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Patricia Calderon, SVP/Managing Director, Stein Rogan + Partners
November 15, 2000, 4:30 - 5:30 p.m. Eastern

<patcalderon> Hi, everyone. Welcome to the discussion!
<shafer> I work for a credit card processing company, and lately we haven't been getting the calls we need, so they are leaving it up to me to do the advertising, we have tried banner advertising, and that didn't seem to work, I'm thinking about sponsorship. What do you think are effective ways of advertising for our type of business?
<patcalderon> In most cases, the question is really about targeting. Are you tracking through to closed loop transaction?
<patcalderon> By that, I mean, tracking how well leads convert to applicants by source. You can probably learn a lot about your proepctive customser that way.
<patcalderon> And that will help you buy better going forward.
<shafer> We help establish merchant accounts.
<shafer> We are not the actual credit card processory.
<patcalderon> I would look at making cost per action buys with willing partners over sponsorships. I feel sponsorships are more appropriate for branding efforts.
<patcalderon> What is a successful result for your business?
<patcalderon> There are many factors that can impact the success of your advertising -- what is your pitch or offer?
<patcalderon> And, are you a well-known brand or do you have to sell who you are as well as what you do?
<shafer> We use a lot of Gateway pages, that has seemed to work pretty well, our hits have been up.
<patcalderon> Always a good tactic to help qualify and direct prospects.
<patcalderon> So, then, if hits are up and calls are down, you seem to be having a problem converting prospects. Is that correct?
<shafer> This is the busiest time of year and all of a sudden we aren't getting that much business as we were in the summer.
<patcalderon> Okay. What, if anything, changed in your marketing? Or in the industry?
<patcalderon> I know the financial community as a whole ground to a halt around the election. Can this be event driven?
<shafer> We have really good rates and usually the people who call purchase an account
<shafer> That is very possible
<patcalderon> Can the people who see your ad transact with you online or do they have to call you?
<shafer> There is about 7000 business that open up everyday and I'm sure if we get our name out there like paypal we can get the accounts
<patcalderon> What venus are you using to reach these new businesses?
<shafer> We don't really have an ad, we are creditcardprocessor.com
<patcalderon> I'd need a little more info to give really good direction, but I would look at tracking your performance by source and message and try to understand what the most effective combination is.
<patcalderon> Then I would buy according to those learnings.
<shafer> Do you have any other ideas that can possibly help with our advertising?
<patcalderon> I wouldn't give up on the banner, but I would test opt-in email, CPA buys etc.
<patcalderon> Test, test, test. It's the best way to get results.
<hairong> How to measure ROI in interactive advertising?
<patcalderon> Good question. Tough answer.
<patcalderon> ROI is determined by understanding success metrics before the buy starts.
<hairong> What makes success metrics?
<patcalderon> Simply put, ROI is calculated by taking the total cost of a campaign divided by the number of sales/clicks/registrations/etc., to get your cost per.
<patcalderon> If you know what you need that number to be, you know your success metrics.
<patcalderon> Let me give you an example. If you sell widgets for $9.99 and you advertise online at a $5 CPM to 1,000,000 people,
<patcalderon> and .5% click on your ad, that's 5,000 people who come to your site.
<patcalderon> If traffic is your metric, you got visitors/prospects for $1 per
<patcalderon> The point is to establish what you want to come out of a campaign before you plan and buy it.
<hairong> Thanks, Pat.
<patcalderon> It will direct everything you do. Then, you need to implement tracking mechanisms (either via third party or internally) to know what you accomplish.
<soljacic> Ok, how does charging through CPM bring a better ROI?
<patcalderon> It doesn't always. It really depends on the offer, the target and the buy.
<patcalderon> We usually start with a mix of venues -- banners, CPA, opt-in email, fixed position.
<patcalderon> Then we read performance against each venue and against each piece of creative.
<patcalderon> Very often, the lower CTR converts better on the back end, making buys that appear initially to be losers become the best sources in the long run.
<patcalderon> Not always the case, but often.
<patcalderon> The problem with CPA buys is that usually its difficult to generate volume. And, they are much, much harder to buy because it's harder for the sites selling that way to make money.
<patcalderon> The problem with email is that it has a much higher CPM out of pocket, so it needs to perform much better to be as effective.
<soljacic> What is the current trend?
<patcalderon> What business category? Trends vary a lot by the business.
<soljacic> For example, in investments?
<patcalderon> Targeting consumers?
<soljacic> Yes
<patcalderon> For finance, we've found that banners can be very effective. The trick is to match up message and environment and track the back end.
<soljacic> How do you deal with clutter?
<patcalderon> Click throughs tend to be low -- .3% or so. but a well targeted message will convert pretty well.
<patcalderon> Great creative. Great targeting.
<patcalderon> Clutter is there in every medium. You can break through by really knowing your customer and speaking right to them.
<soljacic> In creative, is less more or is more more?
<patcalderon> Also, many of the networks offer optimization services that help match messages to environments that generate action.
<patcalderon> Engage, DoubleClick, 24/7 all offer this kind of solution. I recommend it highly.
<soljacic> In banner ads
<patcalderon> Creative needs to be clear, and direct. It's easy to get too clever or have long animations that lose people.
<patcalderon> Also bright colors, and large, clean type are important.
<patcalderon> Consumers are probably not going to click on a banner unless they really, really want to go.
<patcalderon> But, don't be afraid to have a little fun -- just make it relevant to the offer.
<patcalderon> And DON'T trick consumers into clicking on your ad. You'll get more bad will than good.
<soljacic> Thanks, Pat
<patcalderon> Very welcome.
<patcalderon> I could tell a story about my childhood.
<patcalderon> Or perhaps my most exciting media plan.
<soljacic> I would like to know about entering the field
<soljacic> I am about to graduate in May and I am actively searching the job market in Chicago.
<patcalderon> The good news is -- even now -- there are more jobs than people. So it's a good time to be looking at this field.
<patcalderon> I recommend getting an entry-level job in the media department of an online agency and making it your business to get into every aspect of the business.
<patcalderon> Planning, buying, optimizing, analysis.
<patcalderon> What city are you in?
<soljacic> I am in school in michigan, but I live just outside Chicago.
<soljacic> what types of entry level jobs are common?
<patcalderon> Assistant media planner, media coordinator, assistant account executive on the other side of things.
<patcalderon> There are several good online agencies in the Chicagoland area.
<patcalderon> JWalter has an interactive office, as does LeoBurnett. MarchFIRST is here.
<patcalderon> Modem Media has an office. And, oh yes, Stein Rogan + Partners has an office here too.
<patcalderon> I'd check 'em all out. And find the one that feels like home. Cause in media you'll spend a lot of time there.
<soljacic> Thanks for the advice.
<soljacic> What is your company's web address?
<patcalderon> www.steinrogan.com
<soljacic> Thank you
<patcalderon> Welcome.
<hairong> How about traditional and new media integration?
<patcalderon> I'm all for it.
<patcalderon> Actually, integration is really critical.
<hairong> Still, how do you measure its total effect?
<patcalderon> All messaging needs to be consistent and coordinated to achieve the best effect.
<patcalderon> Well, that is tough. But, no tougher really than the task of measuring offline multi-media impact.
<hairong> Any case or example?
<patcalderon> You can do it a number of ways. Survey consumers about what drove them to the web.
<patcalderon> You can set up media tests where you deploy tactics in discrete markets and read lift.
<patcalderon> You can do pre/post traffic or sales bench marking to determine lift against media spend.
<patcalderon> It's not as simple as banners to clicks analysis. But nothing really worthwhile is simple!
<patcalderon> We have found that offline media in conjunction with online tactics results in brand building, awareness and trial.
<patcalderon> The mix is determined by the objective for the brand.
<patcalderon> If you want awareness -- offline is critical.
<patcalderon> If you just want traffic and don't care if the customer knows your name, online tactics are far more cost efficient.
<hairong> Someone says banners ads do branding. Do you agree?
<patcalderon> As you might have guessed, I'm big on knowing what your goals are for each and every media dollar you spend.
<patcalderon> I think everything brands if it's done right. Every time someone sees your name and has an opportunity to make an association with it, brand awareness is tweaked.
<patcalderon> But, I think it's harder to truly achieve branding in a banner ad. Most everyone would agree that TV is the branding king.
<patcalderon> Radio is both traffic/trial and branding.
<patcalderon> Newspaper is far more action/urgency oriented.
<patcalderon> Online leans towards action orientation, but exposure is exposure.
<patcalderon> Amazon did all its early branding and business building online.
<patcalderon> When they gained momentum, they went offline and soared in terms of brand awareness.
<hairong> How about wireless media, are they used as ad media now?
<patcalderon> Wireless is definitely an ad medium
<patcalderon> It's early on in the lifecyle and reach is still very small.
<patcalderon> Also, there are technology issues to shake out before there will be standards and great reach.
<patcalderon> Right now several leaders are all pushing their format (much like the early video tape days -- anybody remember betamax?
<patcalderon> Or 8-track vs. cassette tapes?
<patcalderon> vs. CDs
<patcalderon> vs. Mpeg
<patcalderon> In any case, the media is very fragmented right now and it's hard to buy.
<hairong> It seems advertisers always want to be "intrusive" while consumers hate that.
<patcalderon> Yes ... consumers say that. But they remember those intrusive commercials.
<patcalderon> And when the commercials are done well, they buy the product.
<hairong> How do you solve that dilemma?
<patcalderon> Most consumers understand that in order for certain things to be free or low cost, they need to tolerate advertising.
<patcalderon> Many actually like advertising.
<patcalderon> If an advertiser is too pushy, consumers have the ultimate control. They can decide not to buy the product.
<patcalderon> The ads won't last long without sales.
<hairong> Why do interstitials not become as popular as some wish?
<patcalderon> The problem with interstitials is that they can become annoying if the consumer feels he has been hijacked when he clicks out of a site.
<patcalderon> Also, they are short duration ads which gives the consumer little time to click and interact. So they are better branding tactics, but hard to do well.
<patcalderon> Some sites are now selling superstials -- pop-ups that time-out after a few seconds. Those are pretty effective and minimal irritation.
<aquino> How about rich media?
<patcalderon> Again, the tactic really needs to match the objectives, but in general, we have seen very good results from rich media.
<aquino> Do you think that it works or it just wastes money and time?
<patcalderon> Usually, rich media allows you to interact with the consumer on another level and that often results in really strong calls to action.
<patcalderon> But it is more expensive to produce and often to field.
<patcalderon> For the right offer, it can make a huge difference in ROI. Back end tracking is critical.
<patcalderon> Its kind of like the difference in between a b&w page vs. a color page. Sometimes b&w is the right choice. Sometimes the premium for color is the only choice.
<moderator> Pokrojames' question: "How long will it take to get industry standards that will allow all internet users to receive media-rich info like we have in other standardized media like radio or tv?"
<patcalderon> Now that's a tough question. I'll check my crystal ball.
<patcalderon> Sounds like you are asking two questions -- rich media standards and broadband penetration.
<patcalderon> We're making progress on both fronts.
<patcalderon> Within 5 years, broadband penetration is expected to be significant in the US. Again, though, there needs to be a technology shakeout before it can happen.
<patcalderon> We still don't know if it will be DSL or Cable Modem -- or something else.
<patcalderon> As for rich media, as browsers improve, more and more plug ins come already loaded and people can get rich media without barriers.
<patcalderon> And more and more sites are accepting it and using it.
<moderator> Pokrojames' last question: "What's your evaluation of the internet as a research tool for consumer/marketing research?
<patcalderon> After email, it is the number one use of the web. It is the quintessential use of the web. Commerce is gravy!
<patcalderon> Thanks, everyone! I hope this was helpful!
<moderator> Thank you all for joining us, but unfortunately we've run out of time.
<moderator> Please keep checking aef.com for more upcoming discussions.

 

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