Is The Rise Of Online Sales Due To Contextual Advertising?
Is The Rise Of Online Sales Due To Contextual
Advertising?
Many people are wondering what has caused online
sales to increase. Many would guess that it has something to do
with advertising. These people would be considered to be only partially
right, because online sales have increased due to online advertising.
More specifically, increases in online sales
are directly related to contextual advertising. Contextual advertising
is deemed effective because the ads are delivered based on the content
of the website using an automated system (PowerHomeBiz News, Nach
Maravilla, July 2004). For example, a page on hockey will display
ads on hockey teams; or a page on business will show ads supporting
various business ideas.
In today’s market, contextual advertising has become an
essential device to effectively attract customers online. Contextual
advertising is extremely different from those of the past, it supplies
online marketers with a truly efficient, metric driven, return on
investment (Webpronews.com, Anand Subramanian, August 2005).
The final outcome for advertisers and publishers is a higher click
through rate that generates an increase in sales and profit. With
the emergence of Google's AdWords and Clicksor, the business of
contextual pay-per-click banners has exploded. (Cyberindian.com,
Mike Banks Valentine, January 2006) This media offers the breathtaking
combination of easy use and payouts for each and every click. It's
no wonder this media is so popular with the likes of Slashdot, which
shows PPC marketplace links on the right-hand side of the site's
main categories and posts, and Go.com, which uses Yahoo Search Sponsored
Results to power its search function (Cyberindian.com, Mike Banks
Valentine, January 2006). Businesses that don’t grasp the
benefits connected to this type of marketing and don’t incorporate
it into their advertising and customer acquisition strategies will
be left in the competitions dust (Webpronews.com, Anand Subramanian,
August 2005).
Internet spending hit $143.2 billion for 2005 which was a 22%
increase over 2004 spending of $117.2 billion (ClickZstats, Enid
Burns, January 2006). Of the total online spending, $82.3 billion
was spent on non-travel retail and $60.9 billion was spent on travel.
(ClickZstats, Enid Burns, January 2006).
Among individual e-commerce sites that utilize contextual advertising
techniques, eBags.com, an online retailer of bags and shoes, reported
record holiday sales, with an increase of 42 percent over the 2004
season (CnetNews.com, Elinor Mills, December 2005). In addition,
in the week ended Dec. 11, 2005 online sales passed the $3 billion
mark for the first time (MarketingVOX News, January 2006). In the
week ended Dec.18, online sales have increased 29 percent to 3.03
billion from $2.35 billion in 2004. (MarketingVOX News, January
2006).
During this holiday season, contextual ad user Amazon.com reached
its best holiday sales season ever. Amazon sold more than 108 million
items from Nov.1 through Dec.21. Amazon amazing sales was mainly
due to Apple Computer's iPod music player; which occupied the top
three online sales spots in electronics--the 2GB Nano, in black;
the 30GB video iPod, also in black; and the 512MB Shuffle (CnetNews.com,
Elinor Mills, December 2005).
Potentially, contextual ads are as large as the web itself. Google,
Clicksor, and Yahoo are all going to be networks that advertisers
and publishers will be hunting for, in order to boost up their online
sales and profits.
Contextual advertising can be said to be the number one source
that has caused online sales to boom. The reason contextual advertising
has increased online sales dramatically, is because people viewing
your website already pre-qualified themselves as someone interested
in what you offer. You receive a higher quality, targeted visitor
to your site. That translates into a higher conversion rate and
an increase in profits for advertisers and publishers. (WorkZ News,
Tina Valiedi, July 2005)
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Source:
(ClickZstats, Enid Burns, January 2006) URL: http://www.clickz.com/stats/sectors/retailing/article.php/3575456
(CnetNews.com, Elinor Mills, December 2005) URL:http://news.com.com/Online+retailers+report+record+holiday+sales/2100-1038_3-6010133.html
(Cyberindian.com, Mike Banks Valentine, January 2006) URL:http://www.cyberindian.com/web-marketing/how-to-qualify-for-google
adsense.php
(MarketWatch News, Bambi Francisco, January 2006) URL:http://www.marketwatch.com/news/story.asp?page=1&guid=
{7AE0925D-3006-4152-AD6B-4F43A5AFD1A3}&siteid=mktw
(MarketingVOX News, January 2006)
URL: http://www.marketingvox.com/archives/2006/01/05/online sales_surpass_3_billionmark_for_week/index.php)
(PowerHomeBiz News, Nach Maravilla, January 2006) URL: http://www.powerhomebiz.com/vol139/contextual.htm
(WorkZ News, Tina Valiedi, July 2005)
URL: http://www.workz.com/content/view_content.html?section id=517&content_id=6868
(Webpronews, Anand Subramanian, August 2005)
URL:http://www.webpronews.com/enterprise/marketing/wpn-16-20050819Ad
About the Author Yesup Ecommerce Solutions
Inc.
330 Highway 7, East, Suite 202
Richmond Hill, Ontario, L4B 3P8
E-Mail: info@yesup.com
URL: www.yesup.net
905-763-9735
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