McGraw-Hill/Irwin

2004 The McGraw-Hill Companies, Inc. All rights reserved.

Chapter 17
Using Digital Interactive Media and Direct Mail
Explores the important factors advertisers weigh when considering digital interactive media and direct mail

Objectives
Discuss the opportunities and challenges of digital interactive media Debate the pros and cons of the Internet as an advertising medium Explain how Internet advertising is sold and how much it costs Assess which kinds of mailing lists are best Explain the evolution of interactive media Define the various kinds of Internet advertising Enumerate the various types of direct-mail advertising Categorize the costs associated with directmail advertising

Digital Interactive Media

6 5 4 3 2 1 0 Web Ad Spending ($billions) 1996 1998 1999 2000 2001

Internet as a Medium
Evolution of the Internet
Commercial online services
World Wide Web Provider
Home pages Web Browser Web pages Internet Service

Internet Search Engines

Website addresses

The Internet Audience

Who uses the Net?

How people access the Net

Narrowband Broadband

Cable Modem
DirecPC

DSL
WebTV

perception, Exchanges Types satisfaction Advertising of Internet

Websites
Web page

Banners and Buttons

Banner Button Rich media ad Interstitial Rich mail

perception, Exchanges Types satisfaction Advertising of Internet

Websites
Banners and Buttons

Sponsorships and added-value packages Search engine marketing

Meta ad

perception, Exchanges Types satisfaction Advertising of Internet

Search engine marketing Classified ads E-mail advertising
Spam Customer retention and relationship management (CRM) Viral marketing

perception, Exchanges Types satisfaction Advertising of Internet

Search engine marketing Classified ads E-mail advertising Problems with the Internet as an advertising medium
Using the Internet in IMC

Pros and Cons of Internet Advertising

Pros
Interactive Medium
Enormous audience Immediate response Selective targeting

In-depth information
Rapidly growing industry Reaches BTB users Advertorials Virtual storefront

Proximity to purchase
Affluent market

Pros and Cons of Internet Advertising

Cons
Security and privacy Global marketing limits Untested medium Targeting costs

Slow downloads

Exchanges theperception, Measuring Internet satisfaction Audience

Seeking standardization
Ad request Click rate

Promise of enhanced tracking

Cookies

perception, Exchanges Buying Time and Space on the satisfaction Internet

Pricing methods
Keyword purchase Click-throughs Affiliate marketing programs

perception, Exchanges Buying Time and Space on the satisfaction Internet

Pricing methods
Cost of targeting

Stretching out the dollars

Ad networks

perception, Exchanges Global satisfactionthe Internet Impact of

Online ad spending: $71 billion
Online Ad Spending
Africa
Asia/Pacific

U.S. Europe

Canada

Latin Am Middle East

perception, Exchanges Other Interactive Media satisfaction

CD-ROM Catalogs and magazines Kiosks Interactive TV

Direct Mail Advertising: The Addressable Medium

Growth of direct mail Types of direct mail
E-mail Broadsides

Sales letters
Postcards Business reply mail Folders and brochures

Self-mailers Statement stuffers

House organs Catalogs

Direct Mail Advertising: The Addressable Medium

Growth of direct mail Types of direct mail Using direct mail in the media mix

Pros and Cons of Direct-Mail Advertising

Pros
Selectivity Coverage and reach Flexibility Personal Impact Exclusivity Response

Control

Testability

Pros and Cons of Direct-Mail Advertising

Cons
Selectivity problems Negative attitudes Environmental concerns High cost per exposure Delivery problems

Lack of content support

Buying Direct Mail Advertising

Acquiring direct-mail lists
House lists Compiled lists Mail-response lists

Production and handling

Letter shop

Distribution