Let us start with a fundamental question: Is advertising even relevant as a factor in sales today? The answer is a resounding yes. Even the largest companies and the biggest products benefit from advertising. That’s because advertising allows us to spread our message to the most amount of people at once, rather than individually. This frees up our time so we can meet potential customers,innovate within our processes or products, or simply runour business without having to worry about sales.
Even if advertising doesn’t translate into an immediate spike in sales, it is quietly doing its job of building the brand in the public eye, positioning it, giving it a personality, humanizing it and keeping it visible. Advertising thus places your product in the consideration set of the potential buyer, and that is half the battle won.
A new revolution
Advertising has evolved from time to time. From the loud verbal pitches of street vendors, to posters, to print ad in newspapers and magazines, to radio ads, to television ads – the advertising industry has seen one revolution after another. This article is about the latest such revolution – internet advertising. As we shall see, this latest revolution is as vast as the internet itself.
Almost a quarter century ago, in 1994, the World Wide Web was in its infancy, and a new company called Yahoo had just created something called a ‘searchengine’ – a way to look for sites on the Internet. In the same year, HotWired became the first online magazine to carry advertisements in the form of colourful banner ads that looked like hoardings. These were the world’s first banner ads, and about 10 percent of those who saw the ads clicked on them. These people were then taken to the sponsor’s Web site, and advertising’s new age had begun.
Today, Internet advertising is much more sophisticated, and pervasive, with powerful capabilities to deliver cutting-edge graphics, to target the precisely correct audience, and to measure results instantaneously.
Even today, many experts believe that Internet advertising is just taking baby steps, and that in the future we will compare today’s internet ads with the first television ads – where people – usually attractive ladies – walked across the screen carrying a sign that pitched the product, or we had a visual version of a radio ad – often called a talking heads ad. These were near-literal translations of hoardings and radio ads and they did little more than set the previous forms in motion.
But television ads evolved to give us a revolution in the art of visual storytelling as well as an entire range of special effects. Similarly profound revolutions are taking place today, thanks to internet advertising.
In the old school of advertising, somebody made a popular TV show or a magazine and thus created a dedicated audience of a particular demography. Marketers then took advantage of this by running their ad. Today, through internet advertising, we can identify and reach our customers rather than having them come to us.
Also, effectiveness data was provided to advertisers (in the offline realm) in the form of monthly or quarterly reports.Today, one can get these results immediately, and thus can fine-tune their online ad campaign in real time.
So where is it all heading?
Just a few years ago, online advertising made up about a quarter of the $500 billion global advertising business, and it has been rising fast ever since. Some of this century’s most powerful companies, including Google, have emerged on the back of it.
Digital advertising today is gaining thanks to three important trends.
- The first is the rise of mobile devices, such as smartphones and tablets. Today more than 1.7 billion people (around 20% of the world’s population) use smartphones.Mobile devices, which are intimately connected to their owners, have changed the way in which people use the internet. Users are now spending more and more time on their mobile devices compared to desktop computers.
- The second trend is the rise of social networks such as Facebook, Twitter and Pinterest, which have become important systems for people looking for content across the web. Social networks hold rich data about their users, who volunteer lots of information about themselves. Facebook and Twitter can also see where else people go online, which can help them sell their users’ attention to advertisers.
- The third big development has been the rise of real-time bidding, or “programmatic buying”, a new system for targeting consumers precisely and swiftly with online adverts. Publishers, advertisers and intermediaries can now bid for digital ads electronically and direct them to specific consumers at lightning speed.
In conclusion, the internet is here to stay, and so is internet advertising. Because wherever the consumers go, advertising must follow. As humanity changes the ways in which it interacts, socializes, spends its work and leisure time, expresses its thoughts and feelings and looks for fulfilment, advertising is marching right alongside, every step of the way.