Purchase Intent of Consumers Has Instigated the Rapid Rise of Online Advertising, Bringing Drawbacks Such as Digital Privacy Concerns for Online Users

• Online advertisements differ in functionality and size in order to attract a large consumer base  
• Through eye-tracking methods and other studies, research has shown which strategies advertisers should utilize to increase purchase intent of consumers
• Digital privacy issues have become a concern to online users because of “cookie files” and retargeted advertisements that track their online behavior

The onset of the Internet brought about a number of things- information, networking, and online shopping to name a few- and with these new facets, online advertising has become a new tool for advertisers, as well as a source of revenue for publishers of websites.  Online advertising is a booming business, garnering approximately $121 billion globally in 2014 with the potential to reach about $140 billion in 2015.  Why are advertisers spending such impressive amounts of money on these advertisements?  This question boils down to one answer: online consumers.  Through research conducted by advertisers, online advertisements are perfected to catch the eyes of consumers and increase their purchase intentions.  Through methods such as size, placement, increasing noticeability, and matching ad content to the webpage content, advertisers are constantly learning how to curate ads to attract consumers.   

Online display advertisements vary in functionality and size in order to attract online users 

Data taken from 2013 IAB
Internet Advertising Revenue Report

Online display ads are graphic images that vary in size, animation, duration, size etc. that are used as a form of marketing that use the Internet to deliver messages.  Display advertisements can be a range of types including static ads, which are simple images that are hyperlinked to an advertiser’s site.  They combine only still images and text. Another type is animated ads, that contain .GIF or Flash formats, meaning that the ads contains movement.  Interactive ads contain tools and games that give the user some type of function in addition to bringing them to the advertiser’s site.  Video ads play a video for the user that can either play automatically, or can be user-activated depending on the ad- these are the most expensive because they have a high CTR, or click through rate of users.  Yet another type are expanding ads that increase in size when the mouse rolls over it or when the ad is clicked.  The expanding ads have variability in the sense that they start as a static image and expand into a video ad.  Increasing functionality of online ads may be expensive for advertisers, but they do reap rewards- the revenue generated by online ads in the United States far surpasses other types of media in the US that displays ads, at an astonishing 43 billion dollars.  The pie chart on the upper left illustrates this idea.

Online ad sizes vary greatly- the 3 most common are leaderboards (or banners), medium/large rectangles, and skycrapers (or towers).  Leaderboards are typically found at the top or bottom of a webpage that stretch from end to end.  Medium/large rectangle ads are another type, and usually interrupt the text content, which gives the ad a higher chance of being noticed by the user.  Skyscraper ads are tall ads that typically run down the left or right side of a site.  Doron Haramati, an analyst at Nielsen, the American global information and measurement company in New York, explains why certain dimensions of ads can be essential for attracting online Internet users. 

Research has shown which strategies advertisers use that increase purchase intent through eye-tracking studies

Eye-tracking studies are helpful in seeing how long users view online ads, as well as click-through rate (if the user clicks the ad).  EyeTrackShop, an award winning market research company, conducted a study where participants allowed researchers to access their webcams, which were then adjusted to calculate eye movement as webpages were viewed.  Researchers concluded that there were certain factors that were most important to a consumer spending time to ads online.  Ads that are placed “above the fold,” or that are placed in the top content area of the webpage, are higher in terms of visibility, time spent, and time to notice, as opposed ads that are placed in the bottom content area.  Data also suggests that an ad placed at the bottom of the screen, but still above the fold, is seen 225% more quickly than some leaderboard ads at the top of the page, because many users skip ads placed on top, since they scroll quickly and assume those top ads are irrelevant. Mr. Haramati expands on the idea of users scrolling quickly past ads, with a term known as “banner blindness.” 

Non-traditional placement of ads, or ads placed in unconventional places (e.g., integrated into a search result), are more effective than ads that are in traditional places.  In another test conducted by EyeTrackShop, participants saw ads that were placed unconventional in the margins of a webpage 50% more quickly than the standard display ads towards the middle of the page.  The last factor that EyeTrackShop concluded was important in effectiveness of ads (besides placement) is relevance. Matching content of the ad to the content of the webpage makes it easier for users to recall the ad.  For example, in another test run by EyeTrackShop, an ad for a brand that was not well known (fluless.com) was recalled 82% more by participants than a more well known brand (AT&T/Android) just because the fluless.com ad was related to the content of the webpage. 

Eye tracking is used to see where
an individual focuses his/her gaze
on an advertisement

A study conducted by Massachusetts Institute of Technology (MIT) explored the reactions of consumers to online ads.  They discovered that obtrusive ads (which makes the ads more noticeable to users by placing the ads in unlikely places) or matching an ad to website content do increase purchase intent of consumers (by ~4%), however both strategies used together are ineffective at increasing purchase intent of consumers.  It is surprising that both methods yield a positive result separately, while together they both cause a negative effect.  A reason MIT lends to this phenomenon is that users may view these strategies combined as a manipulative advertising tactic, thus lowering purchase intentions.  Because deception online is so common, users are particularly aware of manipulative behavior so that obtrusive and targeted ads may make the user more aware of the targeted nature of these ads.  Privacy concerns are another issue users may become aware of, where the usual customer appreciation of targeted ads (because of their helpfulness), is disregarded because of the obtrusiveness of said ad.  

Mr. Haramati elaborates on 3 items an online advertisement should contain in order to attract online users.

Privacy issues may be a concern to online users who are exposed to “cookie files” and retargeted advertisements

Cookie files and Retargeting
explained through this visual

In order to match content of an ad to the content of a webpage, companies use cookie files to track online users and store information about their preferences.  The company then buys ad space on another site, where they can embed new ads that display products someone has previously viewed and is interested in.  These ads that have been created through cookie files are also known as retargeted ads.  Retargeted ads are extremely common on most sites on the Internet.  The reasoning behind this method is that, because the user has already displayed interest in the item, advertisers think the user is a more eligible prospect than someone else to buy the item.  Methods like these are of concern to online users who fear their privacy is being compromised.  This has led to the introduction of bills in Congress, who have called for a tighter regulation of digital privacy, like the 'Do Not Track' Privacy Bill, that enables certain systems to give users the ability to opt out of behavioral advertising.  

While many online users are aware of ads on webpages, most people are unaware of how much these ads affect them.  Where an online ad is placed, why the ad matches the webpage content, and even just the dimensions of the ad are carefully curated in order to attract consumers and increase their purchase intent.  Furthermore, digital privacy concerns have become an issue with ads due to cookie files and retargeting.  With these factors in mind, it is important to be knowledgable about the content users view online so that they can make informed decisions when purchasing products and so that digital privacy issues can be resolved.  

MTV’s Televised Music Videos Introduced New Advertising Methods and a Visual ‘Artist Image’ that Revolutionized the Recording Arts Industry

• The creation of MTV brought a new way for artists and management labels to advertise through music videos. 

• Music videos allow artists to create an image for themselves, which helps develop loyal fan bases that wished to emulate them.

• MTV’s music videos became the foundation for music videos that stream on other platforms such as YouTube and Vevo, which can help aspiring artists be discovered.

Before the emergence of MTV (Music Television), artists could only promote themselves and reach new audience segments through the radio.  Having only one avenue for exposure led to a lack of consumers' brand identification with artists and difficulties in building the type of loyalty that results in albums flying off the shelves.  The onset of MTV cultivated a new type of platform, through which labels and artists could now market to potential consumers through music videos.  The popularity of this new media format had an immediate impact on the music industry, and its prominence within the space has made music videos an important element of an artist's content creation, especially with the rise of media sharing sites such as YouTube. 

The establishment of MTV in 1981 brought about a new way for artists and management labels to advertise through music videos.  Music videos are primarily short films that play a song from an album, which back in its inception, were shown on TV channels. The music label and management of an artist/bands are able to control their image and save money by not having to take the artists on extensive promotional tours to build a following. Until MTV and music videos became popular, artists would only be seen at concerts or live public appearances; afterwards labels would be able to take one video, send it to MTV and have it streamed in many slots for mass viewing.  With repeated performances playing on MTV’s twenty-four hour channel, MTV provided the recording industry with a better alternative to simply advertising through words. 

MTV introduced a new way of advertising for artists through music videos, as well as the idea that a single song could market a full album.

The key element of MTV’s revolutionary method of music promotion was the creation of one, single song as the driving force in the marketing of an entire album.  While the concept of a 'single' seems commonplace in the music industry today, this manner of marketing an artist was not as typical at the time.  The success of one song would likely result in the video viewer going out to purchase the whole album. 

MTV's introduction of the music video ushered in a new art form that combined the audio aspects of the radio, as well as the visual imagery of the TV screen.

With the invention of the music video, artists were able to incorporate both audio and visual imagery together.  While hooking an audience with music quality and sound has always been integral to an artist’s success, familiarizing consumers with an artist’s style and persona via visual means could strengthen his or her brand. In that sense, the melody and lyrics of a song could only do so much.  The visual element that music videos added to the repertoire of an artist allowed for a deeper relationship between artist and fan, and in many ways helped provide an avenue for greater identification with an artist’s lyrics and themes.  The music video became a new and evolved art form for artists to not only expand their creative expression, but foster richer connection to fans by providing additional insights into their lives and emotions.

  

Artists were now able to express themselves visually through these music videos, and by doing so, create an image for themselves that would develop a larger fan base.

Aside from providing a new medium for marketing to a mass audience, music videos also allowed artists with a new ability to more personally craft an image for themselves.  This image would solidify the identity of the artists and cultivate a fan-base that was unique to him/her.  So, while MTV’s main focus was on providing entertainment to the public, its music videos also became tremendous cultural transmitters. Cultural transmission is defined as 'passing on culturally relevant knowledge, skills, attitudes and values, from person to person or group to group'.  Now an artist or band’s image became extremely important because they would be able to develop a ‘cult’-like following in which individuals who identified with them would desire to act and dress like them.  For example, hair bands and their establishment within culture of the 1980's was primarily due to success of bands such as the Motley Crue and the aesthetic of their fashion and look playing well on the music video format.  An end result to music videos having this element of cultural transmission allows them to set what is included in known culture. This helps to create new and loyal fans who wanted to be in on the trends. 

 

These music videos were the building blocks for popular video streaming sites, such as YouTube and Vevo, which now can also help aspiring artists get discovered.    

Data excerpted from 2014 Nielson Music U.S. Report 

MTV’s music videos became the   foundation for music videos  streamed on other platforms as well.  While “listening” to music might have once meant simply that, the modern method of consuming music frequently engages more than auditory senses. YouTube and Vevo are two such platforms that demonstrate the power of user-generated content in combination with audio and visual imagery.  Both sites allow users to upload, share, and watch videos.  MTV and its music videos paved the way for this development- they created a new demand and a new lust for music videos.  The popularity of these videos is astonishing – as shown on the Nielson chart shown above.  This chart displays the top music videos streamed in 2014.  Among the top three are Meghan Trainor’s All About That Bass with ~188 million views, Idina Menzel’s Let It Go with ~183 million views, and Katy Perry’s Dark Horse with ~181 million views.  Additionally, music videos today play a key role in the music space beyond impacting the marketing plans for super stars like the above. With the popularity of media sharing sites such as YouTube, and the ease of sharebility afforded by social media, music videos, albeit at typically a lower production quality, can help aspiring artists get discovered. Megastars such as Justin Bieber and Carly Rae Jepsen both benefitted from the exposure of these channels, and “do it yourself” versions of the music video.

Music as we know and consume it today would never have been possible without the introduction of televised music videos by MTV.  From Video Killed the Radio Star, which aired on one MTV channel in 1981 to 2012’s Gangnam Style with over two billion hits on YouTube, music videos have certainly changed the way the world experiences music.