Online advertising can be incredibly efficient and effective, but is it right for your business – and your budget?
I Want To Advertise Online, But Our Small Business Has A Very Limited Budget
Although the Internet is a relatively young medium, at least in comparison to radio, television, and especially print publications, online advertising (also known as Internet advertising) has become both dominant and ubiquitous. As of 2011, Internet advertising revenues exceeded cable television and almost exceeded broadcast television. In 2012, online advertising revenues in the United States totaled $36.57 billion – a 15% increase over 2011!
Three Main Methods
Online advertising includes three main delivery methods: display advertising (banner and text ads), email marketing, and mobile advertising. While email marketing is limited to email, display advertising and mobile advertising can be implemented through web pages, search engines, device applications and social media platforms. While advertising aimed at desktop users can utilize somewhat static location-based information, mobile advertising is unique in that some mobile applications and operating systems allow advertisers to use very specific location-based ad targeting.
One of the most desirable aspects of online advertising is its universality. Almost all consumers in the U.S. use the Internet in some capacity, and businesses and organizations from almost every industry and region can successfully utilize online advertising. Another aspect of online advertising that makes it incredibly appealing to businesses and organizations is its power to pinpoint and target specific segments of consumers based on region and user preferences, and its subsequent ability to measure the effectiveness of the advertising campaign. Finally, when implemented correctly, online advertising can be a less expensive alternative to print, radio, and especially television advertising.
While there are many advantages to online advertising, there are also disadvantages as well. Online advertising is unique in that many of its disadvantages are related to the amount of control and flexibility that users have over their computers and mobile devices. While DVR technology exists that allow television viewers to “skip” television ads, and readers can certainly fold over or even rip paper advertisements out of magazines, online advertising is unique in that users can effectively block advertisements completely. Email marketing can be automatically deleted or blocked, users can install ad blocking and privacy extensions to web browsers, and advanced users can even configure Internet routers to block all content from domains belonging to online advertising companies.
Even when users are not actively seeking to block ads, the sheer variety of hardware and software configurations can cause advertisements to display incorrectly or not at all. Some online advertising methods are susceptible to fraud, such as “click fraud”, in which automated programs and compromised “zombie” computer networks are used to fraudulently drive up the cost of online banner ads or text advertisements. Finally, many Internet users find some forms of online advertising to be distasteful and invasive, especially advertisements that expand over web pages and utilize sound or video and ads that oversaturate certain web pages or social media platforms.
Two Dominate Companies
As of the fall of 2013, two companies dominated online advertising with a projected combined market share of 39% of all internet advertising and a whopping 70% of mobile advertising for the year, and chances are you are very familiar with both. Google and Facebook offer dissimilar core products and similar secondary products – Google’s primary product is their Internet search engine, but they also over a variety of cloud-based consumer services. Facebook’s primary product is their social networking platform, although like Google they also over a variety of cloud-based consumer services.
Google And Facebook
The main advantages over their competitors that Google and Facebook share are their incredibly large user bases and market shares. Google dominates the search engine market with a 67% share and 13 billion searches just in the month of July, while Facebook has over 1.15 billion active users. While other tech companies including Microsoft and Yahoo! sell online advertisement services, they can’t match the sheer size and scope of Google and Facebook. Other social media services like Twitter and LinkedIn also boost sizable user bases and advertising products designed to cater to those users, but neither service can match the dominance of Facebook in this market.
Both Google and Facebook offer limited, low-cost options for small companies and organizations to advertise on their platforms. Google Ads offers a variety of options for small advertising campaigns, while Facebook allows businesses to setup free social media pages with the option to purchase display advertisements and promote specific social media posts. If you are interested in mobile advertising, Google offers advanced options for advertising through mobile display ads, display ads in mobile applications, and other forms of targeted mobile advertising. Facebook is somewhat limited to offering ads through its mobile applications and web interface, and they have only recently begun rolling out ads to both platforms.
Tracking Logged-In Users
Google offers a wider range of platforms and options for reaching consumers – many websites and services that you wouldn’t associate with Google, including many media outlets and other online content providers, utilize Google Ads. In contrast, Facebook advertising is limited to the Facebook platform, although Facebook’s audience is more captive to the platform and incredibly targeted, based on the information users provide to Facebook through status updates, messages and likes. Finally, both services continue to track their logged-in users, even after those users have navigated away from Facebook and Google’s services. This provides both companies with detailed web histories and other user information.