I’ve been wondering how long it would take for the big players to shift the big money online, and it looks like Microsoft is heading powerfully in that direction based on this story from Media Daily News.
I’m not sure Microsoft is really a bellweather for corporate ads as MS is a technology company that does a huge amount of business online and has a huge online customer base, but whenever close to a billion dollars is shifted from conventional media to online it’s a significant development in the advertising landscape and probably an indicator of things to come from other major advertisers.Since I did several conversion studies many years ago in the travel sector it’s been clear to me where things were headed as these strongly indicated that online advertising is far more effective than print ads. As an online marketing guy for Oregon travel projects we ran full page Sunset ads featuring huge displays of separate domain names that I assigned specifically to each campaign. This made tracking easy and also kept users from having to type in long, cumbersome URL strings. Despite this we saw very modest traffic increases from major print exposure. A 20,000 full page print ad would only yield a few thousand extra website visits over the next month. Initially this came as a shock to me but after dozens of experiments in many magazines, and an examination of other print advertising campaigns, it became clear that it’s foolish to try to drive web traffic using print. Although we did not run any signifiant TV or Radio campaigns I examined some data from Texas’ Travel web efforts and concluded that TV was also a prohibitively expensive way to drive web traffic. Online methods generally outperformed offline by a factor of perhaps 10x, and this advantage does not seem much less today.
Yet there is a type of momentum that comes from human stubborness that keeps TV, print, and radio advertising over-funded even as conversion studies are now abundant indicating the superiority of online advertising. Recently I think it was Ford that decided to increase the online spend considerably, though I think this news from Microsoft is the first time a major advertiser has chosen to move most of their spend to online venues.
Eventually online costs may catch up to conventional media in terms of ROI, but I think this is not the case yet. That’s not to say that positive ROI in online ad campaigns is a simple process – it is not and many millions are squandered in bad online campaigns. But this pales in comparison to the *billions* that are squandered every month on ineffective offline media campaigns. The offline advertising Emperor has very few clothes, but few will notice until people start doing quality mathematical analyses of advertising campaigns and stop listening to self-serving research. I’m not holding my breath for that.