Math and Magic of Online Advertising
Course: Public Relations and Advertising in a Digital Age
Dr. Tao Papaioannou
University of Nicosia
TOC \o "1-3" \h \z \u Abstract PAGEREF _Toc388000695 \h 31.Introduction PAGEREF _Toc388000696 \h 42.Literature Review PAGEREF _Toc388000697 \h 53.Analysis PAGEREF _Toc388000698 \h 63.1.The Evolution of Commercial Web PAGEREF _Toc388000699 \h 63.2.Consumer Model of Online Advertising PAGEREF _Toc388000700 \h 83.2.1.Intrusive Online Advertising PAGEREF _Toc388000701 \h 83.2.2.Non- intrusive Online Advertising PAGEREF _Toc388000702 \h 93.3.The Math and Magic of Online Advertising PAGEREF _Toc388000703 \h 94.Conclusion PAGEREF _Toc388000704 \h 115.Methodology PAGEREF _Toc388000705 \h 11Bibliography PAGEREF _Toc388000706 \h 13APPENDICES PAGEREF _Toc388000707 \h 15Appendix A PAGEREF _Toc388000708 \h 15Appendix B PAGEREF _Toc388000709 \h 17
AbstractFor the larger part of 90’s, the earliest forms of online advertising, including e-mail advertisement, pop-up ads and banners, were perceived as spam. Today, online advertising has become an integral part of the industry as a result of new emerging technologies and shifts in consumers’ culture. With rapid global growth, online advertising will continue to strengthen its importance and integration within corporations’ marketing strategies. This paper examines the evolution of online advertising up to date and discusses the possible future trends that will shape the advertising industry as a whole.
IntroductionOver the last two decades, online advertising has evolved not only banners, pop up ads and e-mail adverts, but various other formats and concepts that have forever influenced the advertising industry. Most recently, not only new formats of online advertising have been introduced in the form of video advertising, in-line text ads and adverts in online gaming, but also new approaches in targeting audiences online and contextualizing the adverts. In 2013, internet advertising expenditures in USA hit $42.8 billion in revenues and for the first time in history surpassed the revenues of TV broadcast advertising ($40.1 billion). In comparison to 2012, online advertising in USA has marked 17 % growth. Although in Europe online advertising revenues are considerably smaller in comparison to US and account for £6.3 billion, the European online advertising market also marked 15.2% growth in comparison to 2012. Both markets’ online advertising is growing due to increasing number of online users worldwide. As of 2012, nearly 2.5 billion people, 34.3% of world’s population, were online. The largest internet population, 44.8%, represents Asian market, with Europe following second, at 21.5%, and North America as third with 11.4% internet users in the world.
Figure 1: Distribution of Internet Users Worldwide (2012)
A decade of research on online advertising enables this paper to offer an insight into its evolution from being merely a branch of advertising into an advertising and money- generating machine. Moreover, research provides us with information about different forms of online advertising, as well as current trends and enables future predictions of this ever-changing, fast-paced industry.
Literature ReviewFor the purposes of the present paper, numerous sources were used to support the thoughts regarding the history and future of online advertising. Sources include well balanced mix of books, online articles and statistical information for the optimal representation of the topic. This section includes short review of the main sources that provided most of information, whilst other sources, from which smaller chunks of information were taken, are listed at the end of the paper, in Bibliography.
Briggs, R. (1998, March). “A road map for online marketing strategy”, Admap, 27-31.
Briggs argues that online advertising builds brands through the use of its different formats, in particular...