There's still only one important factor determining the fate of online publishing's success or demise: advertising. Since digitization dictates how publishers maintain online ventures, solutions designed to perpetuate Web marketing are maturing at leaps and bounds. The concept behind many e-marketing tools is to find a way to generate revenue without directing users away from a publisher's domain. And while the task may seem obtuse, two Web-marketing tool providers, ePod and Nexchange, promise publishers that where there's digital advertising, there's success.
The pitch of most Web marketers suggests ads on publishers' sites should offer transactional appeal for both content providers and advertisers. Assuring that publishers will acquire new users, without severing ties through sometimes-distracting advertising banners, not only bolsters audience participation, but also assures advertisers that the more users are logging onto a site, the more users will be potential buyers in the first place. But users clicking on banner ads will actually click out of the intended site, offering little hope of returning from the e-publishers' perspective. At the same time, for e-publishers to maintain that Web publishing is, in fact, profitable, advertising is a necessary evil. With this Catch-22 in tow, online publishers are more likely to invest in online media that not only harnesses ad money, but also nurtures regular users. Forrester research estimates that 26 percent of $5.6 billion in U.S. online ad spending represents a new performance-based buying. Forrester also predicts that at least 50 percent of the $17.2 billion projected for spending in 2003 will be the result of better branding on behalf of both digital publishers and advertising sponsors.
Revenue models may vary, but ePod is one marketing showcase designed for publishers interested in interactive advertising. The technology provider offers a platform for the convergence of advertising and Web content, enabling advertisers to distribute branded messages on targeted sites. For instance, using the ePod solution, a user logged onto a publishing domain may click on an advertising portal to browse products, enter an e-mail for more information and even fill a "shopping cart" inside the ad without actually leaving the publisher's site. ePod reports that this approach delivers an average of 25 times the conversion rate of user into buyer, which is music to both publisher's and advertiser's ears. Two of ePod's customers now include Entertainment Weekly and Hoovers.com. Hoovers reports that it's almost doubled the fee for advertising online , increasing from $45 per thousandth banner ad to $70 per thousandth ePod. Strategic partnerships with DoubleClick and MacroMedia have also seduced new ePod customers, including CDNOW, as well as expanded operations from New York City to San Francisco and Toronto.
Nexchange similarly swallows the issue of audience sustenance. For its customized service, Nexchange receives 20 percent commission. Much like ePod, the company partners with both advertisers and e-publishers to structure marketing to enhance buying and content goals. Its publishing clients are often concerned with the aesthetics of sponsors' digital ads, whereas sponsors are interested in getting more bang for their bucks. Since Nexchange's Web marketing tools allow for greater flexibility in keeping users, while supplying them with sponsors' products, the company has become a kind of technology moderator, not only overseeing digital file exchange between interested parties, but doing so with standards specific to each case.
Of course, the bigger question is whether any of these new marketing strategies will actually encourage greater selling for advertisers while building momentum for non-traditional publishing and e-commerce portals. According to Nexchange reports, customized services accounted for more than 25 percent of online traffic, wherein five to eight percent of those users purchased products based on the customized marketing blitz. And while the number may seem feeble compared to overall buying habits throughout the U.S., online buying is generally a lesser market. Nexchange's statistics are actually twice the industry average for online buying in total.
Will the latest tools inspire more faith in Web buying? Greater profit for e-publishers? And satisfaction among advertisers? It's too soon to tell, but the future of online advertising depends on it.
-Natalie Hope McDonald