
Businesses worldwide have discovered the World Wide Web, and its potential
for both PR and profit. Not only is the Web the most cost-effective publicity
medium ever conceived, but through the proper use of hyperlinks it becomes
a convenient and dynamic storehouse of information. Estimates of Internet usage vary widely; the most plausible suggest a current audience of 30 million users worldwide, with the number growing at a rate of 10% or more per month. The utility of the Internet as an effective business tool will increase as encryption and authentication standards advance, and users get used to the convenience of shopping from their computer. For businesses, making detailed product and service information (including images and even sound files) available to prospective customers will encourage this trend, and create new opportunities.
Not that using the Web effectively for business is easy -- it is not simply a matter of putting together a few home pages and links. Corporate managers need to learn new promotional techniques, study the efficient use of new technologies, and even adopt a new way of thinking. And they dare not be slow about it. With the proliferation of businesses on the World Wide Web, gaining mindshare at an early stage is vital to success. In the end, it is the volume of visits to a Web site that will determine its value to a company.
The business paradigm is set to shift yet again. Not having a presence on the Web will soon be the equivalent of not having a fax machine. And not doing business via the Web may soon be equivalent to simply not doing business.
