Why You Should Care About Internet Marketing
Any successful business—from a small, locally owned dry cleaner to a colossal, nationally operated department store—will agree that a large part of their success can be attributed to marketing technique they employ. The simple truth is that consumers need to know about you and products or services you offer before they can buy them from you. This is a truth companies have been acquainted with and been exploiting for years. From first newspaper advertisement printed in early 1700s to latest Internet marketing technique available today, advertising has had an impact on economy, on society, on culture, even on politics—this venture has transformed twentieth century into age of advertising firm.
What many companies don't realize, however, is that advertising technique that was so effective for their company five years ago is no longer their best option. Traditional advertising techniques, while still beneficial, are not as effective as they once were. Even once all-powerful 30-second spot on television is losing its strength with development of such innovations as TiVo and other digital video recorders (DVRs). Now TV viewers can do more than just change channel to avoid commercials: they can actually program commercials out. Consumers are gaining more control and it's beginning to have an effect on marketing industry.
If consumers are gaining control, how can marketing industry use this to their advantage? Here's a novel advertising idea: instead of pushing advertisements at people about what we think they like or will be interested in—assumptions based on general trends of an audience's demographic type—why not target what we know they want? This is exactly what Internet marketing can do for you.
The Rise of Internet Marketing
Since its birth in 1989, World Wide Web, and its worldwide use, has exploded. According to Nielsen/Net Ratings, there are now nearly 900 million Internet users worldwide, over 200 million in United States alone. Research firm eMarketer reports that U.S. adult Internet users will spend an average of $878 online this year which equates to more than over 100 billion dollars in e-commerce business being generated from United States alone.
In spite of these astounding numbers, Internet marketing—which includes such marketing techniques as e-mailing, display ads or banners, rich media, and most effective: keyword search—is only a $3 billion industry. That may seem considerable, but a study conducted by ZenithOptimedia reports that Internet marketing makes up less than 4% of global spending on advertising, putting it far behind television and newspapers which combined compose more than two-thirds of total global ad spending.
However, statistics show that spending on Internet advertising is increasing at greater percentages than spending on advertising in other media. As reported by JupiterResearch senior analyst Gary Stein at 2004 Search Engine Strategies Conference: "Spending on Internet advertising increased 27% from 2003 to 2004, while cable advertising increased 14.1%, broadcast TV advertising was up 8.2%, radio advertising was up 7.0%, magazine advertising increased 5.0%, newspaper advertising increased 4.8%, and Yellow Pages advertising was up 3.2%."
Internet advertising is growing so much faster than other forms of advertising for a reason: The Dieringer Research Group reported in late 2004 that "online product research conducted by consumers past year was responsible for driving $180.7 billion in offline spending, compared to $106.5 billion in direct online consumer spending." Interland's Business Barometer for Spring 2005, a nationwide survey of over a thousand leaders of small- and medium-sized business, showed that those businesses that are applying Internet marketing techniques are getting "a clear return in top-line revenues for their investment."
The simple truth, then, is that if your company is not dedicating a significant percentage of its advertising/marketing budget to Internet, particularly to search engine marketing (SEM), you're giving up a valuable opportunity. Marketing Sherpa claims that "so few marketers are budgeting enough for SEO [search engine optimization] that it can be a massive competitive advantage for you still." Here's why you should.