CBS, Conde Nast Find Online Banner Ads Worth Only 16% Of A TV Spot
- by Joe Mandese @mp_joemandese, April 2, 2009
The study, which utilized McPheters & Co.'s proprietary methods, utilized sophisticated "eye-tracking" software to determine whether Internet ads were actually seen by respondents, who participated in the studies at CBS' Television City research facilities at the MGM Grand in Las Vegas.
Eighty-five percent of Internet ads served during the test appeared on-screen and could be identified by brand, but Internet video ads appeared much less frequently than banner ads, and their exposure skewed heavily towards young men. When they did appear they were twice as likely to be seen as banner ads.
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Among Web users, nearly two-thirds (63%) of banner ads were not seen. Respondents' eyes "passed over" 37% of the Internet ads and "stopped" on slightly less than a third, McPheters & Co. found.
In contrast to online ads, TV and magazine ads generated a strong propensity to be seen and recalled. Full-page, four-color magazine ads were determined to have 83% of the value of a 30-second television commercial, while a typical Internet banner ad has 16% of the value.
I am curious as the cost per ad on TV and magazines compared to the price they paid per Internet ad. It has been my experience that Internet ads do cost less per thousand people reached. Did the study invest the same amount of money among all three mediums to give them an accurate comparison?
Hello Anthony. I think you will find that the "low cost" Internet banner ads are on a CPM model and not a CPC model. Here in Australia online CPMs would hover around $7 while TV CPMs would range from $20-$60 depending on the demographic.
One thing we do know is that of the TV audience we get around 5%-8% "leakage" of audience every ad break. The remainder are either leaving the room or switching the channel. They may say they don't notice the ads or like the ads - but the eye tracking shows they see them! This compares to the 63% "leakage" on line. This difference is hardly surprising given that a TV ad takes up 100% of the screen while an online banner doesn't. Average click-through rates are around 0.3% - yes around 3 in every thousand actually click on banner ads.
Zachary, you raise a very good question. We have done some similar tracking here in Australia. While we found that the eye-gaze didn't vary dramatically between the (small) group of programmes tested there was a difference. Sport shows tended to fare better than dramas - mainly because downunder the breaks in live sport tend to be shorter (we actually have a 30-second break after every goal in our Australian Rules Football so they can show an ad - the umpire waits for the flashing light to indicate that the ad has finished !) What we DID find was that irrespective of the programme type and the position of the ad in the break, the first THREE SECONDS of each ad was critical - if you can't hook the viewer by then or remind them that this is your ad again then attention falls away. We didn't test print ads.
I hope this helps set the landscape a little for you, even if it is from a "Down Under" perspective.
Agreed. When they are comparing the amount of time viewers spend with ads on each medium, is each a cold read, or have the viewers seen the ads before? Were they all for the same company/product? I'd also be interested to know the demographics of those studied. Some people are going to be more receptive to different ad formats.
And where was the newspaper ad in the equation?
I too am curious to know what tv programming/web sites were used in the study. The whole notion of "worth" as referenced in this article is very misleading. Too much missing in this post to be taken seriously.
I, too, would like to better understand the methodologies of this claim...the worth of online advertising is clearly overstated by the study.
John Grono has it right - TV and magazine ads tend to occupy 100% of the screen or page. For a properly analogous take, the study should have measured the skip-over rate on those margin ads for canoes in the New Yorker and the network logos superimposed in the corner of TV shows.
That said, the point that standard banner ads are easy to ignore is not a controversial one. That's why brand integration into targeted content is the surest way to reach a desired audience.
I'm curious as to how they measured the recall / retention of the tv ads and print ads. They only elaborated on the online part. But I tend to agree with the self-serving slant. Besides, you can always tell when the upfronts are around the corner. All these studies start to come out telling us how TV ads more effective / valuable :-) @robblewis
Talk about a self serving "study." If you are taken in by this article you deserve what you get.
What a surprise that CBS and Conde Nast would come up with such claims. I bet their respective digital groups love them for this tripe.
The near term fact remains that TV rules in media companies. If you're looking to grow or extend a career in digital, neither one of these companies (and their brethren) is the place to do it. Their priorities are elsewhere.
@Brad - I love the butterfly's to the space shuttle comparison!
While I certainly view this study with a degree of skepticism given the source (it's always healthy to view any industry study with some skepticism), I do applaud the effort. I think we should be spending <i>more</i> time on these types of studies in order to help determine the optimal media mix. None of these media will go away completely, but an optimal mix will eventually emerge. To Brad's point - if you take this at face value - advertiser's are <i>still</i> greatly underspending on digital when you factor in costs vis-a-vis impact... did the study sponsors actually improve their message here or are they in effect touting digital?
Thanks for the update from Down Under.
Here in California I encounter far too many digital marketers convincing advertisers to spend most or all of their budget online. Since I offer both print and electronic media space I can earn a living regardless of where the money is spent, but I do see first hand the importance of a well balanced diet of multiple media.
Print is far from dead, as long as the environment is relevant. Most recent report from one of my advertisers is a minimum 5:1 ROI in print. Online banner ads are not seeing anywhere near that level of return, even though ads are in appropriate content environments.
Advertisers look to us to provide expertise that helps them make their money work for them. We need more objective research and case studies at varying investment levels to help clients choose wisely.
For the record, I do NOT see this as 'self-serving' research. The results accord with everything else I have seen in this field. Any research that finds a banner ad equal to a TVC or a FPC in a magazine has simply "got it wrong" for the simple fact that the banner does not dominate the available space unlike a TV or magazine ad does (assuming the mag ad was full-page and I bet that is waht they tested!). Isn't this just plain old common sense rather than being 'self-serving'? Being a researcher I also notice a disproprtionate of "dotcoms" in the company names of those who thought the report "self-serving". Maybe, just maybe ... nah ... such responses wouldn't be to protect business interests ... silly of me to even think it really.
This article is almost entirely devoid of useful information. That said, they are probably right. There's still a lingering hot one for anything online, but the love for the hot new thing must some day fade. Online is just another tool in the toolbox, but you can't build a house with just a hammer.
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There are way too many variables to call this study conclusive by any means. Study participants walk into a TV studio lab. When viewing television, did they simulate a real home environment with a family, kids, and a pet to serve as possible distractions during the 'event' of watching a TV ad? Did they assume one channel only (re: no jumping from one program to another during a commercial break)? As for magazines, did it assume that everyone flips page by page rather than skipping entire chunks of the magazine? As for the Internet, were the ads shown on CBS and Conde-Nast sites? What kinds of ads were shown? And how about questionnaire? What was the research design behind it?
I applaud any research for taking a look into ad effectiveness, but when it's commissioned by two companies that make their mint on TV and magazines, is it any surprise as to what comes out on top? For years, those of us in the Internet ad community (disclosure: the majority of our work is digital although we have serviced clients cross-media) have looked at smart targeting for addressability, something which print will lack at scale due to the cost base of producing a customized magazine and still a few years away until projects like Canoe and Simulmedia get to full speed. The study seems to assume that the ads behind the web pages are untargeted and for untargeted advertising I'm not surprised by the study results.
Here's a link to the full press release on the study results:
http://www.mcpheters.com/news/TVMagazineAdsMoreEffectiveThanInternetAds.htm