Vol 8 #7

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In This Issue

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My 2¢ Worth


'm always impressed by modern technology when I think about how far we've come. Many of the things we take for granted today were the stuff of science fiction not too many years ago.

he funny thing is, mankind has made greater leaps in technology in the last 200 years, than in all the centuries before that.

he first automobile was invented in 1769 and it little resembled the autos of today. It wasn't even powered by gasoline! The very first self-powered road vehicles were powered by steam engines.

efore that time, mankind were little more than primitive savages.

ave you ever heard the phrase that, "Technology sufficiently advanced is indistinguishable from magic?" If we could bring back a person from, say the Stone Age, I'm sure they would agree that our technology is magic.

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Feature Article

Are Banner Ads Still an Effective Form of Internet Advertising?


by: Justin Michie

Banner ads are the pioneers of internet marketing. The first banner ad appeared on www.hotwired.com (now www.wired.com) back in October 27th, 1994 in the form of an ad for AT&T. Since that time banner ads have taken over the internet in a variety of forms.

A banner ad is a graphical promotion used on websites as a form of advertisement. Banner ads can come in any size you want, however the accepted standard is 468 pixels wide by 60 pixels high. Due to the widespread acceptance of this size, the same banner ad can be used on most websites without having to reconfigure the size and layout. Although banner ads can be used to advertise your phone number, address, or anything else you like, the real purpose behind banner ads is to get someone to click on it and jump to your website.

There is a great deal of controversy about the effectiveness of banners. Some people swear by them, others swear at them, saying they don’t work worth a darn. Although click-through rates have gone consistently downward, the same can be said of banner ad prices. The average click-through rate hovers somewhere around 0.5% range for banner ads. But, with a good banner design and placement it is still possible to achieve a good return on investment, by combining below-average ad rates and above-average response rates.

Banner ads are sold in any one of three ways: cost per 1,000 impressions (CPM), pay per click (PPC), or pay per action (PPA).

Buying a PPC banner is usually more expensive than the CPM basis, but can be much more effective because people actually take some kind of action by clicking though to your site. One of the drawbacks to PPC banner advertising is that one person may click on an ad more than once and you get charged for each click. However some ad providers track IP address, and only charge one click per computer per day. Most places though don’t do this for the simple reason that it means less money in their pocket.

The effectiveness of cost per impression banners can vary quite a bit, depending upon their placement on the webpage and you typically (not always) pay the same whether the banner is displayed prominently at the top of the page, or hidden in a bottom corner. Most CPM banner sites rotate the banners throughout the site (Run of Site - ROS) and throughout the page. Banner ads to reach general audiences are typically priced at $1 to $10 CPM, while targeted sites may get CPM rates of $30 - $50 or more. Even though it may not seem like much, banner ads can be quite expensive. Do the math with me:

If you're paying $10 CPM and the click-through rate is an industry average of 0.5%, then it costs you $10 to get 5 people to your site, or $2 per person. If 2% of the visitors to your site make a purchase, then your customer acquisition cost (CAC) is $100, ($2 / 2%). That means for every transaction you do you need to pay out $100 in advertising fees. Some websites don’t even manage to convert 2% of visitors into customers, especially when they originate from a banner ad.

In order for banner ads to be effective, you need to combine above average click-through rates, with below average banner prices and sell either a high-ticket product, a product with a high markup (like an info product) or have a strong back-end in place so you make money on the second, third, fourth and even twentieth sale.

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Article continues.

Pay per action banners are usually the most expensive, since you pay only for a desired action. This can be a product sale, having someone sign up for an email list or any other action you want. PPA banners can be very similar to an affiliate program and use the same type of tracking.

Banner Exchanges

Just like link swapping, some companies have banner swapping programs. Most banner swapping programs are free and some might require you to pay a monthly administration fee so they can cover their costs.

Many of the free companies make money by the in-proportionate ratio of banners you display on your site, vs. your banners being displayed on other sites. Let’s say you need to place a certain banner on your site for a total 10,000 impressions, but you only get 8,000 impressions of your banner on someone else’s site in return. This is how these sites fund themselves. They sell the extra 2,000 impressions you lose, for a profit.

Some banner exchanges are pure and simple; I’ll put your banner on my site, if you put mine on yours. There’s absolutely nothing wrong with this if both sites are of a similar interest and get comparatively the same amount of traffic.

Some sites will track your stats and some will allow you to upload multiple banners so they can be rotated throughout the sites where are placed. This way you can determine what works best if you’re paying per impression. It’s also always a good idea to use your own ad tracker so you can follow the click-throughs to your site and see how many actually lead to a sale.

Some banner exchange companies will actually design the banner for you as part of their program. Although I suggest you design, (or have designed) your own banners. If you are going to let the banner exchange company design it for you, make sure it is on target. Some of these companies use software that automatically creates your banner untouched by human hands and unseen by human eyes, until it gets to yours. As with any type of advertising, the design, wording and call to action of your banner is quite important.

Since the purpose of a banner is to stop, interrupt really, the surfer’s train of thought, clicking on a banner is an impulse decision. People need a reason to make an impulse decision so you need to give them one. The following are some tips to help generate the highest click-through rate possible:

  • Have a call to action. Always say "click here" on your banner, or some variation thereof. I know this sounds overly simple, but it is often overlooked and can easily double your click-through rates.
  • Add a button. Placing the words "click here" into an actual or obvious button on your banner improves response.
  • There's no room for subtlety in banners. Your banner should scream your message.
  • Try posing questions: "Want to save 15% on your car insurance in 15 minutes?" Questions work better than statements, particularly when they're used to tease your audience. Studies have shown that by changing a statement to a question you can raise your click-through rate by 16%.
  • If appropriate use humor. Make sure it’s actually funny and get some others opinions first. Quite often something that might be funny to you, other people may not get.
  • Use bright primary colors. Brighter colors attract visitor’s eyes. Blue, green, and yellow elicit the most click-throughs. Stay away from transparent colors either in the foreground or background - they tend to get lost among the colors of most websites so stick with solids.
  • Use simple animation. Moving images and blinking animation attract visitors to your banner. Strategic use of movement grabs attention more effectively than static banners. Don’t make them too wild or complicated so the message gets lost, the senses are overloaded and/or the file size is too large.
  • Offer a reward or free gift when someone clicks on your banner. It will help motivate people to click. Contests also work well, especially if you’re giving away money. Money is the biggest motivator.
  • Run a series of banners. It may take more than one message to tell your story or to go after a particular market. Run a series of banners and vary your message. Keep you message consistent and catchy to make your visitors want to read further. After the fourth impression of the same banner, most people tend to subconsciously block it out in their mind.
  • Keep the copy short. Think billboard advertising - the average person spends six seconds looking at a billboard and you have less than a third of that time on the web. Write compelling copy. Use action words that motivate.
  • Use italics if you can. Although they don’t have a huge impact, they can increase click-through rates by a few percentage points when compared with standard typefaces.
  • Create curiosity. A large number of those who click on ads do so because they are curious. Studies show that curious clickers very widely by demographic and other characteristics, so targeting based on curiosity can be very effective when you have a general interest product or service.
  • Use wide banners or tall skyscraper banners. They’re clicked on significantly more than smaller, skinnier, or square banners.
  • Make your banner file size is small, so it loads quickly; 10-30kb is typical for a 468 by 60 pixel banner.

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Some Tips on Implementing Banner Ad Campaigns

First, determine if you think it would be worth it to participate in a banner ad campaign. Consider the banner costs, compared to an average click-through rate of half a percent, your sites’ conversion rate, profit margins and customer’s LOV (lifetime of value).

Determine where and on what sites you want to consider placing your banner ads, taking into consideration the cost, banner placement, payment types (PPC, CPM, PPA) and if it’s a targeted site or not. Find some websites that complement yours.

Contact the site on which you wish to place your ad and ask if they have a rate card and get info on their payment options. You can also see if they offer any specials or discounts if you purchase in bulk, or even simply ask for a better deal. A lot of the time they will give you one simply because you asked.

Read the submission guidelines. This usually covers things like:

  • Maximum file size
  • File types accepted (commonly .gif, .jpg and flash - .swf)
  • Accepted banner sizes
  • Deadlines for submission and review
  • How many banners can you submit for rotating campaigns? How often do they rotate the banners?
  • How do they determine where your banner is placed on each page?
  • Do you pay for placement or is it random?

Keep track of all your banner statistics. Even though the company you are advertising with may do this for you, it’s also a good idea to track it yourself. This way you can track and determine results like your conversion rate, ROI, CPC (cost per click) and click-through rate for each banner.

All in all, banner advertising can be a key part of your online marketing campaign. Depending on all of the key factors mentioned above, it may or may not be a financially feasible part of your marketing campaign, if it can make you a profit. If it can’t, don’t sweat it, there’s tons of other ways to cost effectively market your business online.

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Justin Michie is a well respected Internet Marketer and author of the most up to date and comprehensive Internet Marketing Book available: Street Smart Internet Marketing. For more information on Online Advertising, check out his brand new Internet Marketing Book at InternetMarketingBook.com -- it’s the best investment under $20 you could ever make for your online business. Order now and for a limited time only receive hundreds in free bonuses!

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This weeks Tip

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Second Article

Niche Marketing and Keyword Selection: It's Search Marketing Heaven


by: Karri Flatla
snap! virtual associates inc.

The beauty of e-commerce is that you don’t have to pound the pavement in search of buyers—they are already pounding the cyber sidewalk looking for sellers. However, you must still help your market find you amongst the billions of web pages competing for its attention. Strategically selected keywords can be your best friends in attracting niche traffic that is willing to spend.

If you are an Internet entrepreneur, a reliable strategy for building profits is to define the narrowest niche possible without squeezing your target market size out of substantiation. There are millions of people surfing the web with a few bucks to spend on a good fix, and if you can articulate the right fix to the right prospect, you’re in business. Anyone who says that niching will exclude too many potential buyers doesn’t know why he is in business in the first place. Moreover, a prospect pool with no common reason to buy from you is a headache that will cost time, money, and more patience than your sanity can afford. Get over your desire to be popular with the whole wide world and instead choose a niche.

Now that we’ve got your ego out of the way, let’s talk about what it takes to implement a keyword strategy that attracts highly targeted, qualified leads to your website.

If you know not only who your customer is (demographics) but how he thinks and feels (values, needs, and desires), you can select keywords that will lead prospects straight to your front door with cash in hand. Start by brainstorming a keyword “seed list.” (If your SEO consultant doesn’t ask for this, take your money and run.) Resist the urge to think in terms of product or service naming conventions, although you may end up using some. People in your target audience may not be aware of such terms, but especially if you provide a niche product or service that has not yet been commoditized in the marketplace. Instead, think in terms of “answers”—answers to your audience’s most burning questions. Answers are what your best (read: loyal) customers will pay for. And if the answers (read: solutions) you provide are not easily duplicated elsewhere, they will pay handsomely.

As you brainstorm the seed list, be sure to cover a range of investigative thought processes. For example, if I am an online shopper looking for a way to protect my old hardwood floors, I am going to search on terms like “antique hardwood floor cleaners,” not “Joe’s Super Sonic Latex Shield for Veneer.” This is an admittedly silly example, but it illustrates the ridiculousness of trying to attract quality traffic by grandstanding, beating your chest, and yakking on in a language that only you, the seller, can understand.

Once you have established a seed list of about thirty to fifty terms, your SEO consultant can then begin the research process, usually with the help of a keyword tool such as Wordtracker (www.wordtracker.com). Here we find out what people are actually searching on. This is the exciting part (okay, maybe “exciting” is a stretch). Numerous phrases you had not thought of will reveal themselves—an excellent opportunity to brainstorm new content for your site.

During this research stage the important thing to focus on is specificity, perhaps the most overlooked tactic for attracting web traffic that will convert into sales or inquiries. This is as opposed to choosing sweeping or irrelevant descriptors that say nothing about your site’s offerings, product benefits, or how those things relate to the desires of your target market. In short, optimizing for non-descript or one-word terms being searched on by non-descript, aimless surfers is the equivalent of jumping into an SEO abyss. And if a fly-by-night SEO has promised you the ever-elusive top ten ranking, your site is about to be optimized for keywords that no one within a thousand miles of your target market has ever searched on let alone heard of.

Once your keyword list has been finalized, your SEO consultant will map two to three key phrases to each page of your website. At this point, the work of page optimization begins, a process that involves HTML editing, copy editing, page rewrites, and sometimes a total content overhaul. The resulting page copy should flow well and not actually “look” like it has been optimized. If it sounds stiff or silly on account of lame keyword integration, get another SEO. Search engines don’t appreciate this kind of content any more than your visitors will.

A true niche marketing strategy for keyword selection is unapologetic. It zeroes in on the desires of your target audience and doesn’t flinch because of the traffic it leaves behind. If you have a good copywriter on board, keyword niching also creates a website that conveys visitor relevance and stimulates a desire to act. Remember, the goal of Internet marketing is not to generate boatloads of traffic but to increase conversions. Niche boldly, know your audience intimately, and give visitors the specific keyword-rich content they are looking for. Anything more is superfluous and will dilute campaign impact. If you stick to your guns as a niche marketer, you’ll be famous with the people that matter and generate the “specific” ROI you have been aiming for.

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Karri Flatla is a business graduate of the University of Lethbridge and principal of snap! virtual assistance inc., a small business consulting firm providing on-line marketing services to the progressive entrepreneur. Karri also produces Outsmart, a small business newsletter full of practical tips and fresh insights.

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