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HowMarketing Research Can Be Used To Evaluate the Effectiveness ofInternet Advertising for Reaching a Specific Target Market

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Overview

In the past, new technology hasinitiated many innovations and one of them is internet advertising.In the quest to evaluate the effectiveness of internet advertisingmarket research has to be incorporated. The research methods consistof online survey, customer tracking and the 3D software. Innovationshave changed the way market data is gathered for analysis and fordecision making. This article provides a summary of marketingresearch innovations on evaluation of effectiveness of internetadvertising for reaching a specific market.

Themarket research assist managers to get information that aids inidentification and definition of market opportunities and problems,analyzing marketing action, monitoring market results and enhancingthe understandings of marketing processes (Chou et al, 2004). Manyorganizations use the internet as an advertising medium due to itsefficiency and ability to be utilized for accessing advertisementinformation. The Internet provides the possibility of exchanging andpassing information by means of interconnected computers (Hayet al, 2003).Anybody with a computer and a modem can perform communication throughInternet and web. Internet has many features but the Web is moreutilized and popular. This study touches on the Web as anadvertisement medium, with the intention on the responses which theonline respondent or customer proceeds through when connected toweb-based commercial advertising tending to persuade the customer topurchase a product, use a service or go on into a given action.

Asnoted by Chouet al, (2004) toacquire an integrated advertisement approach, companies endeavor toincorporate online advertising messages. Despite the fact that allthese advertisement messages are incorporated in the onlineenvironment, the aspect of web-based commercial communication, forreasons of this study, is based on the definition of integratedcommunication:theanalysis application.

TheInternet is an important interactive communication media. It hasdifferent featuresfrom traditional communication media. Clifton(2008) explainedvarious characteristics of the Web. The notable characteristics areits flexibility. It is much more flexible than a traditionaladvertisement or catalogue, because of ability to collect new andupdated information on direct feedback gotten from consumers.Advertisers can come up with a communication between themselves andthe consumer. Therefore, online medium differ from traditional mediumand should not be incorporated in the same way. Traditional mediainvolves a one-way communication process from the marketer,advertiser to the final consumer in a web based communication acustomer is viewed as a sole individual and not the whole group ofcustomers. Clifton(2008) saysthat if consumers use Internet for communication, they have certainneeds with the medium.

Whetherthe consumer is online or offline, he or she has passed throughphases of advertisement messages that have the intention ofpressurizing the consumer to purchase a product, use a service or goon to specific action. Many models have been derived to explain thephases which a consumer goes through when moving from a form of notbeing aware of a company’s product to real purchasing behaviors. Models such as AIDA model hierarchy of effects model (DAGMAR model)innovation adoption model and the information processing modelillustrates this. These models offer consumer’s response processescomposing of shift through a series of cognitive, affective andbehavioral stages (Hayet al, 2003).This series of response has been put to test by many researchers.Exploratory research goes into details on unknown phenomenon of aresearch and identifies main concepts and results of a problem ofunfamiliar situation. This study is an exploratory study because itinduces investigation of how market research can be used to determineeffectiveness of online or internet advertising.

LiteratureReview

Thetheories of marketing are under massive alterations due to greatemergence and deployment of online technologies for advertisement andmarketing. For instance, use of UPC scanners continuous shoppingprograms, online financial credit and debit card, store tracking,caller identity system, real simulations and internet have greatlyled to emergence of information on customers and their purchasingpower.

Internetdata collection, storage and its retrieval has provided manysecondary data on trends in global markets and the environment whichis competitive in nature. The databases have issued more informationon purchasing behavior of households. The market research hasenhanced and expedited collection of primary data. Real simulationpermits producers to experiment emerging market ideas in a short timepossible in a cost effective and confidential manner (Hayet al, 2003).

Anyonecan do research on online advertising and many managers have usedthis vice in aid of networked computers, analysis of date and searchengines of interactions to get or acquire manufacture information.

Peoplehave just begun to see these changes in marketing research when theinternet advertising scales up more in households and business, whenonline communication increases and when networks are linked to newdevices. These devices include wireless devices. Market researcherswill find it easy to collect data on customers based on their needand preference and purchasing behavior leading to few concepts onmarketing research being untouched (Hayet al, 2003).

Variousmarket researchers have done a lot of research on the suitable typesof advertisements. One researcher named Ackerberg (2001) used thepanel data to categorize advertisement effects into two namelyinformative and prestige. He used the newly launched yoghurt toestablish the purchases behavior by customers and it showed that anyadvertising can have an effect on the customer. In addition, thereare inexperienced customers and it is worthwhile to use theinformative advertisement since the use of advertisement which linksthe product with a preferable image has less impact on the newcustomer. The advertisements have an effect on the customerpurchasing behavior if it gives the information necessary for him orher to buy a product. The decision on the type of an advertisementmedium to be used has been coined by several researchers. Poon &ampSwatman (1997) used the experimental means to measure theadvertisement methods on the soup company. They realized that throughvarious methods, they can vary the method selected and also thestrategies to be used. The experiment enabled them to look andcompare the sales and the advertisement budget.

Useof internet has great impact on the advisement of a product.Traditional advertising for instance entails the exposure but in theinternet, customers or consumers chooses only certain advertisingmessages and also the time being exposed to it. Poon&amp Swatman (1997) haveelaborated the factors which influence the exposure in the internet.A visitor at the internet chooses what on, what to see, when and byhow much. Sometimes, a customer may not find what is useful and henceterminate the page through clicking out.

Marketresearchers have described internet or web as a two way communicationsystem which enables efficient advertising unlike the traditionalmodels which are one way communication. This paper suggests theimportance of initiation of fresh concepts for online advertising asa method of advertising.

Onlineadvertising need to give and accounts for the customer’sattraction, need and participation, his or her retention and goodcustomer relationship. Despite the fact that the study involvesapplication of internet for advertising, it also laments the abilityof an internet to being a new communication medium. When evaluatingthe effectiveness of a given phase of online advertising, thefollowing are taken into consideration

  • The methods in which customers are acquainted of a given website and the means in which they become acquainted of the messages.

  • Means in which people goes through in utilization of various links.

  • Feedback acquisition in a direct way

  • The internet discussion or interactive means

Theonline advertisement has several features and the following aretaking into consideration when evaluating them the commoncharacteristics of online customers or respondents and the differencebetween internet and traditional means or medium of advertisementfeatures (Iyeret al, 2002).

MarketingResearch Problem

Howis marketing research used to evaluate the effectiveness of Internetadvertising for reaching a specific target market?

TheObjectives of This Research Includes The Following

PrimaryObjective

Todetermine howmarketing research is used to evaluate the effectiveness of Internetadvertising for reaching a specific target market.

Secondaryobjectives

  1. Provision of a marketing research plan to help understand present developments in internet advertisements

  2. Come up with benefits of and problems of the marketing research plan

  3. Find the consequences of marketing research on online advertising.

&nbspAssumptions/Hypotheses

  1. A respondent involvement in a competitive market is linked to the effectiveness of online advertisement.

  2. A respondent involvement in choices of a product is linked to the effectiveness of online advertisement.

  3. A respondent immersion in the immersive or competitive market is linked to the effectiveness of online advertisement.

  4. A respondent immersion in immersive or competitive market is linked to the effectiveness of online advertisement.

  5. Extend of noticeable presence connects with the relationship between a product introduction involvement and online advertising.

Researchdesign

Inmy study, market research tool has incorporated the following stages

  1. Planning research problem

  2. Development of research strategy

  3. Data collection methods

  4. Collection, analysis and interpretation of data

  5. Recommendations for decision making

  6. Implementation and evaluation.

Marketresearch methods on internet advertising are categorized into primaryand secondary sources of information for determining theeffectiveness of internet or online advertisement. These sources arefaster and cost effective in evaluating internet advertisingresearch. In this case, primary sources include interviews, groupdiscussions, mailing survey, observations and experimentations areused. They have varied advantages and disadvantages and these methodsare suitable in determining effectiveness of internet advertising(Iyer et al, 2002).

OnlineSurvey

Thisis done to collect data in internets and is performed by putting aform with questions to a web server. Any customer who clicks on thissite will be able to visit the URL in an ad. An email is sent andrequested to answer the set of questions. The answers areautomatically stored in the database to be analyzed.

Asnoted by Phippen, Sheppard &amp Furnell (2004), a lot of companieshave used online surveys and have compared with traditional methodsand have noted that respondents using internet have many opinions onsatisfactions. Concerning purchasing behavior, web respondentsprovided opinions related to real behavior. The (Socratic Technologyreport) methods allow data collection at a small budget and themarginal cost for collection is zero. Quaker Oats also did a study onrice snack. This company had been using traditional methods ofadvertisement attitude for up to nine years and was debating if tomove to online advertisement. Hence, they did online advertisementsurvey to compare results with traditional advertisement. Intraditional advertisement, data was collected by identifying suitablerespondents and each given 250 points worth $2. However, the companygot many responses dealing with no awareness responses. The companyalso did online survey at some cost but surveyed three times morethan traditional means.

Fromthe above examples, it is realized that the cost per interviewee inonline is lower than in offline. Thus, market research is used todetermine online advertisement need to use electronic questionnairesto minimize production cost and mailing costs. Due to use of onlineadvertisement, minimized respondent cost is necessary. Onlineadvertisement can be done in two weeks at a lower cost though thiscost depends on sample size (Poon &amp Swatman, 1997).

Marketresearch shows that online advertising is faster. For instance, totest alternatives for a cover of a magazine on teenagers, a publisherchose 300 respondents at par with a reader choice, in a researchcompany online. Each was sent an email to open a given website toevaluate certain aspects. Responses were being gotten in less thanten minutes after mailing. Nearly all responses were gotten in a day.The interviewer then made an alteration to the cover and emailed therespondents again for the three consecutive times in five days with aresearch cost of up to $5000.

Theonly limitation of online advertisement through online survey is thelimiting sample. In addition, not everyone can access internet,unlike telephones. Few internet users do not represent the wholemarket population targeted. The males were also found to exceed thenumber of females by far. Due to this limitation in onlineadvertisement, the following should be done:

  1. Selecting samples: this involve coming up with a large panel that is selected to represent online market population. In turn, a sample is gotten from such panel to provide market research data on online advertisement.

  2. Adjustment of online market research results. This is done to represent the whole population differences in sample and target market. This is done by giving more weight to female responses than male.

  3. Emailing the respondents: this declines the biasness of selection which arises due to those able to access internet fills the forms. This is cheaper.

  4. Provision of link to give a good sample form.

  5. Provision of incentives for participants in online marketing research, provision of incentives is easy for instance free gifts to participants of a given study. Caution need to be taken since some respondents may abuse this program.

OnlineGroup Discussion

Inmarket research, online focus groups is an exploratory researchdesign which aid companies to be acquainted of customer need,shopping behavior, decision making and response to market idea. Thisbrings up five to twelve respondents in a formal setting anddiscusses each ones attitude, perception and motivation or desire.The interviewer just coordinates the focus discussion on the programand this usually takes one to three hours and is usually taped inaudio or video which are later given codes and analyzed at a givenrequired time (Louvieris &amp Driver, 2001).

Thishas advantages in that it collects quality data in a short time at alow cost. It is possible to know customer reaction to new commodity,package promotion and internet advertisement. It enables theinteraction of client and a customer on online advertisement. Thelimitation here is that the results of the group on onlineadvertisement don’t represent whole population due to sampleproblem.

Toavert this, only advertisement uses two types of technology mainlythe videoconferencing and internet chart. Videoconferencing involvesbroadcasting in a TV where everyone follows the proceedings and thereis no need to travel. This research can be done everywhere. Itenables reduced travelling cost and participation in large numbersand wide geographical representation type of focus group. However,there might be delay in transmission and reduce client and customerinteraction (Poon &amp Swatman, 1997).

Internetchat enables participants to join together in an online group using acomputer instead of meeting in a facility to discuss a givenproduction a market. It enables a group coordinator and participantsto write a message and post it and also scrolling other responsesfrom other participants. The participants are gotten from forums,social networks or banners or telephones (Louvieris &amp Driver,2001).

Infuture, online advertisement will incorporate the usage of videocameras and internet connection as a basis for online focus group,providing clients and participant’s interaction on videoconferencing and internet chat at a low cost and ease convenience. Itwill use 3D capability to test the participant reaction to newproduct advertisement (Louvieris &amp Driver, 2001).

ExperimentationMarket Research Method

Onlinetesting

Thisis done at the end of product development in order to determine theconsumer demand and take necessary action to increase itsconsumption. It is used to evaluate the effectiveness of onlineadvertisement of a product in addition to design, price andpromotion. Despite being slow and costly to practice, it can bemodified by use of 3D graphics (Furrer &amp Sudharshan, 2001).

Forinstance, in a market research, a company may introduce a sampleproduct and administer in a given targeted market and use the pointof sale scanner to track the sales in addition to warehouse sales andmovements. This research enable testing product in a competitive orimmersive environment representing many customers and providingmeasures of marketing. However, test market research evaluates fewoptions and can be interrupted by competitors (Louvieris &ampDriver, 2001).

Toavert this, a firm can adopt alternatives which are accurate andquick by use of simulated test market. It provides the customers withnew product and market programs (Furrer &amp Sudharshan, 2001).Virtual Shopping Simulation as a research method enables 3D computergraphics to create appearance of a shelf on screens of monitors andcustomers. Several researches have been done in use of virtualshopping simulations as a tool for research (Poon &amp Swatman,1997). This was first done by Goodyear Tire. It was scheduling toexpand tire distribution above its stores to overall merchandise andlarge merchandise store. The Goodyear Tire intended to evaluate itsname in the new channels and come up with profitable price andwarrants. The market research sampled 1000 respondents to makeshopping in various simulated stores where their prices and warrantsof different brands had been manipulated. In this case simulationpermitted Goodyear Tire to approximate the price and warrant of allbrands of tires.

Thesimulation market research can also be used in online advertisementof other packaged goods. For instance, Fritolay adopted VirtualShopping Simulation to determine effect final displays and shelfadvertisement of snack foods. The new online advertisement is able tomeasure consumer chances of turning to salty snacks or cookies.Johnson and Johnson’s care products uses the online advertisementto gauge price for Uristat used to kill pain caused by urinaldiseases.

Marketresearch has enabled the creation of new technology which enablesmarketers to initiate greater virtual purchasing. For instance, CAVEis a new technology using video projectors and glass made of stereoto initiate an immersive simulation for customers. Its cost isexpensive but will drop suddenly with time (Lee et al, 2003).

Kiosksand Electronic Shelf Labels

Thisis a market research innovation which enables conduction ofexperiments in a store. A wireless electronic labeling using LCDsshowing product name and price can be used. The information shown ispassed electronically from computer store to registers. The pricescan be changed electronically enabling retailers perform experimentson price (Lee et al, 2003).

Thisresearch also enables testing of how program is performing in themarket. For instance, installation of touch screens kiosks in retailchains. If a customer inserts a card, it brings out products andinformation on customer previous purchases. Various advertisementscan be issued to a group of customers. From the card, the discount onthe product is deducted in an automatic manner and at the end of theday, the number of customers who redeemed the offer can be deduced(Gurau, 2005).

Observation

Thisenable know what respondent do at an online site. Any activity fromrespondent in a site comes up with a request of information fromvarious servers. Every request is put down. The limitation of thisonline advertisement is that it has no continuous data put down by aserver. Due to internet having no state, every request fromrespondent’s browser to the server is seen as a different or newtransaction which is recorded separately. Therefore it will bedifficult to identify the identity of respondent.

Fromthe view of market researchers, respondents’ data in onlineadvertisement is crucial to be understood. This will enable marketersto meet the wants and preferences of every customer. This is themajor benefit of digital interaction. Log files are a good source ofinformation in making marketing decisions (Gurau, 2005). However,there are problems from web servers whereby the information capturesonly customer purchasing behavior and is limited to explanation. Inaddition, it is hard to acquire the identity of a respondent or itsonly behavior. Also it is hard to follow respondent visits acrosssites which are competitive (Lee et al, 2003).

Theworld is at initial stages to trying to understanding how to use datain guiding advertising decisions mostly at customers’ level. Oneway is to group respondents based on the way they search informationor search patterns. As a result of that, grouping can be important toadvertisers, in that it permits them to appreciate faulty series thebeginning of the process and take early interventions thereforeraising the odds sales would result from a respondent. For instance,if at the initial elements of a search series showed that therespondent is undecided on products selected electronically agentscan issue information only on commodities which has high probabilityto be interested by the respondent in internet advertisement. Thiswill be important (Lee et al, 2003).

SecondaryMarketing research sources can also be used to evaluate theeffectiveness of internet advertising. There are a lot of searchengines including altavista.com, yahoo.com, ask.com or google.com.Its cost is significantly low. The online sources provide

  1. The company information

  2. Consumer information

  3. Internet information

Theproduct online advertisements are available in many sites and therespondent evaluations are interchanged with measures advertising theproduct. Internet has a lot of news groups and is home to manyproduct developments and the discussions from the groups are storedand available for retrieval. In addition, there are companies whichhave own discussions but don’t provide all the information theyhave with their respondents.

Thereare many limitations concerning online advertising. For example,overall engine searches vary in coverage of links. Onlineadvertisement is also time consuming and introduces large irrelevantinformation. However, The Company can use information on effectivesearches from its site to improve its product. To enhance efficiencyof search process, an index value is attached to sites in order toshow if the information at a site resembles the requestedinformation. Also collaborative filtering is used to suggest books tothe customer on the purchasing behavior of customers with sametastes. Internet advertising may disrupt customers from concentratingon information quality. Anyone can advertise on internet andcustomers need to take care on online advertising not unless he orshe knows the source or trust it.

Themarket research shows that effective online marketing is faster, costeffective and easier. Therefore small companies can afford to doresearch first before incorporating online advertising on theirbrands. A company can have a website to get feedback from customersat a small cost while the big companies can also evaluate ideas andmarketing ideals by using the similar market research (Albrecht &ampJones, 2009).

Thereare various advantages of doing market research before incorporationof a product in the internet such as the following:

Continuousmarket research aids in management decisions. Many organizations areputting more finances on the information communication technologiesand to enhance their results and future performance (Albrecht &ampJones, 2009). This will aid in following loyalty of customers,marinating good customer care, initiation of various programs,personalizing advertisement programs and improving and retention ofcustomers. The following are steps which can be followed

  1. Getting a sample from the population

  2. Doing focus group discussions to establish customer needs

  3. Establishing biggest profitable segment

  4. Design and test alternate programs

  5. Choosing best program

  6. Marketing the program

Inmarket research an internet advertisement, a company can

  1. Get information on many sources on the whole population

  2. Use population information to conclude the customer needs

  3. Determine the value of each customer

  4. Provide market programs based on customer needs

  5. Follow customer purchasing behavior with them

Anotheradvantage is that customers become part and parcel of market planprocesses. A company can establish a panel consisting of customers toprovide continuous inputs. However, a product idea can be leaked to acompetitor.

Acompany can gather information o customer preferences. This willenable the firm to identify what each customer value on the products.In addition, a company can give better services to its customers.

Inaddition, market research enables more undertaking of controlledexperiments. Market research facilitates continuous use ofexperiments. Thus online advertising serves as a lab where it gives acontrol at a low cost. This is crucial in advertising a new brand byaid of techniques whereby the future scenario of a product isdepicted in an effective way.

Marketresearch enables development of new techniques in onlineadvertisement. The internet has made it easier to collect quantitydata from the web and getting insight on it.

Conclusion

Inthis paper, I have elaborated how market research methods are used todetermine the effectiveness of online advertisement. There is aminimal research to assist researchers or marketers in choosing thesemethods. The best approach is to use online advertisement in allproducts advertised in order to see the benefits. Market research hasshown that online advertising is faster, cost effective and flexible.Lately, there has been speculation on the role of market research inaffecting management decisions. Most managers believe thattraditional methods of advertising don’t give important informationand comes very late. Digital advertising gives opportunity to addressthe hindrance of present traditional mode of advertisements.

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