da

1. A project of
“Online Marketing”
In fulfillment of the Study Oriented
Project under the guidance of
By
MAHENDER REDDY

2. Acknowledgements
With profound gratitude and respect I express my sincere thanks to Prof. Anil K
Bhat for giving me the opportunity to work under him. His timely guidance and
advice always kept me motivated to do better and on the right path. I would also
like to thank him for the helpful resources suggested by him.
And last, our earnest thanks to Google and the World Wide Web, without which
this report would have no beginning, nor an end.

3. Abstract
This report aims to cover all the important online techniques currently being practiced
by industry professionals. It elaborates every technique with relevant case studies,
examples etc. Important online marketing techniques covered in the report are Search
Engine Optimisation Marketing, Viral Marketing, and Display Advertising etc.
The report also takes up Mobile Advertising and its effectiveness in India. Every
section is concluded by some suggestions to improve the current monetization
and business models in every kind of marketing technique.
A final conclusion is drawn as to the state of Online Marketing in India and its
place in the future, which surely looks bright.

4. Table of Contents
1. Internet – An Introduction
1.1.Past, Present and the Future
1.2.The Indian Scenario
2. Internet Marketing
2.1.Push or Pull?
2.2 Types of Online Marketing
3. Search Engine Marketing
3.1.Introduction
3.2.Page Rank: An Overview
3.3.Analyze Google Rankings
3.4.Case Study: SEO for small companies
4. Display Advertising
4.1.Introduction
4.2.Banner Copy Testing
4.3.Portal Case Study: Hong Kong web site
5. Viral Marketing
5.1.Introduction
5.2.Evaluating a viral campaign
5.3.Viral campaign backfires: A case study
6. Interactive Marketing

5. 6.1.Introduction
6.2.Interactivity and advertising
7. Social Media Optimisation
7.1.Introduction
7.2.MySpace or yours?
7.3.Growth of Social Media
7.4.Social Media Backfires: A Case Study
8. Mobile Marketing
8.1.Introduction
8.2.Advertising for Gen M
8.3.Effectiveness of Mobile Advertising: India
9. Integrated Marketing Communications – Online
(IMC)
9.1.Introduction
9.2.Overview
10. Conclusions
10.1.Future of Online Marketing
10.2.Future of Online Marketing companies in India
11. References

6. 1. Internet – An Introduction
1.1. Past, Present and the Future
With increased globalization of the world economies, for most enterprises, market
opportunities seem to be endless these days. This in turn, of course, causes heightened
competition among the players in order to achieve better performance. Consequently,
departing from the traditional commercial strategies and tactics, innovative managers are
looking for unique ways to compete more effectively on a local, regional and global basis.
The information superhighway is being shaped by advances in digital telephone networks,
interactive cable television, personal computers, online services and, finally, the Internet.
The Internet, also known as the “International electronic network,” began in 1968 by the
Advanced Research Projects Agency of the Department of Defense. Originally, known as
the ARPAnet, the Internet was started as an experimental network connecting different
university computer centers throughout the country. The combination of ARPAnet and
commercially available backbone services forms what the Internet is today – the world’s
largest collection of decentralized computer networks. There are over 30,000 estimated
computer networks connecting more than 1.5 million computers to one another.
Transmission Control Protocol/Internet Protocol (TCP/IP) is used by all of these networks
as the standard communication protocol through which data communication is
accomplished. At least 20 million people (actually estimated at 30 million) in 135 countries
send and receive information through the Internet.
The Net represents a $300 billion market. Over 30 million companies and
households around the world use the Internet as a communications link through e-
mail, interactive advertisement, bulletin boards, research and online discussion
groups. At its most basic level, the Internet serves as a seemingly endless catalog
of marketing messages and advertising in an interactive fashion.
Advantages of the World Wide Web
Global opportunities

7. The Net access delivers a company with an opportunity to implement highly cost-
effective vehicles not only for their own marketing and customer support needs, but
also for positioning themselves globally. More and more businesses are discovering
that they have the ability to reach and communicate with current and potential
customers abroad through the Internet with the same cost and ease as in the USA.
• Accessibility
Companies who use the Internet, not only for advertising, but for e-mail and
customer ordering, increase their hours of business on a global spectrum. Instead
of a typical eight-hour day, businesses have increased their opportunities by
providing 24-hour access for branch offices, business contacts, and shoppers.
• Utility
Providing appropriate form, place and time utility (i.e. giving customers the
opportunity to decide what they want, where and when) may result in a
competitive advantage for the marketers.
• Advertisement effectiveness
Traditionally, advertising has been one of the major forms of communication
between a firm and its clients. But with internet, advertising has moved on to
interaction, customerisation and constant feedback models.
1.2. The Indian Scenario
Though the internet entered the Indian market a bit late, Indi has now fully emerged as an
IT giant in the making and internet is playing a pivotal role in connecting businesses and
providing employment opportunities. Here are some statics on the Internet usage in India:
• 80 million users by 2010
• Some target markets include matrimony sites, social networks, movie review sites etc.
• The market is growing at 11.2%
th
• 5 largest internet market globally.

9. If we look at some Online Advertising statistics from US:
• Search marketing spending will grow by 14.9% in 2009
• US Internet ad spending will increase to $25.7 billion in 2009, an 8.9% growth rate.
With online communities growing by the millions, most companies have taken
notice of the power of this huge consumer base, and are trying to reach them from
the bottom of the base. And a new trend is emerging called Behavioral Targeting:
• Uses information collected on an individual's web-browsing behavior, to
select which advertisements to display to that individual.
• Site owners display content more relevant to the interests of the user.
• Used by online publishers and advertisers to increase the effectiveness of campaigns.

10. 2. Internet Marketing
Internet marketing is the marketing of products or services over the Internet. The Internet
has brought many unique benefits to marketing, one of which being lower costs for the
distribution of information and media to a global audience. The interactive nature of
Internet marketing, both in terms of providing instant response and eliciting responses, is
a unique quality of the medium. Some of the major advantages of marketing over the
internet that have already been discussed above include:
• Cheaper and better reach to target audience.
• One to one personal approach.
• Statistics can be tracked easily. This results in better feedback and improvements.
2.2.Push or Pull?
The marketing techniques over the internet have evolved into a truly novel concept,
which combines the push techniques of Television, Print marketing etc. and uses
clever placement of content to define a new concept called ‘Push me, pull you’!
In the world of Web marketing advertisers' `push' of content only works if someone is
`pulling'. Successful marketing on the Web is all about pushing content that has the most
`pulling' power for the Web user. In order to build a thriving content site, you must offer
news or truly customized data. It is not just about creating ``fresh coolness''.'
To create successful marketing on the Web one has to understand the motivation that will drive
pull'. Many of the principles of Internet marketing are the same as for traditional marketing:
understanding the target audience (the `who' and `what' for communication), how to reach it
and how to tell if it has been reached, and communicated successfully with. In the case of
marketing on the Web, however, it is also necessary to think about who in the whole wide Web
world will be looking to `pull' the content, and whether the content will appeal.
There are `wired' audiences that are particularly likely to `pull' content. These tend to be
specialists and opinion formers, such as journalists who rely on the Web as a source of
information. Public relations consultancies are harnessing the Web as a conduit for reaching
journalists with press information on new brand launches. In this way the Web acts as a
powerful `few-to-many' communications channel, whereby the targeted journalists reach out

11. to their readers, often of traditional print media, with the story. By dint of having the journalist
seem to endorse the launch, the story is more credible, with the further benefit that the Web is
global, and instantaneous in its reach. Once the dynamics for `pulling' the defined target
audience are understood, marketers can start to consider how to `push' content out. `Push'
may entail promoting an online presence through traditional marketing methods or it may mean
`pushing' promotional material to people once they come online. Whatever the online marketing
technique used, many of the rules of offline marketing apply; research is the key to planning,
implementing and measuring the effectiveness of an online campaign.
2.2 Types of Online Marketing
There are many ways to publish and market content and services over the internet,
most of which can be published instantaneously for millions of viewers. Some of
the techniques studied in this report include:
• Search Engine Marketing
• Display Advertising
• Viral Marketing
• Interactive Marketing
• Social Networking
• Mobile Marketing
• IMC (Integrated Marketing Communications) Online
3. Search Engine Marketing
3.1. Introduction
Wikipedia, the online library quotes, ‘Search engine optimization (SEO) is the
process of improving the volume or quality of traffic to a web site from search
engines via "natural" ("organic" or "algorithmic") search results. Typically, the
earlier a site appears in the search results list, the more visitors it will receive from
the search engine. SEO may target different kinds of search, including image
search, local search, and industry-specific vertical search engines.’

12. Marketers all over the world are using various techniques to push their web sites at the
top of the results page. This section will deal with how Google works, how can one
optimize rankings and what can be the best SEO approaches for a small company.
3.2. Page Rank: An Overview
The following sub-sections deal with the calculation, implementation and impact of
the PageRank, which is the prerequisite to recapitulating existing search engine
optimization strategies. A complete understanding of how Search Engine results
can be optimized are thus obtained, which provides a sound base for further
reading. Understanding the implementation and impact of the PageRank (PR)
algorithm allows the focused development of Internet-marketing strategies.
The following primarily introduces the calculation of the PR. Based on the
calculation model, the implementation is illustrated. Additionally, the impact of the
PR, different link strategies and feasible SEO approaches are also elaborated.
Calculation
The Page Rank represents a web site’s importance within a set of pages (e.g. Internet) and
has a major impact on the positioning of web sites within the search engine result pages
(SERP). The following Equation describes the rather simple calculation of the PR:
Within this formula q is the residual probability (usually 0.15) derived from the “random
walk“principle (used to avoid rank sink), N the total number of pages, M(pi) the set of pages
linking to pi and L(pj) the number of outgoing hyperlinks of the page pj . Limiting the number of
iterations required to efficiently calculate the precise PR is a major determinant to optimizing
the speed of the crawling/indexation process. The overall ranking of a page within the SERP is
deducted from the PR and the relevance-score (RS). As described in the next equation, those
two factors are weighted by a set of controls and a factor-base, which is defined as:

13. Within this formula, RS is the relevance-score (determined by onsite-factors like
title-tag), PR the PageRank, as explained above, a, b, are weight controls and fb a
factor-base to integrate the logarithmic core PR. While the PR is linear, the rank
shown on the Google toolbar (http://toolbar.google.com) or alternative tools is
mapped on a logarithmic scale with an approximate basis of 5-8.
How does Google work?
Google is fetching URLs coordinated by a URL-server. The fetched sites are compressed and
sent to a store-server indicated with a doc-id. An indexer distributes the parsed and analyzed
web page as hit lists (set of words) in a partially sorted forward index barrel. Additionally, the
indexer stores information about hyperlinks on the document in an anchor file. Those
hyperlinks, converted by a URL-resolver, are again associated with doc-ids. A database with
pairs of such resolved doc-ids is used to compute the PR as stated above. Finally, the sorter
creates an inverted index from the barrels sorted by word-ids which is then used by the
searcher. Performing a single word search, Google converts the word into the word-id to
search in the short barrel, analyzing the hit lists of the indexed documents. The hit type is
combined with a type weight (the dot product of the vector of count-weights with the vector of
type-weights) to the RS. For a specific query, Google uses onsite-factors to select a first subset
of relevant matches (RM; example 10,000 pages) from the total number of matches (M; example
100,000 pages) from the large repository (approximately 27 billion pages). This subset RM is
determined by approximately two simple indicators (presumably title-tag and keyword density
(ratio of the number of occurrences of a particular keyword or phrase to the total number of
words in a page As explained, the onsite-factors are highly important for Web pages in such an
algorithm; a high PR is totally insignificant in case the Web page does not fulfill the
requirements for being included in RM. This non-PR threshold determines a set of different
SEO strategies. The significance of PR for the overall ranking has stressed the necessity of
distributing inbound hyperlinks within the Internet.
Impact on SEO strategies
The establishment of more inbound hyperlinks has been approached by: link-exchange and link
spamming. While link-exchange was still a rather natural process (“I link to you, so you link to
me”), link spamming was implemented in many different forms. Link-farms for example enabled
the distribution of a large amount of static hyperlinks utilizing rather simple algorithms. More
sophisticated technical approaches were the active utilization of the web site’s structure

14. to highlight specific web pages. The structures of the web pages have an important
impact on the PR distribution.
3.3. Analyze Google Rankings
The purpose of this sub-section is to identify the most popular techniques used to rank a web
page highly in Google. The paper presents the results of a study into 50 highly optimized web
pages that were created as part of a Search Engine Optimization competition. The study
focuses on the most popular techniques that were used to rank highest in this competition, and
includes an analysis on the use of PageRank, number of pages, number of in-links, domain age
and the use of third party sites such as directories and social bookmarking sites. A separate
study was made into 50 non-optimized web pages for comparison. Understanding which
factors can influence a page’s ranking in a search engine is therefore crucial for any web site
that wishes to attract large numbers of users (in particular, e-commerce sites). This section
therefore sets out to identify the most effective techniques that can be used.
In order to do this, the section presents the results from an analysis of the most successful
pages that were created as part of a Search Engine Optimization (SEO) competition (SEO is
the process of trying to rank highly a given web page or domain for specific keywords).
Because all of these pages are highly optimized, the resultant set of data represents an
aggregation of the most popular (and thus implicitly, the most effective) techniques used
by the most successful Search Engine Optimizers in operation today.
Issues with inferring search engine-ranking factors
The web factors that could potentially influence a search engine’s ranking of a web
site can be classified according to two distinct categories:
Query-Factors (On-Page factors), which rely on the content of a web page, such as the
existence and frequency of keywords; and Query-Independent Factors (Off-Page factors),
which rely on information from external web pages that link to a web page under consideration.
However, both types of factor are notoriously difficult to enumerate as the search engines do
not reveal which particular ones they use when determining a web site’s ranking. Although
identifying the ranking factors is extremely difficult to infer, and the claims made by individual
SEO companies difficult to verify, an understanding of the most effective techniques can be
achieved by analyzing a set of highly optimized web pages created by a host of the leading SEO

15. companies and individuals. These web pages can easily be found by entering a
specially constructed query into any search engine. This query contains the keywords
V7ndotcom Elursrebmem, which was defined by the industry-leading SEO web site:
www.v7n.com in a SEO competition it ran between January 15 2006 and May 15 2006.
The keywords in the query were constructed in such a way as to ensure there were no
existing pages that would rank for this query before the competition began, and the
only pages that would ever rank for it would be those that would be competing in the
competition. The participants were leading SEO companies and individuals.
Experimental design and methodology
Defining the factors to analyze
Of the 200 or so factors that Google claim they use when determining a page’s
rank, the following have been chosen as representing the factors that most likely
exert the greatest influence on a page’s rank:
• Number of web pages in a site indexed by search engine.
Some web sites are bigger than others by several orders of magnitude.
Bigger may be better as far as rankings are concerned.
• PageRank of a web site.
Google’s PageRank algorithm helps rank web sites according to the number
of in-links, and the calculated authority of each site providing the in-link.
Generally, the higher a site’s PageRank, the higher it’s ranking (and the more
authority it can confer to other sites it links to).
• Number of in-links to a web site.
PageRank can be substituted by in-links as a good approximation of rank.
• Age of the web site’s domain name.
The SEO community currently speculates that older domain names will rank
more highly than newer domain names for the same content.
• Listing in Yahoo and DMoz directories.
Both Yahoo and DMoz.org (the Open Directory) are human-edited directories
whose results feed into directories from other search engine companies such
as Yahoo and Google, respectively. Because of the high quality control of these
directories, the sites they list are deemed to be of high authority, which the
search engines may use as one of their ranking factors.

16. • Number of pages listed in Del.icio.us.
Del.icio.us is a social bookmarking site that enables anyone to bookmark a
page. Because of its popularity and the fact that a bookmark can be interpreted
as an implicit recommendation of a page, the number of different people who
have bookmarked a specific page may add to that page’s ranking.
Results and analysis
Analysis of the top ten results for the query V7ndotcom Elursrebmem
At first glance, the results presented in Table I, show a wide variance for each
individual factor. However, the techniques used by each SEO competitor become
clearer, as the following analysis shows.
Number of pages indexed
For the top ten results, the number of pages of individual sites indexed by Google range from
two to 21,600. Widening the result set to the top 50, this range increases from two to 334,000,
with some SEO competitors clearly attempting to influence the rankings through sheer volume.
However, with the second placed competitor having only eight pages indexed, a high volume of
pages is clearly not needed to rank highly – quality seemingly counts over quality.
That said, an analysis of the top 50 shows that creating a large number of pages is a technique
used by many SEOs, with some success. Figure 1 shows the number of pages indexed for the

17. top 50 (number of pages shown on a logarithmic scale). The majority of pages ranked
in the top 27 clearly have more pages indexed than those that rank between 28 and 50.
PageRank of a web site
The PageRank of the top ten from the v7n set ranged from PageRank 4 (PR4) through to PR7. Figure
2 shows the frequency distribution of PageRank, which clearly shows how important PageRank is to
a page’s ranking. For example, no page with a PageRank less than 4 ranked at all within the top 40.
However, despite the obvious importance of PageRank, it is impossible to state that a specific page
with a certain PageRank will rank higher than other pages with a lower PageRank; only that high
PageRank pages tend to rank higher than lower PageRank pages.
Comparing the PageRank distribution for the v7n set (Figure 2) with the mobile phones set
reveals a broader distribution of the PageRank values for the mobile phones set. This is
due to different types of web site all ranking highly for the query mobile phones, each with
its own individual properties that will impact upon a search engine’s ranking algorithm.

18. Number of in-links
Figure 4 shows the number of page in-links for the v7n set. Note that these figures
reflect the number of in-links to a specific page, rather than to the whole web site.
The trend clearly shows a decline in the number of in-links as the rankings fall.
Domain age
Domain age (i.e. the date at which each domain was registered) has been posited
as an important factor in the ranking of a site, as older domain names are said to
be inferred by Google’s ranking algorithm as conveying more trust, and therefore
should rank higher than newer domains.

19. DMoz directory submissions
Figure 6 shows the number of sites listed in The Open Directory for the v7n set and the
mobile phones set. The mobile phones set is consistently high, with 80 percent of sites
included in the directory. In contrast, the v7n set shows a marked difference between
the top 10 sites and the remaining sites, and only 22 percent of sites in the whole set
being included. Being listed in DMoz is notoriously difficult, however, with lead times
of six months to a year before an entry submission is actually included, due to the fact
that human volunteers must judge each and every entry.
Yahoo directory submission
The results of the Yahoo directory submission analysis were less conclusive, as so
few of the v7n set had a Yahoo directory entry. Only 14 percent of sites were listed,
33compared with 90 percent of the mobile phones set. The reason for this is
presumably the fact that entry into the Yahoo directory costs $300 and again may
take several months for a site to be listed. Consequently, with a high initial outlay
and no guarantee that an entry will even appear in the Yahoo directory in time for
the contest’s closure date, it appears that very few SEOs attempted this option.

20. Del.icio.us bookmarks
The number of pages bookmarked in Del.icio.us for both the v7n set and the mobile phone
set also shows a notable disparity. Del.icio.us links will only appear if people choose to
bookmark them. Although this appears to be a fail-safe way of determining a page’s
popularity, a bookmark does not, of course, give any indication of the intention of the
bookmarker. As such, a page can appear popular simply by the page’s author encouraging
as many people as possible to bookmark it for reasons other than popularity.
Conclusion: 92 percent of the top 50 pages in the mobile phones set have del.icio.us
links, while only 54 percent of the v7n set do. However, of the v7n set, there is a clear
trend showing more del.icio.us bookmarks the higher the ranking. As such, attracting
del.icio.us bookmarks would appear to be a technique used by the more successful
SEOs, but it cannot be said that del.icio.us bookmarks confer high ranking
Conclusion
This section has presented the results of a study into the techniques used by top
SEOs to rank their web pages no. 1 in a SEO competition. After describing the
experimental design and methodology used, the results of the study were as follows:

21. • Many SEOs generated many pages to influence rankings, which proved a partial success.
• High PageRank in Google clearly plays a major part in a page’s rankings, and
attaining a high PageRank was a goal of most of the SEOs. However a PR of a
particular rank will not necessarily rank higher than a PR of a lower rank.
• The more successful SEOs attracted many in-links to their page, with a clear trend
showing declining in-links for lower rankings. Accordingly, attracting many in-links is
another technique used by SEOs that would appear to have a good deal of success.
• A listing in DMoz is a technique favoured by the more successful SEOs.
• Many SEOs use older domains for higher rankings, and there may be truth
that this is a successful technique.
• The more successful pages had more del.icio.us bookmarks
3.4. Case Study: SEO for small companies
Smaller companies must continually review the pay-per-click (PPC) option or an organic
listing on search engines. The purpose of the following section is to present a case study
of a small manufacturing firm that is beginning to evaluate which search engine, Yahoo or
Google, is more cost effective. Ultimately, management identified different variables and
analytically reached to a conclusion whether PPC advertising is worth the cost to the
company. For the purpose of study, one month’s section of data from Yahoo and Google
was examined. Patterns or indications as to which key word landed a better bid position in
the PPC campaign were determined. And thus, seven consecutive campaigns for click-
through rates (CTRs), average cost per click (CPC) and average position of keywords
between the search engines Yahoo and Google were observed.
As has already been discussed in the previous sections regarding SEO techniques and, the
search engine generates a ranked listing of sites relevant to the keyword used by the customer.
The sites listed first are those deemed most relevant by the search engine based on factors like
site content, links and current updates. Typically, the organic listings are the bulk of the copy
on the screen, and each search engine has their own algorithm for ranking the list of sites.
Pay-per-click advertisements are listed on the side at a prominent place, usually shaded or noted as
‘‘sponsored’’ links so that a customer will understand that the link was purchased by the web site
business. The price paid per click is determined on an auction basis. For example, if

22. a business wants the top spot for the term ‘‘gold ring’’, it will bid up to a certain amount ‘‘per
click’’. Whenever the search engine displays an advertisement for a business web listing and a
customer clicks on it, that action leads the customer to the business web site, and the company
is charged an amount of money by the search engine company. Since this charge occurs each
time a customer clicks through to a business web site and since this cost is changed regularly
on an auction basis, it is obvious that this can be an expensive process, especially to a small
company. The question arises, is this cost necessary to the business, or is the organic listing
just as productive to the small business.
A case study: data from Kennedy Incorporated
Smaller companies are always concerned with cost-benefit analysis. At first glance, it
appears that the PPC option would be very productive for small businesses. Although it
can be costly, sometimes it is the only way a company’s web site will be seen by
customers. Also it is difficult for small companies to compete with the giants in the organic
click venue, because in the organic stream, the larger companies will generally land on top
of the list. Therefore, companies must regularly examine the cost of the PPC, and the
position they have purchased, but they must also review their web site design to ensure
that the organic listing is frequently landing the company one of the top spots of the list.
For example, good web page design should include creating specific landing pages for
popular key words. And the company’s management wanted to balance using the organic
venue and the PPC one for the profitability of their company. Kennedy decided to use the
PPC method utilizing the two largest search engines, Google and Yahoo. The question for
the company is how to best deploy its limited marketing budget.
The following two tables show different data obtained from Yahoo! and Google, respectively.

23. Within the PPC method, management first wanted to know what keyword phrases to pick
and what would be the CPC to insure them a position at the top of the sponsored list.
Management agreed that being in one of the top three positions was acceptable. For
example, the ‘‘key chain promotional product’’ had a click cost of $2.73 for first place on
the sponsored list, but dropped dramatically to a cost of $0.15 for the second position bid.
That is a huge cost differential for simply being listed second on the sponsored list. Also
that keyword only received 126 search requests, so being second or third was quite
acceptable to the company. They noticed that all the keywords that received search
requests numbering in the thousands had fairly small differentials from first to second bid
and often even to third bid. In those cases, it would be good strategy to have the highest
bid, because in spending a few pennies more the company could get the top bid.
Once the company decides on keyword phrases to use, then they would like to compare the cost of
search engines. Since Kennedy Incorporated set a budget with Google and Yahoo to stay below a
certain dollar limit, the total costs were almost the same. However, the average CPC was higher with
Google. That would make the difference in the average CPC rather significant.
Also notice that the click through rate (CTR) for Yahoo was 3.83 per cent and for Google it is
only 0.64 per cent. That number is simply the number of clicks divided by the number of
impressions. The CTR is very important, because it is the first step a consumer takes to make a
conversion to a sale. The bottom line is that for the same dollar amount of advertising spent,
Kennedy Incorporated obtained a better CTR on Yahoo than on Google. In this regard, Yahoo
outperformed Google in this Sample. Typically, a higher average position was achieved with
Yahoo as well. t is clear from the data, that Yahoo provided more traffic (e.g. more clicks) to the
web site of this small company with its limited marketing budget. Since clicks through to the
web site are the first step in the sales process, the data suggests that Yahoo provided more
value for the investment than did Google

24. 4. Display Advertising
4.1. Introduction
Display advertising is a type of advertising that typically contains text (i.e., copy),
logos, photographs or other images, location maps, and similar items. Display
advertisements are not required to contain images, audio, or video: Textual
advertisements are also used where text may be more appropriate or more
effective. One common form of display advertising involves billboards.
Display advertising also appears on the Internet, as a form of internet marketing. Display
advertising appears on web pages in many forms, including web banners. These banners
can consist of static or animated images, as well as interactive media that may include
audio and video elements. Adobe Systems Flash or .gif is the preferred presentation
formats for such interactive advertisements. The Internet Advertising Bureau, an industry
trade group, sets some standards for online display advertisement sizes and shapes.
4.2. Banner Copy Testing
Corporate Web sites serve a variety of purposes such as direct selling, projecting corporate
image, providing product information, generating qualified leads, dispensing electronic
coupons, and handling a variety of post- purchase tasks. Companies generate Web site traffic
off line through active promotion of the address uniform resource locator (URL) in collateral
advertising material and online through registration with search engines, hypertextual links
with other Websites and in some cases paid banner advertisements on other Web sites. It is
this latter method of generating traffic that concerns this section, and various testing methods
to improve the efficiency of display advertising.
Advertising banners
Advertising banners are usually small (120-500 pixels wide × 45-120 pixels high), rectangular
displays on a Web page. As banner advertisements increase in popularity, so do calls for
advertisement banner research. Web advertisers question traditional media’s cost per thousand
(CPM) pricing model based on impressions, often insisting on paying for results, click-

25. throughs, as well as, or instead of, impressions. Advertisers want to understand
who is clicking on the banner, and which factors lead to higher click-through rates.
Click-through rates
Measuring and increasing advertisement banner click-through rates are important both for
the advertiser and the Web site sponsoring the advertising. As banner pricing moves away
from CPM and towards click-through rates, both parties will work towards increasing click-
through rates. For the advertiser or advertising agency shopping rate cards, click-through
rates will help determine which Web site offers the better buy. Targeting banner
advertisements based on the content of a Web site should tend to increase response rates.
Copy testing
Traditional copy testing or communication-effect research, often uses a paper and pencil test
after exposure to an advertisement, measuring the reported change in recall, recognition or
attitude towards a product. Web banner copy testing via click-through rates has at least one
major difference when compared to most copy testing in other media; that actual behavior can
be recorded and analysed. Some of the variables identified in such tests are described below.
Specific language communications effects
The experiment focused on mechanical aspects of wording choice, rather than message
variables readership was negatively affected by an imperative in the headline, and positively by
a determiner such as “a” or “the”. Some factors having no effect on readership included the
number of adjectives, nouns, verbs or total words in the headline, presence of personal
references, and use of an interrogative form. In some cases these factors affected either
recognition of the advertisement or the ability of the respondent to associate the brand with the
advertisement. For example, use of personal references (you, your) in the advertisement had an
effect on both advertisement recognition and brand association.
The experiment
The current pilot experiment involved four different banners randomly assigned to
visitors arriving at a shopping-oriented Web page

26. Experimental design
There were four treatment conditions, or banners, which were identical except for one
line of copy. The four separate examples read: “Specializing in finding your soul
mate”, “Find your soul mate”, “Click here to find your soul mate” or just “Click here”.
The language used to create Web pages is called the hypertext markup language
(HTML). The home page for the banner contained the following HTML:
<IMG SRC=”/cgi-bin/image.cgi” >
Most often, the SRC parameter in an IMG markup points to an image file. In the
case of our experiment, however, the SRC parameter pointed to a computer
program. This program generated a random number and then used that number to
pick one of the four experimental banners.
Working hypotheses
For practical considerations, we the first banner was used as a starting point. And a
second banner was developed in a simple attempt to demonstrate that Web copy testing
could improve the efficacy of a banner. The second banner contained cleaner copy: “Find
your soul mate”. Also, the second phrase is a sentence in the active voice, a linguistic
condition associated with high-readership performance. For that and for intuitive reasons,
it was reasoned that the second banner would outperform the original.
A second goal was to evaluate the common Web advertising practice of using the phrase
“Click here” on banner advertisements. Evidence suggests that “Click here” does add to
banner advertisement effectiveness. For the third advertisement the phrase “Click here”
was added to create the copy, “Click here to find your soul mate” and it was hypothesized
that this banner would outperform the simpler version without the phrase “Click here”.
Finally, as a control condition, we the “Find your soul mate” element and an advertisement
with the simple phrase “Click here” was included. To summarize, it was expected was that
the click-through rates would increase as we went from:
• specializing in find your soul mate;
• find your soul mate; and
• click here to find your soul mate

27. With “Click here” performing somewhat worse than “Click here to find your soul
mate”. In addition, we wanted to look at the possibility that some visitor segments
had a higher click-through rate than others
Results
The 18-day experiment yielded 2,272 usable visitors. Click-through rates for the four conditions
appear in Table I. As shown, the most effective wording was simply “Click here”,
followed by “Click here to find your soul mate”, “Find your soul mate” and last was
“Specializing in finding your soul mate”
Conclusions
Copy testing can improve banner advertisement effectiveness, but the quirks and unique
features of online media will require new theories and new studies. Our most surprising result
was that the basic imperative phrase “Click here” outperformed all of the other conditions, the
fact being attributed to the curiosity variable which is added to the copy banner.
4.3. Portal Case Study: Hong Kong web site
The following section deals with identifying some key success factors related to internet
advertising, in the specific case of a portal directed at a teenage audience in Hong Kong. It also
tries to derive a generally applicable formula for measuring the effectiveness of internet
advertising. It proposes a framework for advertising effectiveness that includes traditional
objective measures (click-through rates), subjective measures applied by advertisers, and
seasonality corrections. It successfully derives a mathematical formula for measurement of
effectiveness. Extracts components from ten banner advertising campaigns at one web site
between January 2001 and May 2002, and analyses them by means of proprietary data-mining
rule-induction software. Selects two rules form the several generated, on the basis of