Marketing Communications

486 CHAPTER 15 E-COMMUNICATION

through documents and pages by simple mouse clicks. Th e growth of the WWW can be

attributed to the user-friendly, consumer-operated pages utilising this hypertext capability.^4

At the end of 2011, there were, on a global scale, 225 million domain names^5 (an indication

of the number of websites). Worldwide, 2.3 billion people (501 million of whom are in Europe)

are connected to the Internet, which is a global penetration (i.e. the number and percentage of

people that have access to the Net) of 32.7% and an average European penetration of 61.3%.

Within the European Union (EU27: 71.5%), Sweden has the highest penetration fi gure of

92.9%, followed by Luxembourg (91.4%), the Netherlands (89.5%), Denmark (89%), Finland

(88.6%), Germany (82.7%) and Belgium (81.4%). Greece (46.9%), Bulgaria (48.8%) and Romania

(39.2%) have the lowest Internet penetration in the EU27.^6

In Europe, 1 in 5 advertising euros is now spent online. Th e big switch to bringing online

advertising into the mainstream media mix continues across Europe. Online advertising has

already crossed into the mainstream of media in several European markets. Th e latest IAB

market tracking study – which collates online adspend from 26 countries – indicates that

total online advertising broke €20.9 billion in 2011, confi rming the consistently steep growth.

Th e European growth in 2011 was 14.5%, which is lower than the 22% growth in the USA.

Th e top fi ve markets in Europe (UK, Germany, France, Italy, Netherlands) account for 68%

of the total online advertising market, down slightly from 69.2% in 2010.^7 Advertisers

increasingly recognise online as a branding medium; video commands a signifi cant and

growing share of spend, and search continues to deliver good and measurable results. Th e

explosion of ‘big data’ has delivered enhanced targeting capabilities, improving monetisation

of publishers’ inventory. Th ere is a trend for advertisers to shift ad budgets from mature to

emerging markets, which is fuelling their online economy. An expanding broadband infra-

structure adds to the attractiveness of those markets.^8 Th ere is a new generation of marketing

practices that are using sophisticated ‘behavioural advertising’ techniques to learn about the

viewer’s interest and provide tailored messaging. TV-like commercials can now be easily

produced, allowing TV assets to be rebroadcast online and the campaign stretched further.

Th e creative power of the engaging ‘rich media’ formats that take commercial messages

across the whole web page has given creative directors a new freedom in design. And the

standardisation of advertising formats and some of the workfl ow processes has removed a

barrier that long held agencies back from recommending the Web. Th ere are other com-

pelling reasons to use the Internet as a marketing communications medium. Daytime is

prime time – audiences that could never be reached before are now available and attentive.

Th e Internet is a medium of a thousand niches – it combines exceptional lifestyle targeting with

a mass reach. Accountability and making budgets stretch further are a strategic advantage of

digital channels.

As online’s share of the market has grown, spend is being drawn from other channels.

Although some of this spend is migrating from the print editions of publications – particularly

consumer magazines and directories – much is moving to the Internet pure play fi rms, in

whose hands the market remains highly concentrated.

Direct mail is suff ering as customer acquisition budgets move to search, and retention

budgets move to e-mail marketing. Classifi ed advertising in newspapers and magazines is

fi nally migrating to the Web, with recruitment the largest single advertising sector online in

several markets, and much of the advertising spend evaporating in favour of free-to-air models

or disinter mediation as consumers access company websites directly.^9

Chapter objectives

While we are witnessing more enthusiasm for the integration of Internet marketing tactics in

today’s marketing plans, few brand managers have a clear idea of which of these tactics are

most appropriate for accomplishing various marketing objectives. In many cases, a trial and

M15_PELS3221_05_SE_C15.indd 486M15_PELS3221_05_SE_C15.indd 486 6/6/13 8:55 AM6/6/13 8:55 AM