E-Commerce Assessing the Effectiveness of

E-Commerce Assessing the Effectiveness of Online vs. Direct Advertising and Marketing Communications The pervasive adoption of digitally based approaches to advertising and marketing communications continues to accelerate. Banner ads, e-mail, and viral marketing are all proliferating due to the low cost of implementing them and the ease with which they can be tracked over time (Pauwels, Weiss, 2008). Direct advertising and marketing communication strategies including customer service, direct mail, telemarking and direct sales forces are proving to be increasingly costly and less effective when compared to their digital alternatives (Spilker-Attig, Brettel, 2010).

The intent of this analysis is to evaluate how online vs. direct advertising and marketing communications vary from each other, which is the most effective, and how the spending patterns are shifting in favor of digitally based approaches. Comparing Online and Direct Advertising and Marketing Communications The online advertising and marketing communications tools of banner ads, e-mail and viral marketing each serve a useful purpose in attracting and selling prospects online.

The banner ads are the most commonly used digitally based advertising and marketing communications tool that many companies rely on, as they can be tailored to specific content relatively easy and have a high rate of return (Pauwels, Weiss, 2008). Banner ads have over time become more personalized and tailored through clickstream analysis to the unique interests of a website visitor (Pauwels, Weiss, 2008).

This digitally based approach to targeted has proven to be significantly more effective than direct mail campaigns, which often have a 6 -- 7% response rate, and are considered highly successful if they attain that (Spilker-Attig, Brettel, 2010). E-mail is often used as the follow -- up to a prospect clicking on a banner ad, often including a call to action to the prospect for additional information or to place an order for a product.

Comparability speaking, the direct mail piece would generate the interest, the call to action would be an 800 number, and the telemarketer would respond to the prospect. This would put more reliance on the prospect to respond. With digitally based advertising and marketing communications channels, the response rates are typically higher than 6 -- 7% as it just takes a click of a mouse to get opt-in to proceed with a sales cycle (Pauwels, Weiss, 2008).

Due to the speed of online advertising and marketing communication, and the high level of traceability it provides in terms of digitizing all activity, many marketers have favored these methods globally. Marketing Sherpa, a marketing consultancy firm recently published an analysis of these channels (Marketing Sherpa, 2011). Their analysis indicates that marketers will increase spending on websites by 64%, search engine optimization (SEO) by 62%, social media, 53$ and e-mail by 53% throughout 2011.