Their Online Advertising Budgets In 1997 example essay topic

USERS OF INTERNET Nielsen Media Research, which began studying Internet usage in 1994, reported that in 1995 40% of Americans over the age of 12 had access to computers. (Nielsen Media Research, July 1996) 10% of Americans over 16, were online at that time. In their most recent survey, taken in December 1996 and January 1997, Nielsen reported that 23% of Americans over 16 are now Internet users, an amazing rate of growth. At least 50.6 million Americans are now online, according to Nielsen.

(Associated Press, March 13, 1997) "At this rate, within two years the citizens of cyberspace will outnumber all but the largest nations". (Anderson, July 1, 1995, p. S 4) Additionally, according to Nielsen, the number of users who have gone online looking for product information grew from 19% in 1995 to 39% today. Still, only 15% of Internet users have actually purchased products online, indicating that the business value of the Internet is in promoting products, not in sales. (Associated Press, March 13, 1997) According to survey results released by DeWitt Media in February 1997, almost two-thirds of all marketers have advertised on the Internet.

54% of those surveyed plan to increase their online advertising budgets in 1997. (Online Marketing Growing Strong, January 21, 1997) In addition, Advertising Age reported, "of the 100 Leading National Advertisers, 46 have purchased Web advertising" through July 1996, and nearly all have corporate Web sites. Many plan to make online advertising a line-item in their budgets for the first time this year. (Williamson, October 21, 1996) However, the survey also revealed that only 11 of the top advertisers in traditional media placed among Web advertising's top 50 spenders. 67% of al online ad spending came from "Web-based companies, telecommunications companies or computer companies - [who] have nothing to lose and everything to gain by promoting a networked, computer-based medium".

(Ibid) Still, other companies - financial services, travel, healthcare and entertainment, for instance - benefit from Internet ads. (Ibid) As for big-ticket items such as automobiles, Internet ads give consumers a chance to access product information. According to Nielsen vice president Paul Lindstrom, "It's unrealistic to think there's going to be a large market to buy a car over the Web... ". Lindstrom says that the value of the Internet is in promoting items with hefty price tags. 67% of all online ad spending came from "Web-based companies, telecommunications companies or computer companies - [who] have nothing to lose and everything to gain by promoting a networked, computer-based medium".

". (Associated Press, March 13, 1997) Advertisers are concerned with more than the size of the Internet audience, which numbers almost one in four adults in the United States. Demographics and behavior patterns are also crucial to advertising decisions. Men, according to Nielsen, are still the largest users of online services, but "women, who only five years ago made up a tiny 10% of the online world, now are nearing parity... 42% of online users are women". (Ibid) In response to this trend a number of advertisers such as Kellogg, Bristol-Myers Squibb and Express clothing, have recently opened Web sites targeted to women.

(Hodges, November 6, 1995, p. 30) Households with children under 18 make up the largest Internet subscribers at 62.8%, according to Nielsen. (Nielsen Media Research, July 1996) The Internet is also "more attractive to younger Americans: 33.1% of 18-to-24-year-olds and 32% of 25-to- 34-year-olds used it in 1995". (Fawcett, October 16, 1995) In addition, just under half (48.7%) of adult Internet users have college degrees and 40.3% are in professional or managerial occupations. Further, more than half of all Internet households report annual incomes exceeding $50,000. (Nielsen Media Research, July 1996) Nielsen also reports that 25% of all subscribers use their online service at least every other day, and 50% use it at least weekly.

About 15% of Internet users have purchased goods online. "Items most frequently purchased include entertainment items such as books, CDs, tapes and videocassettes (32%), [computer] hardware / software (21%), and airline tickets (14%)". Travel purchases in general, including airline tickets, hotel reservations and car rentals, account for 31% of all Internet spending, according to Nielsen. (Ibid)

Bibliography

1. Ad host Client Services at web html, 1997.2. Anderson, Christopher, "The Accidental Superhighway", The.