One of the great ironies of advertising on the Internet is that the very thing that was supposed to make it so great - accountability - has turned into a liability. The old aphorism is, "Half my advertising is wasted - I just don't know which half." The Web was supposed to be a place where advertisers knew exactly how their customers were responding.
Except that they're not responding. Click-through rates are minuscule (0.5 percent), and they are one of the few yardsticks out there. "I was expecting more-targeted, more-tangible and more-specific results," says Pizza Hut (dossier) Chief Marketing Officer Randy Gier. "So far I've been disappointed. If you know anyone who can turn all those Internet eyeballs into orders, let me know, because I haven't seen it yet."
The problem, it seems, is a failure to communicate. "We aren't doing a good job of selling ourselves," says Richy Glassberg, chairman and co-founder of Phase2Media (dossier), a New York-based Internet ad sales agency, and vice-chairman of IAB. "We're way ahead of where cable was at this point in terms of reach and use, but we are 10 years behind where cable was at this point in terms of agencies and clients understanding its value."
Believers point to a few online ad campaigns that have paid off. Last fall Volvo launched its new sedan, the S60, exclusively on the Web, chiefly on America Online. The Swedish automaker splashed banners throughout the site and offered AOL subscribers $2,100 worth of free options. Compared to a full-scale publicity blitz, the campaign was cheap. (Ron Berger, CEO of Messner Vetere Berger McNamee Schmetterer/Euro RSCG, which orchestrated the effort, won't disclose exactly how much it cost.) It was also effective. About half a million consumers received CD-ROMs touting the new car. Still, even that campaign was shaped by chance. "If we would have had a traditionally sized ad budget for that launch, we probably wouldn't have done that," Berger says. "But we ended up turning a weakness into a strength."
Other advertisers have broken new ground by playing to the Web's interactive strengths. Lee Jeans, for example, rolled out an online game that required consumers to visit retailers to get game codes.
But before these successes can continue, Internet ad-sales people have to start getting in the door again, squeezing past the unbelievers. One obstacle is that agencies tend to be balkanized: Media spending is in one department; Internet marketing is in a whole different office - or even agency. Internet advertising, the industry is now learning, is more easily sold as one element in a campaign. Starcom's Tobaccowala says a client's marketing campaign is like a pizza - and the Internet ad industry is the Tabasco. "The online ad salesmen kept screaming, 'Look how red our Tabasco looks and how hot it is!'" he says. "They should have been saying, 'Look at how much better we can make your pizza taste.'" Web advertising still holds promise. But for now, it's mainstream marketing as usual - without the hot sauce.
