Internet Advertising and Behavioral Targeting

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Table of Contents

Abstract
Introduction
Discussion
Literature review
Critical Issues
Recommendations
Conclusion
References

Abstract

This research paper is dedicated to the studies on Internet advertising and behavior targeting. It aims at shredding light at these notions and analyzing them by means of utilizing correspondent sources, i.e. books and articles which discuss the topics connected with these notions.

Introduction

In the modern world of innovative technologies the number of Internet users is ever-increasing. Internet advertising can be beneficial for users since they can have access to Web sites irrespective of the country they live in; they do not have to communicate directly with the suppliers being able to do it through e-mail. Some of Internet users consider Internet advertising necessary and entertaining whereas others have negative attitude toward it. It is necessary to discuss the notion of Internet advertising and its constituents in order to ensure proper behavior targeting which would help make Internet more beneficial for the consumers.

Discussion

Internet Advertising

Internet advertising is necessary for online firms which promote their products and, since Internet is used worldwide, such kind of advertising allows selling more products. “Advertising directly confers brand and product information to consumers, and it serves to increase consumers’ awareness and knowledge of a particular brand” (Clarke & Flaherty, 2005). To do this, such procedures as scheduling and personalization can be applied. The main goal of the former is to maximize the total click-through rate for all advertisements by appropriately managing of exposition time and advertising space on the web page, whereas the latter aims to assign a suitable advertisement to the user (de Bra & Nejdl, 2004). When the scheduling is applied successfully, more people become attracted by the Internet advertisements. Among the factors which influence users’ clicking on the advertisements is the alluring offer they propose or just a fetching design of the advertisement.

Challenges which IA may face

However, Internet advertising is not all about advantages alone. Not all people like Internet advertising which sometimes can be annoying. Most of people use Internet for specific purposes, for instance, checking e-mail or looking for particular information. Internet advertising can be sometimes distracting and obtrusive which makes the users irritated. Another great challenge Internet advertising can face is generating interests of the users. In today’s world of constantly developing technologies and with Internet’s introducing innovations daily, certain measures should be taken in order to attract consumer’s attention. One of the best suitable solutions to this is applying behavior targeting.

Behavior Targeting

It is a common knowledge that “the primary purpose of advertising is to influence purchaser behavior” (DeThomas, Grensing-Pophal & Grensing, 2001). This is why, when planning Internet advertising, behavioral targeting should be taken into consideration above all. Targeting “refers to an advertiser’s attempt to reach a desired audience” (Sweeny, 2008); when it comes to Internet advertising, behavior targeting consists in placing the advertisement in a right place in order to attract attention to it in a best possible way. In general, “targeting online customers is very similar to the offline world and consists of two major steps: defining the target markets and executing a contact strategy” (Drozdenko & Drake, 2002). By defining the target markets the advertiser can realistically evaluate his/her future success with promoting his/her product and a clear strategy will help him/her achieve this success. Thus, behavior targeting “makes online advertising more targeted and relevant” (Lee & Johnson, 2005), this is why it should never be underestimated by the advertiser.

Disadvantages of behavior targeting

There is no doubt that behavior targeting is beneficial for Internet advertising but the fact that it has its own disadvantages cannot be denied. One of its greatest flaws is that once it defined a user as a target, there is no way escaping it. The advertising will pursue the users “no matter where they go on a Web Site or even other sites as well” (Lee & Johnson, 2005).

Literature review

Six articles containing relevant information regarding the topic of the research paper have been studied and evaluated. All articles have different themes; for instance “Survey of Internet Users’ Attitude toward Internet Advertising” written by Ann E. Schlosser, Sharon Showitt and Allaina Kanfer discusses the attitudes of the users toward Internet advertising; “Advertising and Consumer Information Online” by Ronald Faber, Mira Lee and Xiaoli Nan describes the constituents of the IA and “provides a brief review of findings regarding each of them” (Faber et al., 2004); the aim of the article “Consumer Reactions to Online Behavioral Tracking and Targeting” by Pamela Alreck and Robert Settle, is to measure “three aspects of consumer reactions to online behavioral tracking and targeting” (Alreck & Settle, 2007); “Why do People Avoid Advertising on the Internet?” by Chang-Hoan Cho and Hongsik John Cheon “builds a comprehensive theoretical model explaining advertising avoidance on the Internet” (Cho & Cheon, 2004). Just like the first article it describes the users’ attitude toward the IA but is more focused on the negative attitudes. However, unlike the second and the third article, it neither concentrates on the constituents of the IA nor discusses consumer behavior. The article “Internet Advertising: is Anybody Watching?” by Xavier Dreze and Francois-Xavier Hussherr investigates “online surfers’ attention to online advertising” (Dreze & Hussherr, 2003); it discusses important issues on why people watch IA and can be contrasted with the article on why people avoid watching IA. The final article “Banner Advertising: Measuring Effectiveness and Optimizing Placement” by Lee Sherman and John Deighton does not relate to any issues mentioned above; it simply presents the information on “how one company improved banner advertising response rates by taking advantage of the medium’s rich data to optimize placement” (Sherman & Deighton, 2001).

Some of the articles provide definitions which can be valuable for the research paper. Thus, the first article describes the IA constituents stating that it includes “many forms of commercial content – from electronic advertisements that are similar to traditional advertisements (e.g., billboards, banner ads) to formats that are different from traditional advertisements, such as corporate Web sites” (Schlosser et al., 1999). All the articles draw different conclusions depending on the topic they focus at. “Survey of Internet Users’ Attitude toward Internet Advertising” finds out the number of users who like, dislike or feel neutral about the IA. “Consumer Reactions to Online Behavioral Tracking and Targeting” is the only article which examines how much the users know about behavior targeting; the article discovered that only an insignificant number of uses were unaware of this issue. Lastly, the study conducted in the article “Internet Advertising: is Anybody Watching?” revealed that 50% of users turn attention to banner ads, which shows that half of all the users get attracted by the advertisements’ offerings or bright colors. What unites all these articles is that they insist on further development of the topic presented in them, emphasizing that the number of users is constantly changing, as well as IA is subjected to innovations, which will influence future results of the studies conducted on Internet advertising and behavior targeting.

Critical Issues

One of the critical issues related to Internet Advertising is its effectiveness. The matter is that it is difficult to determine whether traditional Web media such as, for example, pop-ups and banners are more efficient than click-throughs or outcomes, which constitutes a great problem for choosing the way to deliver a message to a customer. For instance, the article “Internet Advertising: Is Anybody Watching?” states that banner ads are inefficient because they are designed to grasp the user’s attention, and if they fail to do so, the users simply do not click on them; moreover, some of users avoid even looking at banners. The article concludes that the richer in content the banners are, the more their messages “influence both aided advertising recall and brand recognition” (Dreze & Hussherr, 2003). Another critical issue is that most of the methods to influence consumers are obsolete and it is necessary to broaden the idea of how to promote products in the best efficient way and to determine what exactly the consumers need. In other words, tracking the audience becomes more and more problematic and the Web is soon going to need its own marketing to find out which advertisements reach customers most efficiently. The article “Consumer Reactions to Online Behavioral Tracking and Targeting” also addresses one of these critical issues, namely, influencing the customers. The article advises to differentiate between old and new potential customers; the idea is to attract the potential customers by the biggest possible discounts or free shipping: “Doing so is based on the premise that the customer is likely to return and purchase at prices more lucrative to the seller” (Alreck & Settle, 2007).

Recommendations

Possible recommendations on Internet Advertising include making advertising identifiable, which means that the company which promotes its products via the Internet should be well-known to the customers (it should have a familiar name and location for the customers to know where to turn for advertised products). Thus, the companies are expected to provide consumers with the most full contact information (phone numbers and e-mail addresses), information about terms and conditions of delivery, prices, and possible refunds (it is necessary to make all of these most beneficial for the customer).

Conclusion

Taking into consideration everything mentioned above, it can be stated that Internet advertising can be beneficial for the users because they have access to it irrespective of their location and because they do not have to communicate with suppliers directly; however, sometimes IA can be annoying and distracting. Behavior targeting is vital for Internet advertising, though, as discussed in numerous studies, it has its own problems of implementation which should be thoroughly studied. Moreover, the researchers should not stop at the achieved results because data are constantly changing due to the increasing number of Internet users. The studies on Internet advertising and behavior targeting should be regularly conducted and updated in order to observe all the existing behavior patterns and to succeed in the sphere of Internet advertising.

References

Alreck,P.L., Settle, R.B. (2007). Consumer Reactions to Online Behavioral Tracking and Targeting. Journal of Database Marketing & Customer Strategy Management, 15, 11

Clarke, I., Flaherty, T. (2005). Advances in Electronic Marketing. Idea Group Inc (IGI)

De Bra, P.M.E., Nejdl, W. (2004). Adaptive Hypermedia and Adaptive Web-based Systems: Third International Conference, AH 2004, Eindhoven, The Netherlands: Proceedings. Springers

DeThomas, A., Grensing-Pophal, L., Grensing, L. (2001). Writing a Convincing Business Plan. Barron’s Educational Series

Drozdenko, R.G., Drake, P.D. (2002). Optimal Database Marketing: Strategy, Development, and Data Mining. SAGE

Faber, R.J., Lee, M., Nan, X. (2004). Advertising and Consumer Information Online. AMERICAN BEHAVIORRAL SCIENTIST, 48(4), 447

Lee, M., Johnson, C. (2005). Principles of Advertising: A Global Perspective. Haworth Press

Schlosser, A.E., Shavitt, S. and Kanfer, A. (1999). Survey of Internet Users’ Attitude toward Internet Advertising. Journal of Interactive Marketing, 13(3), 34

Sherman, L., Deighton, J. (2001). Banner Advertising: Measuring Effectiveness and Optimizing Placement. Journal of Interactive Marketing, 15(2), 60

Sweeny, S.(2008). 101 Ways to Promote Your Tourism Web Site: Proven Internet Marketing Tips, Tools, and Techniques to Draw Travelers to Your Site. Maximum Press

Cho, C-H., Cheon, H.J. (2004). Why Do People Avoid Advertising on the Internet? Journal of Advertising, 33(4), 89-97

Dreze, X., Hussherr, F-X. (2003). Internet Advertising: Is Anybody Watching? Journal of Interactive Marketing, 17(4), 8

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