Survey: Web Advertising Matures, Barriers Remain

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SAN FRANCISCO -- Internet advertising has solidified its presence in companies' marketing plans, but many problems with this young medium linger, according to the Association of National Advertisers' "Internet Advertising Survey" released yesterday at @d: tech World.


Companies are beginning to ditch the brochure mentality for their Web sites. Providing information about products and services was down 22 percent among respondents asked for their top objective; although, it still was cited by 45 percent of respondents. Increasing brand awareness was a close second at 43 percent.


Improving customer brand loyalty, meanwhile, was up 12 percent from last year, with 40 percent of respondents identifying it as a top objective. Providing customer service is up 11 percent from last year, as 36 percent of respondents flagged it as a top priority.


Forty-four percent of companies surveyed have e-commerce sites, and 24 percent plan to sell on their sites within 12 months. Companies earn an average of 4.7 percent of their total revenue online.


Seventy-nine percent of sites said they didn't use a different pricing structure online, "which is interesting because customers expect a break online," said Robin Webster, executive vice president at the ANA.


The biggest issue for Web site managers was the same as last year -- lack of support from their organizations' financial and human resources departments, according to 33 percent of respondents.


However, the second biggest issue -- integrating online efforts with traditional marketing plans -- wasn't even mentioned last year. Twenty-nine percent of respondents cited this as their biggest issue.


Marketers have recognized the importance of integration, and "they realized they don't know how to do it," said Webster.


The barriers for online advertisers have shifted somewhat. Lack of proof for return on investment still scored the highest at 49 percent, but it was down 18 percent from last year. Low click-through rates weren't even mentioned last year. However, this year, 35 percent of respondents recognized them as a barrier. The lack of reliable and accurate measurement was a problem for 31 percent of respondents. Ad formats' lack of impact was up 19 percent, with 29 percent of respondents identifying it as a problem. CPMs seem to be coming back down to earth, as only 20 percent of respondents said they were a problem.


Alliances have proved extremely popular. The top three reasons for forming an alliance were co-marketing advantages, 67 percent; content enhancement, 53 percent; and technology enhancements, 35 percent.


Traffic-driving tactics have changed somewhat. E-mail was identified as a top tactic by 55 percent of respondents, up from 0 percent last year. The most popular tactic was links from other sites, cited by 76 percent of respondents. The use of search engines was second at 73 percent.


Traditional media scored third, with 69 percent citing them as a top tactic, up 23 percent from last year.


The average number of pages on a Web site is 2,300. E-commerce sites have an average of 4,600 pages, and brand sites only 500. The average number of total visitors per month is up 19 percent to 1.2 million visitors. The average number of pages viewed is nine. The average length of time spent on a site is down three minutes to 7.9 minutes. However, Webster said, this may have more to do with "better navigation and faster access."


The survey's results were derived from the responses of 114 companies. It was conducted by the ANA in the first quarter.
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