Future Trends in Online Advertising

Throughout the course of this semester, we’ve presented online advertising through many different perspectives. We’d like to wrap up our blog by giving our readers some ideas as to the direction online advertising will take in the future. We can certainly expect that online ads will not present themselves in the way they have in the past. While researching future marketing trends, I noticed that a lot of ads are presenting themselves in a more subtle manner.

 According to Business Insider, ads are now taking the approach of standing out by blending in with user content. Take Facebook for example. Have you noticed that ads are starting to blend in with your Facebook news feed?  They no longer show up only on the side bars of your screen. There have been several times that I am scrolling through my news feed and have seen an interesting video, I scroll back up, and then I realize that it’s an advertisement. Companies do this so that we don’t ignore the post simply because it’s an obnoxious ad. As you’re scrolling through your friends’ Facebook posts, your eyes are wandering from one thing to another and you’ve been advertised to without even realizing it.

Mobile ads are also becoming a hot new trend among advertisers. Today’s era is all about having smart phones and mobile access anywhere we go.  In 2013, Business insider stated that one out of every five people in the world have a smart phone and one out of every seventeen  have some sort of tablet. In America alone, 50% of adults have a smartphone. As you can see, this makes the job of advertising easy for people who are constantly in contact with the world around us. The majority of people that have a smartphone have gaming apps. These apps are usually free because the creators of the app are paid by advertisers to promote their company and or product through display ads around the parameter of the screen.

A popular advocate of mobile advertising is Amazon with their line of Kindle products. Amazon is able to make the Kindle more cost-friendly by allowing advertisers to place ads on the Kindle that cannot be removed. The consumer has the option to remove these ads by paying a $20 upcharge for an ad-free product. This is a very effective way of advertising to the consumer who values price over inconvenience. The Kindle displays these ads in two prominent locations; the lock screen and the bottom of the home screen.

In conclusion, advertisers are becoming very innovative and interactive when it comes to selling their products. What sorts of advertising trends are you noticing in the online world? Do you think ads are showing up too often and taking away from our experience while using a product or service? Do you feel like it is worth the lower price to have ads on our electronics? What do you expect to see regarding online ads in the future? Feel free to comment. We’d love to hear your thoughts and opinions!

Sources: http://www.businessinsider.com/future-of-advertising-trends-2011-7#now-learn-what-todays-ad-buzzwords-mean-7

http://www.amazon.com/gp/help/customer/display.html/ref=hp_special_subscribe?nodeId=200671290​

Online Advertisments Through Video Views

Online advertisement is prevalent almost everywhere you look.  If you go on your phone it shows up when you play games or use other apps.  If you go on your laptop then it pops up as soon as you log onto the internet.  And if you have a pop up blocker then website have become creative enough to include ads on their web pages to get around this so people are still exposed to advertisements.  Earlier in our blog posts we have talked about websites targeting certain ads to people based upon their interests but what about when you watch a TV show or YouTube video what makes those ads pop up on your screen?  I’ve seen commercials when waiting for a TV show to load about a product that I don’t even care about.  How do these TV shows and YouTube videos pick the ads that are run prior to viewing the show?  Also, when viewing a video online the ads that come in between breaks tend to be the same one on repeat? Why not mix up the commercial ads for viewers?  Why keep these ads the same?

Well as most know from online research, online ads are posted on websites by third parties.  These third party sites typically pay to have their ads posted on websites, such as YouTube, because there are many viewers.  On average there are roughly 2 billion people view videos on YouTube over a one year period, and 160 million views of videos on YouTube by mobile devices daily.  YouTube brings in roughly $450 million in revenue in a year. Similar to Google, YouTube has banners that display ads on the sides of the screen which can vary some of the ads that are viewed by people.  So the money that they make comes from their third party advertisers.

Another larger company that heavily uses online advertisement is NBC.  Particularly during the Winter Olympics it raised roughly $50 million in online ads.  Again, similar to YouTube when commercials are played before viewing the show that a viewer is trying to watch online the commercials tend to repeat themselves.  Why?  The main reason is because companies such as NBC and YouTube have sponsorship rules that they adhere to; if a third party pays enough money they can have their ad run multiple times. 

When these ads are run before viewing a video they typically are the same ads being repeated throughout the breaks of the show but they are also sometimes irrelevant to your interests.  For example, there may be a guy viewing a music video so he may not care for a Venus commercial because he has no use for a woman’s razor.   The reason why ads like this pop up is because it is difficult to judge the audience that is viewing that particular show/video without the proper tools.  These ads are used to fill the buffer space while a video is loading and it also helps generate a profit for the website. 

Do you think that websites such as YouTube and NBC should create cookies for your video views to help target the ads that you see when waiting on videos to load towards your interests?  What are your thoughts about these current dilemmas of repeated ads being displayed when running a show?  Should websites change their requirements to make it more appealing to the audience or should they leave it alone to attract more third party revenue?

Sources:
http://www.nytimes.com/2010/09/03/technology/03youtube.html?_r=0 http://www.businessweek.com/articles/2014-02-12/watching-olympics-online-heres-why-you-see-the-same-ads-over-and-over

Online Ads Can be Found Anywhere

Now that we have explained how online advertisements are used by end user, the next topic to cover is how and where companies keep their ads displayed on a website.

Online advertisements are basically seen everywhere on the web, whether it is e-commerce or content website (such as: eBay, Google). Due to the fact that they are everywhere, advertisements on the web are now becoming competitive and most companies are investing a lot of money to them. Online advertisements expense has been growing over the past years, and it is expected to grow about $17.9 billion over the next four years. Most online websites gain these profits by selling ad spaces on their webpages. But how can online website value their ads spaces on their websites?

The value of the ad display can depend on where the advertisement is located on the website and also how many times the ad was viewed. Usually websites have a standard display for advertisements. Most websites have ads banners that are shown across the top of the webpage and side bar links that display advertisements. The top ads banners tend to cost more than the bottom page ads because they are most likely to be seen by end users.

Another way that websites determine the cost of an ad is cost per click. The way this method works is by the advertiser paying a website, by how many times an end user clicks on the ad and browses the advertiser’s website. With the help of cookies, websites can keep track of user that have been on the advertisers ads. An example of a company that uses this method is Google ads, which charge more for top rank websites, because they have a higher chance to be clicked on. Having these online advertisements provides revenue for some websites, so they are able to maintain their content on the web.

As we know ads are everywhere on the web, even on piracy websites. There has been a recent controversy whether online advertiser should be penalized if they have an advertisement on a piracy website.

But why does this matter? The contents on piracy websites generally provide links use file sharing.  These links allow users to download unlicensed and illegal copyright materials such as movies and music. These piracy website are benefiting from the profits that are generated by online advertiser, which essentially means that the advertisers are contributing to this crime. The revenue produced from ads on these sites is estimated to be $227 million annually.

In most cases brands that purchase online ads are not aware that their ads are displayed on a piracy website. The reason is that the advertised brand hires a third party to send their ads to different websites, some of which are piracy sites. Should these companies be penalized even if they are not aware that their ads are on a piracy website? 

The United Kingdom is now trying to stop piracy websites from profiting from these ads. The article “Attempt to Cut Off Illegal Websites’ Advertising Revenue” explains how the United Kingdom are blocking piracy websites in hopes to cut revenues from these sites. Many argue that having the theses ads on piracy sites is hurting the credibility of the brand and companies will take their ads off these sites eventually. Then other says that if there is money to be made from these web sites, advertiser will continue to display their ads. Should these advertisers be held responsible for posting their ads on piracy websites?  Is it fair that piracy websites are gaining revenue from these advertisements? Should the United States take actions and block theses websites as well?

Sources:

http://www.bbc.com/news/technology-26788800

http://www.expertreviews.co.uk/general/1283125/online-ads-how-they-make-money-how-cookies-work-and-how-they-affect-your-privacy

http://musically.com/2014/02/19/study-claims-that-online-piracy-sites-made-227m-from-ads-last-year/