Branding is Back on the Web

[garyp]

On the Web, Branding Is Back
Business Week
http://www.businessweek.com/technology/content/aug2004/tc20040820_2029_tc024.htm

Sarah Lacy from Business Week writes about the increase of video-style ads on the web and how it might signal a "brand-ad rebound."

While paid search advertising, where companies buy placement in search results from sites such as Google and Yahoo, was all the rage in 2003, online branding is gaining steam this year and may become the strongest growth story of Net advertising in 2005.

The growth in rich-media advertising, which is where the bulk of brand-ad dollars are going, is expected to outpace growth in paid search this year and continue at a faster clip through 2006, according to researcher eMarketer. It's still a fraction of search advertising, though: Total online ad dollars going to search in 2005 are projected at just under $5 billion, vs. $1.5 billion for rich media.

Perhaps the biggest indicator of growing demand for brand ads is an increase in prices. The cost of brand ads on portals has jumped 68% year-over-year, while entertainment sites have seen spikes as high as 90%, according to Jeff Lanctot, vice-president for media at Avenue A, an online advertising agency. Lanctot notes that many of the spaces being offered at higher prices are larger and more media-rich, so advertisers are getting more bang-for-the-buck for those increased dollars.

[MUSCLE13]

Nice. We were just discussing this topic yesterday on the Jeeves forum. Thanks for the article. For the internet to grow as a dominant advertising medium there is no doubt search and branding both have to contribute. Broadband should help both grow.

[garyp]

Broadband should help both grow.

and speaking of broadband helping...

Have you've seen the news that broadband usage at home in the U.S. is now over the 50% mark? (http://biz.yahoo.com/prnews/040818/sfw027_1.html)

[NFFC]

By branding, are we refering to ads that don't get clicked?

[MUSCLE13]

and speaking of broadband helping...

Have you've seen the news that broadband usage at home in the U.S. is now over the 50% mark? (http://biz.yahoo.com/prnews/040818/sfw027_1.html)

Great stuff! Broadband is here to stay. A lot of momentum in internet advertising spurred by several positive developments. Kind of reminds me of the old days, except this time its a real business. Thanks for the links Gary.

[Chris_D]

branding..... ads that don't get clicked

Advertising agency spin 101. LOL

Client: "I thought Search Engine Marketing was the most successful way to generate sales leads on the web?"
Agency: "err yes - but this wasn't a direct response campaign, it was a branding campaign"
Client: "What's the difference"
Agency: "you didn't get any leads, and you didn't sell anything..."

:)

[Mikkel deMib Svendsen]

Client: "I thought Search Engine Marketing was the most successful way to generate sales leads on the web?"
Agency: "err yes - but this wasn't a direct response campaign, it was a branding campaign"
Client: "What's the difference"
Agency: "you didn't get any leads, and you didn't sell anything..."

Thats too funny!
- But, only because there are some truth to it. Why is it that we suddenly get all this branding when click rates drop. Wasn't the branding effect there all along?

It's OK to highlight different qualities of a product but it just often reminds me of a poor sales pitch when I get the "branding talk" from medias that want my clients money - medias with low click rates, or low qiuality of clicks. But, if there is hardly any clicks, and if any of a very poor quality how good is the branding effect? Isn't the branding effect better from medias that documents higher click through rates as it show a better match with users interest?

There is a lot of "branding money" out there. No doubt. And, off course I want more of that money to go to search. I just think it's important to find out more about where you can improve your brand the best: Is it better to spend your branding resources on making sure your company appear in the front of users in your target group as they research and search your "space"? Or, is it better to suck up more and more of users broadband bandwith with bigger and more intruding ads?

[MUSCLE13]

It seems many here don't understand that the big fortune 500 companies make up the large majority of the 200 billion dollar plus annual advertising in this country sometimes with individual companies having billion dollar plus ad budgets. For the internet to grab companies like Coca Cola , General Motors or Paramount movie studios branding is the only way. I seriously doubt these companies are interested in click throughs. They are interested in getting in front of as many eyes and ears as possible The Businessweek article stated this --

Still, branding ads are a trickier sell for even the big portals because it's harder to measure their impact. Forget about counting clicks, says analyst Gary Stein of Jupiter Research. The only real way to measure the effect is through pre- and post-campaign surveys, detailing whether people exposed to the ads were more likely to buy the product.

[rcjordan]

"Brand metrics can be viewed as Accountable through pre- and post-analysis but these are not the true metrics that a shareholder or a board member wants to hear. They want to see sales and business growth"

http://www.mediapost.com/PrintFriend.cfm?articleId=257688

Branding campaigns are very convenient for the ad agencies using a Wanamaker-esque defense of their services. I think it was either Tom Hespos or Tig Tillinghast that wrote an OnlineSpin article a few years ago titled "Accountability? We Don't Need No Stinkin' Accountability!" which was an insider's rant about agencies side-stepping the ROI issue and covering it up with "branding talk" as Mikkel calls it. (The article seems to have evaporated, if anyone has a link, please post it.)

> branding ads are a trickier sell

And even a trickier buy. A media agent that comes to the web thinking that his tv and/print expertise translates directly to the web is likely in for a rude awakening --but, never fear, he can always blame it on the website.

[MUSCLE13]

So why are rich media ads growing faster than search ads this year according to BusinessWeek? I think search is awesome. My opinion is search will replace the $15 billion yellow pages industry. Branding will always be huge in advertising too. Especially with the proliferation of broadband. I think Mikkel has made excellent points on the intrusion of banner and rich media ads though. That is certainly a negative.

[Mikkel deMib Svendsen]

The fact that fortune 500 companies spend billions on branding (outside of search) dosen't make it the best way for them to spend money. That's just what they do and therere is a long line-up of people that profit from that. Large companies spend large money but often waste too much of it on thin air. However, that has never kept the people that profit from that thin from "producing" whatever arguments they can to keep the budgets. Thats understandable but it dosen't mean I will jump on the brand wagon just for the budgets.

I've seen large corporations spend two digit millions on websites that should have cost no more than a few hundred thousands - at the most. I've seen managers at the same companies waste thousand of dollars on expensive consultants mostly to cover their own back - to not have to be responsible for anything. And, it's the same companies that (in my opinion) waste way too much money on ghost branding talk.

I agree with rcjordan, I believe the stock holders look more at the numbers. It's fine with a better brand and all that but if it dosen't produce real values that translates into more money to the stockholders I am not sure they will eat the brand talk for long. If management can show an improved brand along with more profits then fine, but if all they show year after year is an improved brand and no profits I am not sure the stockholders will let that management stay. I hope not.

For the search engines it may be a disireable thing to get a bigger chunk of the branding billions but I am not sure it is for me. With those billions, I am afraid, comes new people to the table. The branding gang. If they suddenly flood the search business with billions I am not sure what direction it would take and if it would be good for the quality of search.

So no, I am not sure I want all those branding billions to float into this business. There seems to be plenty of billions comming from companies that understand and profit from the current models we have on the market. Plenty to make many of us rich and plenty to keep some good engines alive. I am not sure the branding billions will make me any more happy about my work or any more rich. The search engine stockholders might get richer but do I care much about that? Not a bit :)

[MUSCLE13]

For the search engines it may be a disireable thing to get a bigger chunk of the branding billions but I am not sure it is for me.

My question is how does search get a bigger chunk of branding? Doesn't seem like that is happening if rich media ads are growing faster than search this year according to the article. Seems to me that points towards portals and advertising networks being just as important to internet advertising growth as search.

[MUSCLE13]

I did notice that Google added some banners and Skyscrapers to their AdWords syndication network. I think Jeeves does some of that branded response search too. I guess thats a way to add branding to search. Do you guys think branding is going to become a big part of search? I have doubts. I think its a portal game.

[Chris_D]

why are rich media ads growing faster than search ads this year according to BusinessWeek?

Because rich media ads are growing from a very small base.

Total online ad dollars going to search in 2005 are projected at just under $5 billion, vs. $1.5 billion for rich media

[Mikkel deMib Svendsen]

I think its a very limited view that branding is just about images. Are you saying there is only a branding effect in search if it carries graphics? I do not agree with that

[MUSCLE13]

Because rich media ads are growing from a very small base.

Kind of like search was coming off a very small base a couple of years ago. I think broadband is spurring rich media a lot.

[MUSCLE13]

I think its a very limited view that branding is just about images. Are you saying there is only a branding effect in search if it carries graphics? I do not agree with that

Yes I believe images, motion and animation add a lot to the branding effect. Unfortunately rich media ads are more intrusive as you have pointed out. Thats definitely a negative. When you think about it the internet was supposed to be the information superhighway not the video graphics superhighway. I do believe broadband will bring a lot more rich media to the net though.

[doppelganger]

Oftentimes, companies do not have any effective measurement on thier sites that can make search campaigns direct reponse. Take a restaurant, for example. Sure, they might be able to use a restaurant locator or something like that for a measurable response, but it would take some justification... They can't very well measure how many people come through the door from a search ad...

There have been studies that show the branding for search being much higher than any other online ad format. I think that search is too direct-response oriented, and I would like to see more dollar go into using search for branding purposes. Often the client just wants more eyeballs on their site...

[garyp]

Branding gets more coverage. This time branding when it comes to search engines.
Naseem Javed shares his thoughts in a commentary for E-Commerce Times.

The Importance of Search Branding
E-Commerce Times
http://www.ecommercetimes.com/story/36089.html

The industry urgently needs a quick crash course in branding. Otherwise, connecting with potential customers will become a very tough challenge. Lucky are those who have a short and clear dot-com brand. Customers can simply go directly there -- like Sony.com or PlayStation.com.

[andrewgoodman]

I'm guessing Javed isn't an advocate of keyword-rich, hyphenated domains. ;)

[seobook]

I'm guessing Javed isn't an advocate of keyword-rich, hyphenated domains. ;)

I think there is a brandable market for super hyphenated domains for the first guy who makes a funny site about spam who uses a bunch of hypens in the domain name.

perhaps hy-phen-ated-spam-esq-domain-buy-here-now-good-stuff-i-promise-half-off-today-only.com or something...