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Many Traditional Marketers Are Becoming Devotees of Cyberspace

A study to be released this morning by the leading trade organization for national advertisers indicates that its members -- typifying the traditional marketers considered laggards in moving onto the Internet -- are increasingly becoming devotees of cyberspace.

The fourth edition of the study, called "Web Site Management and Internet Advertising Trends," will be presented at the annual @d:tech Conference in San Francisco. Previous studies concluded that the members of the organization, the Association of National Advertisers, had been uncertain about the potential benefits of the Web as a medium for advertising and commerce.

But those qualms seem to be fading about as fast as the "I Love You" virus spread last week, according to the study, which was divided into separate surveys about online advertising and Web site management.

The top managers of bricks-and-mortar companies "would have to be nuts not to notice this is a high-potential area," said Robin Webster, executive vice president at the association, which is based in New York.

"Because I'm talking to these people on a daily basis, I can really feel this moving along," she added. "The trends change so quickly, I'd field this study every six months if I had the resources."

Ms. Webster, who is to outline the results of the study at the conference, spoke about the findings in a telephone interview last week.

"The reason advertisers are turning to this medium is because it's different from the others," Ms. Webster said, citing "the involvement consumers have with the Internet" and "the ability to have two-way communications."

The number of association members advertising online in 1999 rose to 64 percent, the study reported, from 61 percent in the study covering the year 1998. At the same time, spending levels increased much more significantly, almost tripling to $1.94 million, as the number of sites built per company rose 41.9 percent, to an average of 6.1 from an average of 4.3.

One finding that Ms. Webster said she found surprising, labeling it an "aha," was a shift in the rankings of responses on corporate objectives for building Web sites.

Though the primary reasons for companies to spend on Web sites remained providing product and service information (No. 1) and increasing brand and corporate awareness (No. 2), those reasons declined in importance by large percentages. Two other reasons climbed up that chart, also by large percentages: using the Internet to develop and improve brand loyalty and providing customer service.

"That shows an increased appreciation in the value of a long-term customer," Ms. Webster said, adding that customers can be wooed through means like sponsored e-mail, co-marketing alliances and other communications methods.

There was another finding in the study that Ms. Webster called "an 'aha,' but not a particularly good 'aha' ": though most respondents said they expected to spend more on Internet marketing in 2000, they were troubled by several new problems related to online pitching.

One such difficulty, according to the study, was a belief that the formats of online ads like banners do not provide enough impact. Another qualm centered on what the respondents considered to be the low "click-through" rates for most online ads.

"This is troubling," Ms. Webster said. "It's something agencies need to work on."

The study was mailed to association members in January and February with final responses -- 208 surveys from 114 companies -- returned in March.

The fact that the respondents to the study "are more traditional advertisers rather than dot-coms" should not significantly change the findings, Ms. Webster said, in that it is predominantly dot-coms that have been suffering in the wake of financial and stock market gyrations since March.

"If the bottom lines" of the bricks-and-mortar marketers "are still healthy, which they are," she added, "I see no reasons why the spending trends should slow."


STUART ELLIOTT, May 9, 2000, The New York Times

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