Ads Impact

Measuring the Impact of Online Advertising

The actual impact of advertising is hard to track and quantify for both mass media and the Internet, although interactive technology presents new possibilities for the entire advertising industry. In the case of mass media, there are companies that measure the size of the audience per commercial message, for instance Nielson TV and radio ratings, and efforts are underway to further evaluate the economic impacts of advertising by correlating advertising and an increase in sales. But broadcast advertising is fundamentally inefficient because of its redundancy. It sends messages regardless of whether people are interested, receptive, or relevant to the product. In comparison, selecting an audience and verifying the number of people who received a message is relatively easy on the Internet. However, the advertiser still does not know whether the receiver actually read the message or not. Refined measures and methods are being proposed for the Internet. Proctor & Gamble, for example, limits payment for its ads on the
Yahoo! search engine to the number of people who actually request more information by clicking on their advertisement rather than paying based on the number of Yahoo! customers to whom its advertisement is presented on their search pages. This is in contrast with the traditional method of measuring viewer-ship, and payment—based on "eyeballs," equivalent to the number of connections to Yahoo!. As more and more sellers begin to doubt the effectiveness of broadcast advertising on the Internet that simply flashes banner advertisements, have to rely on different revenue sources. As a result, there will be reduced outlets for broadcast-based advertising in the future. An alternative is targeted advertising.