Chapter 13:
E-Marketing Communication: Paid Media
Learning Objectives
Paid Media
Paid media are properties that are paid by an organization to carry its promotional
messages. The terms paid media and advertising are often used interchangeably.
The line between physical (also called traditional or offline) and digital platforms
Trust in Paid Media
Globally, consumers trust earned media the most, followed by owned media, and
then paid media. Despite criticisms, paid media are still very effective for building
awareness and moving users to owned media. Online advertising is growing.
Internet Advertising Trends
Internet advertising in the United States began with the first series of banner ads
on Hotwired.com in 1994. In 2012, internet firms might capture 23.3 percent of
advertiser dollars and, for the first time ever, surpass the amount spent on
traditional print advertising.
Paid Media Formats
Anything goes with paid media online: text—from a sentence to pages of story—
graphics, sound, video, hyperlinks, or an animated car driving through a page.
Many of these ads also have interactive capability.
Display Ads
Online display ads are embedded in Web pages, allowing users to click
Rich Media Ads
All ads in this category are highly interactive, at least offering click-
through to the advertiser’s Web site, where the transaction or any other
objective is achieved. Formats include the in-banner video ad,
expandable/retractable ad, pop-up, pop-under, floating ad, interstitial ad,
wallpaper ad, trick banner, and map ad.
Contextual Advertising
Ad servers maintain an inventory of display ads from clients and serve
E-Mail Advertising
Sometimes, the least expensive type of online advertising is e-mail
advertising—paid content embedded in another firm’s e-mail. Advertisers
purchase space in the e-mail sponsored by others, often an e-mail
newsletter.
Text Link Ads
These are ads that are simply a hyperlink placed in specific text in a blog
post or other owned media content—including content downloaded
by mobile phone users.
Sponsored Content
Sponsorships integrate editorial content and paid media based on either
Classified Ads
Classified ads are placed both by individual consumers and by companies.
These usually use text, but may also include photos. Many daily
Product Placement
Online gaming creates huge special interest communities and product
Social Media Advertising
Advertising spending on social media advertising is predicted to grow 15 percent
to 34 percent faster than search advertising over the next five years. Display ads
do not take advantage of the unique properties of social networks, which have
three unique aspects:
Personal profile — Social networks contain personal profiles’ data,
including the member’s name, image pictures, and demographic
information.
Social data graph — Companies can make a map or list of all the
Paid Media on Facebook
Advertisers can reach over 1 billion active members by advertising on the
Facebook social network. However, most advertisers prefer more narrow
targeting to reach their well-defined markets, and this can easily be done
via member profile information.
Facebook-Sponsored Stories
In January 2011, Facebook added an interesting feature called sponsored
A social ad has three criteria: profile data, interaction data, and social
graph (friend connections).
Twitter’s “Promoted Tweets,” “Trends,” and “Accounts”
Barking at Facebook’s heels, Twitter is a strong competitor for
advertisers’ dollars. Promoted tweets are ads that appear as content at the
Advertising in Second Life
In Second Life, companies can pay virtual clubs, stores, or malls to put up
posters or kiosks featuring brand information and links, and can even
provide “teleports” to the company’s virtual property.
LinkedIn Advertising
size, (3) seniority or age, or (4) LinkedIn Group membership.
Paid Media in Online Videos
Mobile Advertising
Smartphones and tablets have high penetration and several companies predict that
mobile internet usage will surpass computer internet usage by 2014. While mobile
advertising is still only 6 percent of the online advertising pie, according to the
Economist, “Marketers hail the mobile phone as advertising’s promised land.”
Following are the mobile advertising formats available to marketers:
Paid search — Advertisers can buy keywords that appear as sponsored
links on mobile search engine results pages.
Display ads — Users pull content from mobile Web sites and banners,
flash, or other types of ad formats come along for the ride.
Full screen takeovers — Say Publishing offers a mobile display ad
platform involving an ad image taking over the entire mobile screen.
Paid Search
Paid search occurs when an advertiser pays a search engine a fee for directory
submission, inclusion in a search engine index, or to display its ad when users
type in particular keywords.
Keyword advertising at search engine sites prompts sponsored text or
display ads to appear on the SERP (Search Engine Results Pages).
Which Media to Buy?
Beyond the target, product, and campaign goals, marketers consider media
characteristics, effectiveness, and efficiency. Each medium has unique
characteristics for achieving goals. Media planners want both effective and
efficient media buys. Effectiveness means reaching and gaining the attention of
the target market, and efficiency means doing so at the lowest cost.
Effective Internet Buys
Media planners look for the media with audiences that closely match the
brand’s target markets. Marketers use many innovative digital strategies to
Paid Media Performance Metrics
There are hundreds of performance metrics to choose among, but the best ones
will be those that closely match the campaign’s objectives. Regardless, most
marketers still rely heavily on click-through metrics as a starting point because it
is an easy measure to get and helps to compare various tactics.
Effectiveness Evidence
When viewed as a direct-response medium, display ads are generally
ineffective: Only 0.2 percent of all users click on them. However, many
individual firms have received stunning click-through results with
carefully targeted offers to prospects.
Metrics Example
Chapter Summary
Many media are paid to carry an organization’s promotional messages
such as online advertising, product placement, and sponsored tweets. Paid media
are generally used to build awareness, move users to owned media and,
ultimately, engage them in earned media. The most important paid media
technique is paid search advertising, followed by display banner ads, classified
ads, mobile ads, and social media. Paid display ads include rich media ads such as
Chapter Outline
Opening Vignette: Lenovo Wins Big with Paid Media
Have the class read the opening vignette on Lenovo’s big win with paid media.
Discuss with the class how Lenovo’s purchase of Google Display ads, combined
with an innovative remarketing strategy, succeeded in boosting personal
computer sales and reducing advertising expenses during 2010.
www.lenovo.com
I. Marketing Communication Media
Communication media are tools for disseminating information, such as an online
video, the newspaper, and e-mail. These items are either paid or free and the lines
between physical and digital platforms for marketing are blurring more everyday.
.
A. Media Characteristics – traditional media and digital media
characteristics are studied so companies can make appropriate
decisions when buying promotional space.
1. Broadcast Media
a. Television
I. Paid Media
A. Properties paid by an organization to carry its promotional messages
B. “Paid media” and “advertising” often used interchangeably
II. Trust in Paid Media
A. Globally, consumers trust earned media the most
B. This is followed by owned media, then paid media
III. Internet Advertising Trends
A. Internet advertising in the United States began with the first series of
banner ads on Hotwired.com in 1994
IV. Paid Media Formats
Anything goes with paid media online: text—from a sentence to pages of story—
graphics, sound, video, hyperlinks, or an animated car driving through a page.
Many of these ads also have interactive capability.
A. Display Ads
2. Enable users to click through to the advertiser’s site
B. Rich Media Ads
1. Highly interactive, at least offering click-through to the
advertiser’s Web site
2. Formats:
a. In-banner video ad
b. Expandable/retractable ad
c. Pop-up, pop-under
3. Video, animated, and highly interactive display ads require
C. Contextual Advertising
2. Ad system scans a Web page for content and serves an
appropriate ad
previously visited a Web site.
D. E-Mail Advertising
1. Sometimes, the least expensive type of online
3. Advertisers purchase space in the e-mail sponsored by others
E. Text Link Ads
2. Includes content downloaded by mobile phone users
F. Sponsored Content
1. Integrates editorial content and paid media based on:
G. Classified Ads
1. Placed by individual consumers and companies
3. Many daily newspapers have suffered due to classifieds
H. Product Placement
1. Online gaming creates special interest communities and
product placement opportunities
I. Emerging Formats
1. Anything goes and novelty gains attention
2. Fertile ground for the creative advertiser
V. Social Media Advertising
2. Social data graph: Map or list of all the connections between
individuals to determine network size for like-minded people
B. Paid Media on Facebook
2. Most advertisers prefer more narrow targeting to reach well-
defined markets
1. Sponsored stories integrate social endorsement into ads
2. Includes:
a. Domain stories
b. Page like stories
D. Social Ads
2. Interaction data
E. Twitter’s “Promoted Tweets,” “Trends,” and “Accounts”
1. Promoted tweets appear as content at the top of a Twitter
search page or user’s timeline
3. Promoted account ads are featured in search results and in the
F. LinkedIn Advertising
1. Great for advertising to narrowly targeted business
professionals
2. Advertisers can target by:
a. Job title and function
G. Advertising in Second Life
1. Companies can pay virtual clubs, stores, or malls to put up
H. Paid Media in Online Videos
2. Many sites available, including YouTube and Vimeo
3. Types of ads:
a. In-stream videos
VI. Mobile Advertising
Smartphones and tablets have high penetration and several companies predict
that mobile internet usage will surpass computer internet usage by 2014. While
mobile advertising is still only 6 percent of the online advertising pie, according
to the Economist, “Marketers hail the mobile phone as advertising’s promised
land.”
A. Mobile advertising formats available to marketers:
2. Display ads — Users pull content from mobile Web sites and
banners, flash, or other types of ad formats
4. Messaging — Short message services (SMS) have broader
reach than many other formats
6. Video — A slowly growing area because videos take up a lot of
bandwidth and are lengthy to download
8. Apps — The iPhone and iPad put mobile apps on the map.
B. Mobile ads are a new area with great promise and many unanswered
questions.
VII. Paid Search
Paid search occurs when an advertiser pays a search engine a fee for directory
submission, inclusion in a search engine index, or to display its ad when users
type in particular keywords.
A. Keyword advertising at search engine sites: sponsored text or display
VII. Which Media to Buy?
Beyond the target, product, and campaign goals, marketers consider media
characteristics, effectiveness, and efficiency. Each medium has unique
A. Effective Internet Buys
1. Media with audiences that closely match the brand’s target
markets
3. Buying space with search engines to reach the largest number
B. Efficient Internet Buys — to measure efficiency, media buyers use:
1. CPM (cost per thousand impressions)
3. CPC (cost per click)
VIII. Paid Media Performance Metrics
There are hundreds of performance metrics to choose among, but the best ones
will be those that closely match the campaign’s objectives. Regardless, most
marketers still rely heavily on click-through metrics as a starting point because it
is an easy measure to get and helps to compare various tactics.
A. Effectiveness Evidence
1. Display ads generally ineffective when viewed as a direct-
B. Metrics Example
Consider the actual internet buy made by iGo, an online retailer