Online Marketing: Advertisers Have a Banner Year
Lower Internet ad rates enable them to reach
more eyeballs for less money
Copyright
© 2001 Investor's Business Daily- Full text in March 9, 2001
edition. Below are excerpts involving Astrocenter.com
By Jed Graham
[A]necdotal
evidence from ClassMates.com and Astrocenter.com, an
online astrology site that's been among the top advertisers
since December, suggests that it might pay off to aggressively
advertise online while everyone else is being cautious. ...
So how can this little company
afford to buy more online advertising than most anyone?
One answer is that ad rates have
come down sharply.
The average CPM price quoted by
Web sites that sell advertising is about $25, down from $35
a year ago, says Charlie Buchwalter, vice president for media
research at AdRelevance, a unit of Jupiter Media Metrix Co.
But that's before the bargaining starts, he says.
The average price actually paid
by advertisers in 2000 was more like $3.50 and should decline
another 10% this year, says a recent report from Morgan Stanley
Dean Witter.
Publishers Still Need Revenue
"There is a lot of (ad space) inventory
out there that is currently unsold," said Nick Pahade, managing
director at Ann Arbor, Mich.-based digital advertising agency
Beyond Interactive Inc., whose clients include ClassMates.com.
"Any time the economy is on the decline, advertising tends
to be a little softer. Publishers want revenue, that's the
bottom line, so they'll consider things they might not have
in the past."
Many dot-com advertisers have gone
out of business, but even successful Internet firms seem to
be holding a tight purse, says Weiner of NetRatings.
"Companies are going through a
period right now where they're being extremely cautious,"
Weiner said. But the ability of small advertisers to stand
out also stems from the maturing of the Internet, he says.
For one thing, companies like Yahoo
do most of their advertising internally through "house" ads
that aren't included in the rankings of big spenders. Also,
some of the larger Internet companies are doing more integrated
advertising, including print, radio and TV.
On the other hand, the Internet
hasn't matured enough to attract major dollars from brick-and-mortar
companies. In this environment, Weiner says, some of the more
aggressive efforts by small online companies "are standing
out more."
Astrocenter.com decided
the time was right to make a big push before the start of
the new year, when interest in astrology tends to be highest.
"We were in the market to make
a big deal and as luck would have it, the market was in our
favor," said Jeremiah Rosen, director of business development
for the San Francisco-based company, which launched in October
1999.
Going into the latest effort, Astrocenter.com
had about 600,000 subscribers getting its free e-mail horoscopes.
Now, its user base has more than tripled to 2 million, Rosen
says.
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