Analyzing a Marketing News Story - Essay Example

? Analysis of a Marketing News Story ID Number & Total Number of Words 000 The news report published by the Telegraph talks about Google’s decision to acquire the online marketing company that was established by the Wildfire (Sparkes, 2012). In exchange of $250 million, Google is expecting to improve its advertising business. Basically, what Wildfire does it to make the different social networking sites like Linkedin, Facebook, and Twitter including all other online marketing campaigns available in a single website. Although this particular news report talks about the business tactic of Google, it also brings up new idea with regards to the future developments in online marketing options. Advertisements are referring to a “paid-message in a form of media” with the purpose of attracting the attention of the target consumers (Faber, Lee and Nan, 2004). Aiming to reach for the target audience, the traditional advertisers utilizes newspapers, magazines, radio, television, mail, telephone, billboards, posters, fliers, CDs, and audiotapes as a communication channels (Kotler, 2000, p. 15). On the other hand, the use of on-line advertisements such as the use on-line banners (usually appears at the top end of a web page), e-mail, search engine advertisements such as Google.com or Yahoo.com, the interactive on-page media ads, streaming audio and video among others has been widely used to catch the attention of online viewers. In fact, the use of online advertisement tools is considered as on of the fastest growing medium for modern advertisements (Faber, 2002). According to Kotler (2003, p. 4), the main reason why large-scale companies are advertising their products is to “inform, persuade, remind, or reinforce” the public consumers’ purchasing behaviour. It means that with the use of effective advertising strategy, companies that are advertising their products and services can benefit from having a significant increase in their expected monthly or annual sales performance. Aside from the promise to increase the companies’ sales performance, effective advertising can also strengthen the company’s brand equity, improve the companies’ existing product packaging, and requires the use of a celebrity spokesperson among others (Kotler, 2003, p. 7, 12). Based on consumers’ response with regards to the use of online and traditional advertisements, Gallagher, Foster, and Parsons (2001) revealed that the use of a traditional print ads and advertiesements in Web format does not necessarily provide any significant difference with regards to the viewers’ ability to recall the advertised message. After exploring the impact of pop-up windows and animation on the memory of 60 online advertisement viewers, Diao and Sundar (2007) revealed that the viewers ability to recall the pop-up advertisements is higher as compared to the use of banner advertisements. Not all advertisements are effective in terms of sending the company’s message accross their target customers. For this reason, a lot of researchers have focused their studies on examining the effectiveness of online advertisements (Callaway, 2010; Chtourou and Abida, 2010; Shukla, Sharma and Swami, 2010; Diao and Sundar, 2007). After conducting a researh study with regards to the effectiveness of online advertisements, Shukla, Sharma and Swami (2010) explained that the ability of the online advertisers to make the online viewers satisfied with what they see and read about the advertised products and services increases the public viewers’ intention to make online purchases. Therefore, online advertising companies are looking for new ways to improve their existing online advertising services through product and technology innovation. Recently, Sparkes (2012) mentioned that roughly 16,000 businesses are already using the social media as part of their marketing campaign. In line with this, Chtourou and Abida (2010) revealed that the continuously increasing number of existing advertisements tend to create an avoidance behaviour on the part of the online viewers. Based on the research study that was conducted by Walsh (2010), people with high levels of internal locus of control are the ones who are more likely to have more power to avoid viewing online advertisements and that online advertisements are easily avoided as compared to advertisements that are transmitted through the use of traditional marketing tools (i.e. television, newspaper and magazines, or radio, etc.). Kotler (2003, p. 6) mentioned that the available advertising budget is one of the biggest factor that can affect the companies’ choices of advertising medium. Since online advertiements require the least advertising cost, a lot of companies are taking advantage of the available social networking sites as part of their online marketing campaigns. Specifically the gradual shift from the use of traditional advertising medium to on-line advertisement tools has resulted to a signficant change in the way large-scale companies are using mass advertisement into a more personal advertisement. Since the use of Internet advertisements provides a two-way communication between the advertisers and the viewers, marketing personnel should see to it that they take advantage of the interpersonal communication offered by online advertiements (McMillan and Hwang, 2002). Based on the basic law of supply and demand, it is possible that the gradual shift from the use of television advertisements to the use of online advertisement is triggered by the high cost of television advertisements. Eventually, when the television ads becomes less saturated, the cost of TV advertisement would eventually decrease in order to create more demand. The case of the online advertisement is totally different from the long-list of traditional advetising mediums. For instance, the available resources needed in creating an online advertisement is unlimited because anyone with an IT knowledge can develop their own website or upload their online advertisements in a free online advertising website. Therefore, even if the demand for online advertisement increases, the market price for online advertisements will remain lower as compared to the use of television as an advertising medium. Using either business-to-consumer (B2C) or business-to-business (B2B) approach, the significant increase in the number of Internet users has encouraged a lot of marketers to extend their product and services advertisement online. In response to the growing demand for online advertisement, Google decided to acquire Wildfire for the sum of $250 million (Sparkes, 2012). By continuously improving Google’s online advertising platform, this company will be able to establish a more reliable medium for online advertisers. References Callaway, S. (2010). Internet marketing strategies for music companies: understanding the demographics of an emerging customer segment. International Journal of Internet Marketing and Advertising, 6(2), pp. 199-221. Chtourou, M. and Abida, F. (2010). What makes one animation more effective than another? An exploratory study of the characteristics and effects of animation in internet advertising. International Journal of Marketing and Advertising, 6(2), pp. 107-126. Diao, F. and Sundar, S. (2007). Orienting Response and Memory for Web Advertisements: Exploring Effects of Pop-Up Window and Animation. Communication Research, 31(5), pp. 537-567 . Faber, R. (2002). From the Editor: A Glance Backward and the View Ahead. Journal of Advertising, 31(4), pp. 1-3. Faber, R., Lee, M. and Nan, X. (2004). Advertising and the Consumer Information Environment Online. American Behavioral Scientist, 48(4), pp. 447-466. Gallagher, K., Foster, D. and Parsons, J. (2001). The Medium is not the Message: Advertising Effectiveness and Content Evaluation in Print and on the Web. Journal of Advertising Research, 41(4), pp. 57-70. Kotler, P. (2003). Marketing Insights from A to Z: 80 Concepts Every Manager Needs to Know. New Jersey: John Wiley & Sons, Inc. Kotler, P. (2000). Marketing Management - International Edition - The Millennium Edition. New Jersey: Prentice Hall International Inc. McMillan, S. and Hwang, J.-S. (2002). Measures of Perceived Interactivity: An Exploration of the Role of Direction of Communication, User Control, and Time in Shaping Perceptions of Interactivity. Journal of Advertising, 31(3), pp. 29-42. Shukla, A., Sharma, N. and Swami, S. (2010). Website characteristics, user characteristics and purchase intention: mediating role of website satisfaction. International Journal of Marketing and Advertising, 6(2), pp. 142-167. Sparkes, M. (2012, July 31). The Telegraph. Retrieved November 2, 2012, from Google buys online marketing start-up Wildfire. Google has bought online marketing service Wildfire for $250m (?159m) in a bid to expand its lucrative advertising business. [Online] Available at: http://www.telegraph.co.uk/technology/9442753/Google-buys-online-marketing-start-up-Wildfire.html [Accessed 1 November 2012]. Walsh, M. (2010). New insights into what drives internet advertising avoidance behaviour: the role of locus of control. International Journal of Internet Marketing and Advertising, 6(2), pp. 127-141. Read More