• by November 13, 2000

Combating the spreading hysteria about the health of the online ad industry, Engage today released its third quarter Online Advertising Report (OAR). The report's lead finding determined that there is a strong pattern emerging of users who recently saw an online ad to those converting to a sale.

For the first time, analysis demonstrates that seeing ads alone causes sales, according to the report. By measuring how quickly people convert after seeing ads, a dramatic pattern emerges. Users who more recently saw an ad have a higher propensity to convert, indicating a causal relationship between the view and the conversion, even when there is no click.

Engage says marketers should concentrate on attracting loyal customers, not just one-time buyers. Of all customers acquired from ads, 75% only converted once. Of those remaining 25% acquired from ads, those customers resulted in nearly 50% of all conversions.

Also, Engage found that the number of sites seeking advertising increased 35% in the third quarter; average rate card CPM is $33.64, down about 1% during the quarter and signaling continued leveling off of rates.

"This study shows there is measurable and concrete value to an impression without a click," said David Zinman, Senior Vice President, Engage. "That means marketers need to pay attention to the 99% of people that don't click. We think that this realization raises the value of the Internet as an advertising medium."