Rules of the Road for Online Advertising @ ClickZ - Nov 97

The text book publisher J. Wiley calls this article a “must read”. Unfortunately, you must read it here since this article is no longer available on Clickz.

Warning: Immediate gratification ahead

By Marcia Kadanoff

Drive results with caution

OK, I’ve been here 4 months now. It’s official. I’m no longer an agency principal, responsible for the direct & interactive marketing needs of big corporate clients. No, I’m back in Corporateland myself, this time as VP of Marketing. Thankfully, the company is a hip, San Francisco start up. To be specific, Flycast, the only company that allows you to buy and sell Web advertising space in real time. I stumbled upon Flycast back in April of 1997. At the time the company shared with me its vision for instant gratification. Place your banner ads on the Web right from your desktop. Watch click-throughs happen in real time. Make changes to your campaign on the fly. Drive the results you need when you need them. Avoid the “wait state” that comes from calling or e-mailing half a dozen reps and waiting for them to get back to you. Immediate gratification allows you to drive the net results you need when you need them. But before you drive, know the rules of the road. Here is what is in my driver’s education manual when it comes to driving results on the web:

Explore roads not traveledThere seems to be some sort of herding effect at work on the web, with ad managers all flocking to the same handful of site that “everyone” seems to have on their “must buy” list. Flycast’s customers and their agencies (direct, interactive or general) know that the “must buy” sites often are priced out of reach when it comes to cost-effective new customer acquisition. If the net result you need is new customers at a cost you can live with, you’ll want to search out the smaller, more targeted sites that are priced to move. People who use the web to buy products tend to browse deep within the given category, visiting as many as 10 sites to search out the products and info they need. So, if you want to reach sports fanatics, think about buying space on sites like Fan Center ( and 2play sports ( These kinds of sites are hidden gems in our network: they reach the same demographic as ESPN and SportsZone combined but at a greatly reduced price.

Always test drive your vehicle before a long tripThe web allows you to buy media in increments as small as $5. So when in doubt, test. Set aside 10% of your budget for testing purposes. Many Flycast buyers are taking a web-first approach to testing. When in doubt, they test concepts first on the web to determine not only which campaign is best for the web, but also which concepts will work best in other advertising mediums.

Know the rules of the roadThe great thing about testing on the web is that it allows you to test a lot of options really fast, so you can figure out just what banner, offer, or media placement will work best for specific types of customers you are interested in acquiring. If you are unfamiliar with how to set up a test matrix, we can help. We’ve reduced all the statistics you need to know to some simple rules of thumb. Like the fact that each cell in your test matrix needs to deliver 250 actions to achieve statistical significance. Planning on a 2% click through rate followed by a 10% download rate? Then the action rate you can expect is .2% (2% x 10%). You’ll need to field a test with at least 125,000 impressions in each cell (250/.002). Want to test three banners X three sites? Plan on purchasing 1,125,000 impressions to populate your test matrix.

Resist white-line feverThe marketing director over at CarSmart ( may have gotten a great response by purchasing car-specific editorial on sites like ( This same tactic may fail miserably for you if you are Good Company ( Why? The need to buy a new car is generally triggered by some event. For example, your car just hit 100,000 miles, your lease is about to expire, or that new job you just landed can’t be reached by public transit. In contrast, wanting to hook up with other like-minded people is a state of mind not triggered by any particular need. To reach people in this state of mind, a match-making service like Good Company knows that its best bet is to place its ads very broadly across a broad range of sites, precision timed to reach specific day parts, say evenings and weekends. Targeting by day-part will outperform any form of editorial content.

Don’t get overally distracted by the scenaryIt’s natural to want to be the first on your block to use a particular creative or promo technique. Sure, novelty will drive your click through rate through the roof. For example, Java banners can get responses 10X those of a normal banner. But, most of these responses are webheads interested in the next best thing, not qualified leads for your product or service. If that’s your goal, you are better off relying upon tried-and-true advertising vehicles.

It’s better to be quick than to be deadMany of the sites we call “the usual suspects” like to sell their inventory in advance. Buying in the “up front” market is not for the weak of heart. Nothing beats the burning rage that occurs when the site you want informs you that placement in the exact section of interest to you has been sold out since last July? What the usual suspects won’t tell you is that the inventory situation is much different elsewhere on the Web. In general, as much as 70% of Web advertising impressions go unsold in today’s market. So if you are willing tonay, have to buy at the last minute, you can enjoy significant savings. Forget about buying up front. Instead buy in real time. You can get the same high quality impressions you would have bought at a fraction of the cost. Runner’s World ( is a site on the Flycast Network that represents a great buy. Normally available for a CPM of $25 in the up front market, you can start bidding on impressions at a CPM as low as $15 in the real time market.

Don’t fall asleep at the wheelThink you’re satisfied with your current Web advertising plan? Think again. To build a franchise at the speed of the web, you need to get out there and test, test, test ’til your daddy takes the T-bird away.

Originally published in ClickZ, 11.97

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