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The Internet's Impact on Advertising

The shift from traditional advertising in print, radio and TV to online advertising presents big opportunities for those knowledgeable about marketing and technology.

"I believe online advertising budgets will continue to grow at the expense of TV and more traditional advertising budgets," says Rae Hoffman, an Internet marketer in Texas. "I think TV knows it's in trouble, so to speak."

A lot of companies have shifted money they used to spend on phone book advertising toward online advertising.

"I have clients who have been able to replace phone book advertising -- Yellow Pages -- with their website ranking in the search engines, because so many people go to the Internet now to search for, in particular, a local service," says Allan Todd. He's an Internet consultant in Colorado.

Kimberly Nichols, an Internet consultant, has also seen a big shift away from phone book advertising and toward online advertising.

"That's one of the things that people are abandoning ship quite quickly on," says Nichols. "They're realizing that they're spending thousands of dollars and they have no way to know [the response]. When I ask them, 'How many phone calls a year do you get from the Yellow Pages?' most of them say, 'I have no idea.' And I say, 'Then why are you spending all this money?'"

A big advantage that Internet advertising has over print or TV advertising is the ability to track your audience. You know what's getting results.

"One of the most important things about online advertising is that you can measure and track everything," says Nichols. "Anything that you do you can get results right away and understand whether or not it's working for you. And then you can change course very quickly."

Nichols contrasts online advertising with doing something like printing 10,000 brochures.

"You go all through the process of publishing and doing the graphics and the layout and printing, and then find out you have a typo. It can be a real nightmare and it's not cost effective at all. Whereas anything you do online, if you find you have a mistake, you can correct it right away, and you can experiment."

Another advantage of online advertising is the ability to target specific audiences. Social networks such as Facebook and LinkedIn make very specific targeting possible.

"You can target by gender, age, location," says Nichols. "Specifically, location seems to be one of the most important factors, and... if you're targeting on LinkedIn you can target people with specific professions and those who work at specific companies. You have a lot of options. There's a lot more targeting. You can't do that in the real world, in traditional marketing."

"Online advertising has targeting capabilities for the advertiser that traditional advertising never has and likely never will," Hoffman adds. "And that usually means lower CPAs (cost per acquisition) for the advertiser."

TV advertising is still a huge industry. Many tens of millions of people, for example, watch Super Bowl ads each year. But more and more people are watching shows and videos online. TV and the Internet seem to be merging.

"I don't know that we're quite there yet," says Nichols. "Some companies are deciding to pull their Super Bowl ads and put them on YouTube, and there's streaming television. You can advertise there (online), but the advertising is very different on those kinds of shows than what you can get away with on traditional television. The ads have to be much shorter and very clever and people are learning to hit the mute button and skip over them."

Todd says businesses are seeing the value in putting marketing videos online. But they're also realizing that advertising on TV and putting videos online is not the same thing.

"With TV, you're sitting there passively staring at a show and a commercial comes on that's a video. That doesn't happen on the Internet. People have to search for you and find you," says Todd.

"But we definitely are making videos in a kind of way where they are similar to the commercials, where they're delivering a quick 30-second or one-minute brochure-style depiction of that business.

"On TV, I think commercials are often used for branding purposes, just to expose the name of the company to more people and just create what's called 'brand awareness,'" Todd adds.

"And videos on a website or videos on YouTube are often more instructional or educational. People don't go to YouTube and watch a branding style video. Usually they watch a video to learn something. So there's a difference in the nature of the content."

As you'd expect, working in online advertising requires an ability to keep up with constant changes.

"You have to be able to stay current on the trends and to understand technology to a certain point," says Nichols.

"You don't necessarily have to be able to do it yourself... but I think you just have to have that finesse with technology and not be afraid of it [and] be able to go to a site like LinkedIn or Facebook and figure out how the ads work and what the best strategy is. The strategy is probably the most important thing, more so than the technical skills on how to actually do it."


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