Once upon a time, electronic catalogers thought the best way to attract Web customers was to advertise online-mainly through banner ads and key words on search engines. But more catalogers, both print and virtual-only, are finding they also need offline, or conventional, advertising to drive traffic to a Website.
Many catalogers, such as Emeryville, CA-based personal products mailer SelfCare, advertise their URLs in their print books in addition. SelfCare splashes its URL, www.selfcare.com, on the cover and next to every page number. It also advertises in its catalog special hosted ‘Net events, such as online chats. Using a print catalog to promote a Website and value-added features is “an incrementally inexpensive way to get the word out,” says director of business development Ken Stockman. As a result, he says, SelfCare’s three-month-old Website accounts for more than 2% of total business, and the average online order is higher than the average print order.
U.S. Cavalry, a Radcliff, KY-based military-related products marketer, also advertises its URL throughout its print catalog and on all promotional materials, such as brochures and statement stuffers. “When the URL is printed on other promotional pieces, we definitely see an increase in online traffic,” says director of marketing Sam Young. The company also sends a free URL-logo baseball cap with online orders of more than $125 as additional advertising.
Mainstream media Within the past year, Web catalogers have also stepped up advertising through other traditional media, including space ads, radio spots, and television. SelfCare will test regional radio advertising along with traditional space ads next month; U.S. Cavalry places ads in newspapers and in targeted magazines such as Outdoor Life.
Even virtual-only catalogers have increased their offline advertising to drive traffic. Online computer cataloger Cyberian Outpost launched a multimillion-dollar television ad campaign and began placing newspaper print ads in November. “Consumers are more likely to buy online when they see your name elsewhere,” says president/CEO Darryl Peck.
Although online wine marketer Virtual Vineyards spends 90% of its $1 million annual advertising budget on online advertising, it wants to broaden offline advertising. In mid-November, the company began running radio spots mainly in the San Francisco area in partnership with Wine Enthusiast magazine. This year, Virtual Vineyards will increase its radio advertising, and begin newspaper and magazine print ads. “We can build our brand better through offline advertising,” says director of marketing Cyndy Ainsworth. “It gives us a better opportunity to tell our story by getting customers familiar with the company before they go online.”
Online ads-overrated? Of course, online banner advertising seems the perfect way to reach customers already online-and it’s easily trackable, unlike offline advertising. But many catalogers say the diminishing clickthrough rates of customers who actually respond to the ads does not produce enough traffic to justify the expense.
For example, a small black-and-white ad in a national monthly magazine averages about $1,000, according to U.S. Cavalry’s Young, while the cost for a banner ad to appear in a keyword search averages $6,000 per month. “Nearly 65% of my ad budget is spent on online advertising just because it’s more expensive,” he says. “And I’m concerned that the banner ads are not reaching the right people.”
“The average clickthrough rate for banner ads was 2% last year,” says Ken Wruk, president of Webpromote, a Chicago-based Internet marketing services company. “This year, the average response rate on a banner ad has declined to less than 1%, and it continues to drop,” mostly because banner ads are not interesting enough to tempt viewers into leaving the linking site for the advertising site.
The customer acquisition costs through banner ads are almost triple those of other media, according to Virtual Vineyards’ Ainsworth. “And visitors from banner ads have lower conversion rates,” she says, though she declines to give numbers.
There is some good news, however. The average banner ad price has fallen from $37.84 per thousand in May to $36.29 in September, according to advertising market research search firm AdKnowledge.