This article is part of an ongoing series regarding Social Media, and its implications to advertising and marketing effots. This is Part 2, please read Part 1: What is Social Media if you missed it.
Advertising, in its myriad of forms, has always had a single objective: get your message in front of people who you want to influence. This has taken on many forms over the years: billboards, hand-bills, magazine and newspaper spots, or television and radio spots. All of these mediums of advertising have been effective and the introduction of new media (television supplanting radio) has caused a shake up in the old industry. The advent of the Internet and, more specifically, websites is no different.
The key to the type of advertising being discussed is that someone has created some content that people are finding interesting to them; this may take the form of newspaper articles people read, television programs people watch, or events people attend. In all cases, an audience has been created that is willing being communicated to and can be defined in demographic terms. In all these cases the producer of the content has the opportunity to bring his audience together with people offering services that may be of interest to them. This is often sold as Spot Advertisements. Spot advertisements have always needed to take on forms approriate to the medium: video on television, audio on radio, posters and banners at events, and print for newspaper and magazines.
The Internet has created several new medium for the transfer of information, the most commonly used to date being web pages. These have supplanted several forms of prior entertainment: print periodicals have moved to blogs, books have moved to webpages, video has moved to youtube, radio has moved to podcasts. What is important to note, is not how these items have moved, but that these new mediums are generating content that people find of interest, and in which advertisements can be placed.
There are several ways to approach these various media for advertising.
Affiliate Programs
If your product or service is sufficiently interesting to the public, and simple enough to sell, it is possible to offer an enticement to others to sell the product for you. This takes the form of a sales commission. This is a highly technical and expensive venture as it requires tracking all of the individuals selling the product or service, tracking their sales, paying them out, and maintaining confidence in your system. Having said all of this, this can be one of the most cost-effective mechanisms as you only pay out on a confirmed sale.
Probably the best example of an effective affiliate program is Amazon. Often when reading websites, you will see an Amazon link to a product being discussed. These links carry a special code in them that tells Amazon where you came from. If you purchase a product from Amazon, after following one of these links, often the owner of the website will get a small percentage of commission off your purchase. Amazon only pays out in the case of a sale, reducing their cost, and motivating an army of thousands of individuals to come up with unique and interesting ways of marketing Amazon’s products.
It is worth considering what a large technical system this is, and that there are large expenses in maintaining an affiliate program. These are fixed costs, meaning that the cost is easily spread across the volume of people in it, but that means volume is the key, and the program itself must be advertised.The entry costs are high, making this a non-viable option for most companies.
Direct Spots
Originally, internet websites used the same mechanism of selling advertisments as anyone else: you paid for a specific spot, of a specific size, on a specific page. This changed overtime to spots on webpages that had different advertisments each time the page loaded, but the fundamental was the same: you contacted the website owner directly and asked what it would cost to have your advertisment placed on their content.
This technique shifts the expenses to the publisher. They must maintain a list of all their advertisers, they must find advertisers willing to pay for advertising, and they must maintain their content in such a fashion so as to ensure a particular demographic that their advertisers are interested in.
This form of advertising does mean control for the advertiser, in that they can see the content that the advertisement is being placed on, but the added expense of maintenance to the publisher gets passed on to the advertiser in the form of higher fees. Further, there is difficulty finding these sites; of all the millions of websites, which ones are relevant to your advertising campaign, this is a hidden expense to the advertiser.
Several websites maintain this form of advertising
- Calgary Sun: maintained a staff dedicated to selling advertisements at the advent of the Internet, and has a regional demographic
- Survival Blog: a small, but dedicated user base that fits into a very niche demographic that ensures advertising, while expensive, is highly effective
- Facebook: has a very large user base, the personal information stored on a facebook page allows advertisers to track and target various demographics, its size allows it to keep cost down
Syndicated Services
There is a middle ground between Direct and Affiliate, the Syndicated Service. Several providers perceived a need to reduce the expense to both advertisers and publishers, while allowing advertisers a broad spread of relevant websites, and publishers the ability to focus on their content rather than their advertisers.
Advertisers register and pay the service to have their advertisment published on the internet to a target audience. Publishers register their site with the service to display ads relevant to their target audience. The Syndication Service plays middle man, determining which advertisements match with which content in the most effective manner. To keep things honest, this is often handled on a “Pay-Per-Click” (PPC) basis, meaning that the advertiser does not have to pay unless the advertisment is clicked on, and the publisher only receives revenue from their affiliate advertising link. Since the service deals in large volume, they are able to maintain a listing of revenue and expenses for both parties, for a very small overhead.
Syndication services offer the best generic advertising solution as they require less investment (both in time and money) while offer the broadest range of advertising opportunities.
Conclusion
All three of these forms can be effective, depending on your budget, time requirements, and advertising objectives. In the end the objective of advertising has not changed in a thousand years: get your message in front of your target demographic.
Think Outside the Flock,
The Plaid Sheep