Analysing Existing Trends of Space Selling
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If an ad is created and placed in the media, the costs of creation and time or space in the media must be paid for. This is a major area in which advertising departs from public relations. Advertising doesn't have that problem. If time or space is bought in the media, the ads (as long as they follow the guidelines set down for good taste, legal products and services, etc.) will appear. The drawback is that ads are clearly designed to extol the virtues of products and companies, and any ad is perceived by consumers as at least partly puffery. There are two basic ways to sell anything: personally and non-personally. Personal selling requires the seller and the buyer to get together. There are advantages and disadvantages to this. The first advantage is time: the seller has time to discuss in detail everything about the product. The buyer has time to ask questions, get answers, and examine evidence for or against purchase. A second advantage of personal selling is that the seller can see them. Finally, the seller can easily locate potential buyers. If they enter a store, they probably have an interest in something that store sells. Street vendors and door-to-door sellers can simply shout at possibilities, like the Hyde Park vendors who call out. From there on they fit their message to the individual customer, taking all the time a customer is willing to give them. From the above, it appears that personal selling is much better than advertising, which is non-personal. This is true. Advertising has none of the advantages of personal selling: there is very little time in which to present the sales message, there is no way to know just who the customer is or how she is responding to the message, the message cannot be changed in mid-course to suit the customer's reactions.
Products, services or ideas are the things that advertisers want consumers to buy (in the case of ideas, "buy" means accept or agree with as well as lay out hard, cold cash). However, there is more involved in products or services than simply items for purchase.
A product is not merely its function. It is actually a bundle of values, what the product means to the consumer. That bundle may contain the product's function, but also the social, psychological, economic or whatever other values are important to the consumer.
Chapter 1: Introduction
In an era when physical tail space is still at a premium, constrained by planning restrictions and rising costs, productive use of space is a key indicator of buying and merchandising success, and high space productivity depends on offering the right range, in a logical layout, with products available and easy for the customer to find. Decisions about how much space to devote to each product line and its location in the store play an important role in the pursuit of merchandising success. The aim of this chapter is to provide an insight into this process.
1.1 Space selling management:
Space selling constraint applies to all retailers, but in non-store retailing the constraints are different. A mail order retailer, for example, has page space and the number of pages in a publication as constraining factors, whilst a TV shopping channel needs to break down the airtime to different products. However, internet retailing offers great opportunities for adding space without much additional resource input. The main constraint on the amount of space used in a virtual outlet is the customer's attention span. In spite of this additional freedom, the objectives of space allocation are essentially the same no matter which retail format is used.
The management of retail space is concerned with a number of key objectives. The first is to optimize both short-term and long term returns on the investment cost of retail pace. The second is to provide a logical, convenient and inspiring interface between the product range and the customer. This can be particularly important in a large store, where customers can quite easily become overwhelmed and lost. Another objective is to make sure that the right selection of products is available; that products fit into the retail space and that stock-outs are avoided. Choice for the customer is maximized when the best selection for them is put into the available space. Space allocation aim has an important role to play in communicating the retail brand, When ice is managed centrally it helps a chain of retail outlets to achieve visual consistency, so that customers arc reassured by the similarity of the store layout and shelf appearance.
1.2 The Space Management Process:
A retailer goes through a number of stages when allocating space to products. These four stages will they used as a framework for the Inclusion of discussion topics within this chapter.
Measuring Space Selling:
Although space in a store outlet is three dimensional, retail space is often measured in square, rather than cubic units, Square units arc appropriate where, for example in fashion retailing, a variety of single tier fixtures stand on the shop Iloor (see FigureS. I). Many fixtures, however, arc multilevel and so more appropriate ways of measuring space to allocate might be on the basis of linear or cubic footage (see Figures 8.2 and 8.3). Measurements of space that are more specific to individual retailers might be useful, such as the number of pages to be published in a catalogue or the total number of fixtures available in an outlet.
The two principal measures of retail success arc sales and profits. Sales volume and profitability can also he measured in relation to the amount of space used to generate those levels of sales and profits. This can then be compared with the level of financial investment in that space. The resulting measures express the productivity of retail space. Sales (or profits) per square meter is a commonly used measure of retail space productivity, which is an important concept in the evaluation of retail product management performance.
Dividing the space into selling areas:
At this stage, space management is concerned with allocating space to different product areas, defined according to individual retail businesses, but usually on the basis of product (department or category. The amount of space will he determined to a greater extent on previous performance indicators, typically sales values. However, sonic products, because of their physical characteristics may need disproportionate amounts of space in relation to sales. In a department store, home furnishings may need a relatively large amount of space to generate a good level of sales because the products are bulky, a large variety of merchandise is needed for customers to choose from and a lot of display space is needed to do the product justice. On the other hand, jewellery is a high value product category that needs relatively small amounts of space for display and selling purposes. The stage a product category is at in its life cycle is likely to influence the space allocation at this level. If a category is growing, then more space should be allocated, whereas a declining category needs to have its space rationalizes.
Measuring selling space using square metres
Using linear measurement for space selling
Using cubic measurement for space selling
Typical €˜hotspots' In a Space selling
Particularly evident in department stores, where specialist products such as furniture and home entertainment, as well as hairdressing salons and customer service department's located on basement or upper floors, Customer flow can also be encouraged by locating high demand items throughout the store layout, with plenty of impulse items located in between. Retailers need to find a balance between maximizing sales of high demand products, generating flow around slower selling products (which may have higher profit margins), and providing logic and convenience in the layout for the customer,
A logical route through the different product categories or departments is part of a customer focused offer, and can encourage linked sales. For example, in a baby equipment retailer like Mother cares it makes sense for merchandise to be grouped into themes for space planning purposes. These product themes are then presented in a logical way to the customer as they move through the store. Products for immediate needs, such as feeding and general baby care come first, followed by bath time and clothes; and then on to the more expensive, one purchases in the travel and nursery departments.
The barbecue season provides a good opportunity for retailers to generate interest and sell distinctive groups of complementary products. Some of these products are strictly seasonal: the barbecues themselves and the briquettes for example. However, other products can be given additional space allocations in the seasonal aisle as part of the €˜barbecue category'. Firelighters, matches, marinades, sauces, disposable tableware and beer are products that are found around the supermarket throughout the year, but are given a boost In the barbecue season by being merchandised as complementary goods.
It is estimated that guests take an average equivalent of eight drinks when they are Invited to a barbecue, and €˜studies (bulk packed small bottles of beer) are particularly popular for barbecues as they are easy to handle, €˜women friendly', and easily chilled. Whilst the majority of barbecue beer is bulk purchased In advance from supermarkets, and then chilled down at home, convenience store retailers are often used for guests to buy drinks en route, and so providing chilled beer becomes important for this type of retail format.
Allocation space to individual product:
Having made a plan for the layout of departments or categories within the retail outlet, the next stage is to make a decision about exactly how individual product lines should be displayed within the outlet, whether the product is going to sit on a fixture, or be represented by a photograph within a page spread. Various approaches to space allocation are discussed, for example by using sales or profits as a guideline, some practical challenges arc considered, and the relationship between category management and space allocation is explored in this section.
Allocating space on the basis of sale:
The guiding principle here is the more a product sells, the more space it should be given. Retaining a high stock service level will depend on retailers ensuring that they devote enough space to a high demand product, such as milk, to prevent replenishment of that item becoming inefficient and inconvenient to the customer. A fast selling item however may not be one that a retailer makes much profit on (again milk is a good example), and so they may decide to allocate more space to their profitable lines. In taking this approach, however, the retailer is likely to encounter the problem of not devoting enough space to fast moving lines, so a balance has to be achieved. Another decision that has to be made is which €˜sales' figure should he used for the allocation exercise, Alternatives are historical sales figures (for that outlet); market share figures; or projected sales figures.
Store A is a branch of clothing retailer XYZ in a medium sized town centre. Ten miles away there Is a regional shopping centre where branch B Is located and twelve miles In the opposite direction, branch store C Is located In the heart of a city centre shopping complex. The policy of retailer XYZ is to offer a returns policy In all of its stores for products bought in any outlet nationwide (including those purchased from its web site). Shoppers from the town where store A is located, often take shopping trips to the neighboring centres, where B and C are located, especially if they are wanting to make a major purchase such as a coat or a suit, and require a wide choice of retail stores to select from. Unfortunately for store A, any unwanted products usually end up being returned to the customer's local store. This has the effect of distorting the sales figures for store A, upon which space allocation decisions are made. Unfortunately, the retailer's information system does not recognize the difference between a returned garment from the original store and one returned from a different outlet. In order to counteract this problem, which can be quite widespread, a retailer would need to allocate space on the basis of estimated sales rather than historical sales.
Allocating space according to a measure of sales assumes that there a relationship between the amount of space and the rate of sales, this relationship is termed the space elasticity of a product and it refers to the extent to which the sales of a product will change in response to a changed. In the amount of space allocated to that product Research suggests that space elasticity not uniform amongst products, or across stores or departmental locations.
Using profit measures as a basis for space allocation ill prevent a business manager from allocating large amounts of best quality retail space to unprofitable products. They could mean, however, that a retailer was allocating unnecessarily large amounts of space to products that would sell as well with a smaller space. Profitable lines may not in fact sell very quickly at all, and allocating extra facings or shelves of the product may have very little impact on the sales of the product. In this case the quality of the space becomes important, so the retailer can locate high profit items in locations around the stare that arc better selling. The relationship between the sales and generated by different products, and suggests how space and ranging decisions should be made accordingly. Allocating space according to sales, and in particular, product profitability, is working with the interests of the retailer, and not the customer in mind and therefore may suggest an illogical and presentation of products. Long term profitability depends on customer loyalty, which is dependent (among many other things) upon being satisfied with the presentation and assortment of products. Fine tuning the allocation of space within a retail outlet therefore requires extensive amounts of high quality data, together with a pragmatic and customer orientated managerial approach at store level.
Productivity and efficiency and towards are visual display improvements. Once an optimum level of efficiency is achieved, space planners can move onto the objective of making their products and fixtures more attractive than their competitors. Some of the latest planning systems are able to simulate the entire store environment, so that the product manager can view an attractive plan in virtual reality and make any adjustments they fed are necessary. Recent space optimization technology applications offer the opportunity to create specific platform.
Space Allocation and Category Management:
Although the performance of individual product lines is Important to retailers in terms of the rate of sales which influences availability and the levels of contribution to turnover and profitability, the focus of performance In many' retail organizations is at product category, rather than individual SKU level. A retailer is more interested in overall levels of sales and profits generated by their product range, rather than the sales of a single line that might be of interest to its manufacturer. The product category has emerged as a manageable classification for most aspects of product management, and certainly applies in the case of space management. In fact, many would argue that space planning and allocation and the systems that drive the process can only be properly implemented in tandem with a category management approach.
Category management seeks to optimize the depth and variety of a product assortment within a specified amount of retail space and to generate maximum profitability by seeking efficiency in the operations that support the depth and variety. This includes replenishing to guarantee availability' and adding new products and running promotions to generate customer interest and increase short term sales of particular products, without harming the overall profitability of the category. Space allocation systems allow (Inc tuning of a category assortment, provide the means by which product and category performance can be monitored and analyzed. and by using the programme output the plans can he easily communicated and successfully implemented within the various retail out lets. In some categories key brands are dominant, in which case their presence needs to have immediate impact within the space allocation plan. Other categories are very competitive, in which case low price, budget own brand and promotional products strongly on the promotional. Many businesses use the principle that shoppers will a category from bottom to top, and left to right, and so well-known brands arc placed on middle and lower shelves on the left of the category space in order to provide strong cues to the customer. Premium products meanwhile are placed on high level shelves, selecting their high quality positioning, and the fact that the customer for premium products will seek out the better quality product within the category. In some categories the customer decision-making processes are quite unique and nerd to he fully reflected within space allocation plans. For example, the decision sequence for wine is generally as follows:
Colour ------ Country of origin -------- Price Level ------- Brand
Whereas the decision sequence for yoghurt might be:
Natural or flavored --------- type (low fat, standard or luxury) ---- Price Level ----- Brand Name
These decision processes should determine how products arc displayed within the category space.
In certain modes, if the product is maintained in the offer, long-term customer satisfaction will be retained In spite of the Individual poor product performance. Therefore it is the store's personality traits that determine the core product ranges, and not the size; the size of the outlet determines the width and depth of the selling type that would appeal to the local customers, Stores are empowered with the merchandise that allows them to drive local market opportunities and local suppliers can also be involved in the process of providing tailored products for individual store needs, As retailers offer more formats from which customers may choose to shop, format preferences and product preferences can be matched, For example, Tesco found that its online shoppers tended to from more affluent backgrounds, and so the on-line product offer is tailored accordingly, with a large range of wines and few value lines,
For many small retailers the cost of a computerized space planning is prohibitive, and so many rely on basic sales and profit margin analysis combined with trial and error in space allocation decision making.
A great deal of space selling is carried out in order to achieve relatively short-term retail objectives, such as maximizing the benefits of a product or departmental promotion, meeting seasonal sales figures, or improving branch profitability. However, the long term strategic objectives of the retailer provide the framework within which these decisions are taken. Space allocations must be in line with the overall positioning strategy of the retailer; the variety and depth of assortment and the stock availability service level should not be compromised by the need for short-term productivity gains. In addition, the arrangement of products around the store needs to be considered in the light of the contribution that product items, brands and categories make to the positioning statement, it may be necessary to over-represent new products or to allocate extra space to growing or seasonal categories in order to reinforce an innovative product positioning strategy. The local customer profile may also lead to exceptional space allocations in an effort to meet individuals' requirements more closely. However, the retailer's space is the extent of its empire, and every inch of that space must be used to its maximum effect even if, as we shall see in the next two chapters, some space is designed to he devoid of products. The measurement of that effect, however, must be appropriate in terms of the overall aims for that space.
Chapter 2: Literature Review
Space selling refers to space available for advertising in different media. The advertising media available are print, electronic & outdoor. The space available and intend for advertising in different media. Decision about how much space to devote to each product line and its location plays an important role in the pursuit of merchandising success. The aim of this thesis is to have an insight into this process. First will have to understand that the services of every publication/channel, costs of space selling. The ads featured in it. And a space seller to sell that advertising space/time to potential advertisers.
2.1 UCPL acquires marketing and space-selling rights for Lemon TV and Jhankar TV:
K Sera Sera's recently launched free-to-air channels -- music channel Lemon TV, and Hindi movie channel Jhankar TV -- have appointed Universal Communication Pvt. Ltd (UCPL) for their marketing and space-selling rights. UCPL is a player in the space of airtime selling and marketing of serials, television programmes and feature films for various television networks in India. Jhankar TV will particularly target the Hindi speaking audience. This is a channel that would reach to the audience of cable and satellite in UP, Bihar, MP and Rajasthan. On the other hand, for Lemon TV, they are planning to have different kinds of event and programmes like Lemon party. This will bring in more interactivity too with the relevant TG.' When asked about the marketing challenges for these new channels, 'Every new channel in India right now faces the challenges of clutter and telling the advertiser what difference does this channel bring to the table, and what is the value addition. These channels are also in the same situation and we are confident about overcoming these challenges.' UCPL is associated with media and advertising agencies like Mindshare, Mediaedge:cia, Madison, McCann Erickson, Lintas, etc., and with clients like Hindustan Unilever, Procter & Gamble, and Godrej, among others. As a company, UCPL has now diversified into full-fledged events and brand promotions, striving to create and mange innovative concepts, thus offering their client complete 360-degree solutions.'
2.2 Using the blogging concept to sell wikis:
If a person understands what a blog is, the wiki may be compared and contrasted to a blog. A blog enables a single person to get a message out. A wiki enables a group of persons to assemble a body of knowledge. A wiki can be presented as a blog with one major post (the purpose, topic, idea of the wiki) that others can build knowledge around, without the initiating post getting buried in archives as new posts arrive and are displayed in reverse chronological order.
A wiki may be sold as a horizontal blog platform. Blogs are vertical, recent updates on top, all others shoved down into oblivion, with only tags, categorical sidebar listings, or site search to dredge them up again. But a wiki distributes all the information in a more horizontal, flat, single surface that stretches through pages spread out, not sedimented. The wiki may be sold as a web site set up for idea construction; it is team-architected rather than single-authored. Blogs tend to be univocal and identifiable; one known person expounding a position, with audience members invited to comment on the sermonizing, but not really authorized to begin their own topic threads. Wikis are multimodal and transiently anonymous, many unknown people working together. A wiki, thus is like a super-democratized blog. A blog where the walls between bloggers are audience is dissolved. The audience members become the contributing authors and the originating authors become the audience, and vice versa.
2.3 Modern Trends in Working Styles:
Another interesting way of presenting wikis has to do with the fact that they allow for easy remote working. One of the main advantages a wiki provides is the fact that it is available from any internet-connected web browser, at any time. Information can be worked on efficiently in an asynchronous manner. In this regard, wikis solve tricky coordination problems.
What's more, a wiki provides a virtual space where all relevant business information can be stored. Hence people working from different places, at different times of the day can still end up with a coherent document. A wiki is more efficient than e-mail for the resulting document can almost be exploited immediately and its last version is "always on top" (which is quite useful when working with more then one person).
2.4 The Advantages of Asynchronous Communication:
Wiki content growth and increasing value in an organization by facilitating asynchronous communication which is often more convenient than other forms of collaboration that require "face time" or "same time". On the other extreme, making large batches of content (Power Point, White Papers) are inefficient simply because they require the author to provide context and content, some of which may be error laden or out-of-date. Wikis allow smaller batches of contribution to appear at any time, thus relieving two bottlenecks to collaboration. Add to this the fact that they are completely auditable for contribution, and the need for creating "credit" concurrently is removed.
2.5 ROI on social software:
Being able to make a business case will be very important to all convince for every enterprises and after than to make a start on adopting social software. Charlene Li has a contribution about ROI on blogging. But Return on investment has to be calculated for all sorts of social software.
Then again, ROI is becoming increasingly irrelevant when online collaboration tools and social media platforms are available for free, or at extremely low cost. Many companies find they can get along just fine with the free versions of blogs (lBlogger), podcasting (Odeo), video uploading and player embeds (YouTube), and wikis (Socialtext).
ROT (return on time) is the far more challenging aspect of social software. It takes a significant investment in time to become known in the blogosphere, for example. Bloggers must spend large amounts of time in researching topics, writing posts, linking to other Blogs, interacting with comment posters, reading other Blogs, posting comments at other Blogs, producing multimedia content, emailing other bloggers, and adding features and functionalities to a blog. All this in addition to remaining informed about ones industry or field of study.
Warning top management about falling behind in competitive technology should be sufficient to begin a case for online collaboration tools. Explaining that the trends are massively aligned, user-generated content, customer co-creation of product, corporate contributions to innovation, and universal content utopia, advocates of social software and user media can point to great examples of Peer Pioneers companies leading the way: P&G, IBM/Linux, Second Life, Digg, Jigsaw, YouTube, and InnoCentive.
2.6 Successful Strategies for Selling Ad Space on Low-Traffic Websites:
Upon first thinking about it, the idea of selling advertising on a website or blog with limited traffic seems a bit daft. After all, aren't most advertisers interested in putting their product in front of the highest number of eyeballs possible? Approaching them with piddly visitor numbers seems like a surefire way to end up in the deleted folder.
But though it may feel like putting the cart before the horse, there are many good reasons and ways to sell ad space on low-traffic websites. What you need to always keep in mind is that, while advertisers are drawn to high traffic numbers, they desire something else even more: high conversion rates. There are plenty of success stories of websites that have limited traffic but sell a ton of advertising. These websites succeed because they do one thing well: they deliver the right type of customer to the right type of business.
Space selling concept:
* Take a close look at your website - Whether they sell landscape or skyscraper ads, text ads, video or any other format, they have to offer something of value before you can start to sell advertising space. They know this sound obvious, but it always surprises them how many publishers and online media owners come up with a niche product that nobody wants to buy advertising space in! If they are going to make a fortune in selling subscriptions or other membership related offerings, then fine - but in most cases, forget about their hobby or leisure interest, unless it is unique and offers a great angle. Do make sure their product is going to be attractive to a large enough audience before they attempt to sell advertising - and if they have a fair bit of competition, make sure that they have some unique selling points and formats. As they move into Web 2.0 the requirements from a lot of advertisers will change. If they can offer a new format or idea and take the hard work out of it for the advertiser, they are onto a winner. If they don't, they'll lose out to their rivals.
* Choosing ad formats that will sell - Not all ad formats sell well on ALL websites. Put another way, some ads work better on consumer websites than they do on business sites - and visa versa. The trick is to test their ads with different messages, fonts, colours and designs. This research will be well worth it in the end and can make the difference between making a decent revenue stream and making a substantial one. One of the biggest things to bear in mind is where the advertising should be placed. If they sell products on their site, there is very little point displaying adverts, which could detract potential customers away from their own sales message. So, the first thing they need to do is highlight the sections and pages where they are happy to accept advertising. When they have done that, they can then take a look at design and placement. Always think of the customer when you think about designs, placements and tracking. Make it simple for advertisers to find and relate to the formats, as they will have to justify the ad spend to their bosses.
* Reporting and statistics - This is a vital part of their business! Remember, communication is the key to long-term success. If they don't have a good reporting and stats package in place, then they will find it difficult to show their customers what they are/could be getting from their services. This can take a bit of time to set up, but it really is worth the time and money they put into it. Once in place, it can be automated to match their business model and to provide an essential package for their existing and potential customers. Remember out of sight, out of mind - leave it to their competitors to make this mistake!
* What are their competitors doing well? - Even if they are offering a good service, they bet there is something they can learn from their competition. Some media companies do have the luxury of having someone who acts as a researcher into profitable markets and who also takes a closer look at the competition. However, this is usually the exception to the rule, so they'll probably have to give this task to someone who is already well versed on their current ad-sales set up. Always look at their competition closely - see what they are offering and what is unique to them. If they make a list of what they offer, they can probably pick a few holes, when it comes to handling objections and answering questions from potential advertisers. They can bet they are picking holes in them! More importantly, learn from what they are doing well and improve on it in their current platform.
* Finding the best ad-sales people - In an age when a lot of talented ad-sales people are setting up their own freelance businesses, there are two main options available to them. Do they go for the traditional route of finding a suitable sales person on a permanent level, or do they look for someone who may be willing to work on a commission only or part time basis, through an outside company or agency? Whichever one they choose, there are certain things to look out for when choosing someone who can sell for them. How many hours per day do they need someone to sell for them? What kind of experience does the potential candidate have? How do they sound? 4. How do they look? 5. What drives them? Finding good people is tough - getting them to sell for them is even tougher. However, if they are a freelancer and work on commission only, they need to sell to earn. If they find good people and make it easy for them, they should be able to hang onto them for a long time.
* Google ad-sense - generating revenue from your website - Google ad-sense is one of the many success stories from Google. It enables publishers to make revenue from displaying adverts on their website. All ads are within the Google network and all it takes is for them to paste a bit of code onto their pages. The ads will then be displayed and you get paid whenever anyone clicks on an advert. The system requires them to do some testing, in terms of design and click through effectiveness, but once they have found a format that works; it can create a substantial revenue stream for them. They can choose from text only, line ads or video. Make sure them look at the overall format and structure before they decide on a plan and always test first!
2.7 Selling Web Advertising Space:
The next big Internet race might turn the buying and selling of advertising space on Web sites into the online equivalent of the pork-bellies pit. Over the past few years, a host of small companies has started electronic exchanges where advertisers and Web sites can buy and sell online advertising space. The companies, with names like Right Media Inc., AdECN Inc., Turn Inc. and ContextWeb Inc., have been an obscure sideshow to a broader battle over Internet advertising. That's changing quickly. The biggest Internet companies, including Microsoft Corp., Google Inc. and Yahoo Inc., are focusing attention and money on the emerging business, hoping to be first with the kind of large-scale, dynamic market for the ad industry that the Nasdaq market brought to stocks. Over time there will be "a handful of winners that build very high-tech marketplaces. "That's what we're trying to do; that's what Google is trying to do."
Today, online publications and Internet companies have space for display ads built into their Web sites. Typically, that space gets filled with ads either the old-fashioned way through a salesperson or by a mix of computers and people called an ad network that automatically sells ads for the spot. But a significant portion of the available ad space called "inventory" remains unsold, or is sold for next to nothing. Enter the exchanges, which use automated systems to match buyers with sellers of unsold space.
With ad exchanges, member advertisers specify the price they're willing to pay for a certain type of ad spot, such as a banner ad that will be viewed by a female in Boston. When a woman in Boston pulls up a Web page of an exchange member with banner slot available, software assesses the exchange's offer. If the price offered is better than the site's minimum rate for that page and higher than what it can get from other sources, such as ads sold by its sales staff, the site will usually accept the exchange-brokered offer. The exchange's computers can then deliver the winning ad to be displayed as the Web page loads on the consumer's PC. The exchange immediately notifies the site if it doesn't have a buyer for the ad space, and the site can then put in a nonpaying house ad or try other means to unload it on the fly.
It can complete an auction for the ads on a Web page in 12 milliseconds after a consumer clicks to pull it up. AdECN runs an exchange where 28 advertising networks, which purchase ad slots from many different sites and sell them at higher rates to advertisers, buy and sell ads. Exchanges usually collect payments for ads and pass them along to the sites, taking a commission. Ads are generally priced per thousand times they're viewed by consumers, a unit known in the industry as CPM. Online ticket seller StubHub in recent months started using exchanges and ad networks to spread its reach to sports and music fans on the Web. (Historically, the company used ads tied to Internet search results on Google to reach customers.) The exchanges have allowed StubHub to place ads on a broader universe of sites large and small that it never had used before. Some of those, including ads on Gawker, a gossip blog, and Internet radio station Accuradio, led to ticket sales, StubHub executives say.
In a few months of use, ad networks and exchanges "has already become material to their marketing mix. He estimates the company now spends about 15% of its budget (up from zero at the beginning of the year) for display ads over networks and exchanges. There's still some disagreement over the actual differences between networks and exchanges. But many industry executives agree that transparent pricing and an open neutral marketplace where anyone can buy or sell ads are distinguishing characteristics of exchanges.
Q Interactive of Chicago this month started selling some ads on its sites through the Right Media exchange. And it believes that buying ads on other sites through the exchange, which it has begun doing as well, will offer a 20% to 30% better return on investment than its previous practice of going around and buying ads from different sites individually. "Right now if you want to do a media buy you have to buy on a lot of different networks and with a lot of different publishers," says Q Interactive CEO Matt Wise. "Theoretically, with an exchange, one technology platform can cover an enormous swath of the Internet."
Or so the big players hope. Yahoo thrust exchanges into the spotlight in April when it agreed to pay $680 million for the remaining 80% of Right Media, following a 20% stake it bought last October. Yahoo said that it wanted to own Right Media as a way to take a leadership role in promoting the exchange model. The company has been selling some ad space on its site through Right Media, and says it has seen increases of over 50% in prices for ad spaces sold through Right Media compared with what it brought in for them on its own.
The Right Media acquisition followed Google's $3.1 billion deal to purchase DoubleClick Inc., which is building an ad exchange. DoubleClick last week began conducting transactions for actual ads on the exchange it has been building. David Rosenblatt, chief executive of Double-Click, estimates exchanges could eventually handle 50% of all display ad sales. He compares the exchanges to auctions that Internet search providers like Google used to ignite search-related advertising several years ago. "They think the exchange concept will have the same impact on the display market
Meanwhile, Microsoft has started developing a prototype of an exchange and has also considered buying one of the start-ups, say people familiar with the company. Microsoft General Manager Joe Doran declined to give details but said Microsoft has been studying the exchange model and "what it would take to build an exchange." But, he said, "it's still very early for the exchange concept to really catch on and drive to large scale."
Indeed, if the dream is to have the same kind of impact on advertising that spot markets had on commodities and stock markets on equities, one or more exchanges will need a critical mass of buyers and sellers. As with stock markets, "liquidity" is key for the ad exchanges: the more participants, the greater the chance of finding buyers and sellers.
But with a bevy of exchanges large and small, the industry risks not having a critical mass of buyers and sellers on any one exchange to make a viable market. "That's the thing that's uncertain," says analyst Greg Sterling of Sterling Market Intelligence in Oakland, Calif.
It's also unclear what percentage of their ads Web sites will be willing to sell through exchanges. Many industry executives say the exchanges are suited only for "remnant," or leftover ads and ad space that the biggest brands aren't interested in. Big advertisers generally want to have more control over where the online ads appear and who sees them.
With exchanges, "the underlying assumption to that is you're buying a commoditized product that anyone can sell you," says Steven Kaufman, senior vice president at Publicis Group SA's Digitas interactive agency. Many of the high-end ads that Digitas handles require human negotiation and tailoring before appearing on a Web site. "That's not coming through an exchange," he says.
Others disagree. Such high-end ads represent at most 10% of the ad market, counters AdECN CEO Bill Urschel. "And everything else is up for an exchange."
2.8 Some practical challenges involved in space planning and allocation:
* A method for displaying information on an electronic billboard, comprising the steps of: providing a first electronic billboard at a first location; coupling a first information handling system to the first electronic billboard so that the first information handling system can control information to be displayed on the first electronic billboard; providing a second electronic billboard at a second location; coupling a second information handling system to the second electronic billboard so that the second information handling system can control information to be displayed on the second electronic billboard; coupling the first and second information handling systems to a third information handling system over the Internet; selecting, via the third information handling system, which of the first and second electronic billboards will display the information; uploading the information from the third information handling system over the Internet to the information handling system controlling the selected electronic billboard; and displaying the information on the selected electronic billboard, wherein the selected electronic billboard is selected from a list of available electronic billboards which includes the first and second electronic billboards, wherein the list includes a map of the first and second locations.
* A method as recited in claim 1, wherein the map is displayed on the third information handling system.
* A system for displaying information on an electronic billboard, comprising: means for providing a first electronic billboard at a first location; means for coupling a first information handling system to the first electronic billboard so that the first information handling system can control information to be displayed on the first electronic billboard; means for providing a second electronic billboard at a second location; means for coupling a second information handling system to the second electronic billboard so that the second information handling system can control information to be displayed on the second electronic billboard; means for coupling the first and second information handling systems to a third information handling system over the Internet; means for selecting, via the third information handling system, which of the first and second electronic billboards will display the information; means for uploading the information from the third information handling system over the Internet to the information handling system controlling the selected electronic billboard; and means for displaying the information on the selected electronic billboard, wherein the selected electronic billboard is selected from a list of available electronic billboards which includes the first and second electronic billboards, wherein the list includes a map of the first and second locations.
* A system for displaying information on an electronic billboard, comprising: means for providing a first electronic billboard at a first location; means for coupling a first information handling system to the first electronic billboard so that the first information handling system can control information to be displayed on the first electronic billboard; means for providing a second electronic billboard at a second location; means for coupling a second information handling system to the second electronic billboard so that the second information handling system can control information to be displayed on the second electronic billboard; means for coupling the first and second information handling systems to a third information handling system over the Internet; means for selecting, via the third information handling system, which of the first and second electronic billboards will display the information; means for uploading the information from the third information handling system over the Internet to the information handling system controlling the selected electronic billboard; means for displaying the information on the selected electronic billboard; and means for charging an amount of money for the display of the information on the selected electronic billboard, wherein the selected electronic billboard is selected from a list of available electronic billboards which includes the first and second electronic billboards, wherein the list includes a map of the first and second locations.
* A method of advertising, comprising the steps of: uploading advertising data to an ebillboard.net server via a remote computer by an advertiser; uploading additional information concerning the advertiser via the remote computer by the advertiser at the advertiser's option; transmitting the advertising data from the ebillboard.net server to a selected billboard; transmitting the optional additional information concerning the advertiser from the ebillboard.net server to a web site dedicated to the selected billboard; displaying on the selected billboard the advertising information at a selected time.
* Wherein a consumer viewing the selected billboard is informed of the availability of additional information concerning the advertiser at the web site dedicated to the selected billboard.
* A computer program product adaptable for storage on a computer readable medium, the computer program product operable for displaying information on an electronic display, comprising the program steps of: receiving over a first network first information and a designation of a first target display; and sending the first information over a second network to the first designated target display, wherein the first information is accompanied with a time when the first information is to be displayed on the first designated target display, and wherein the second network is the Internet.
* A computer program product adaptable for storage on a computer readable medium, the computer program product operable for displaying information on an electronic display, comprising the program steps of: receiving over a first network first information and a designation of a first target display; and sending the first information over a second network to the first designated target display, wherein the first information is accompanied with a time when the first information is to be displayed on the first designated target display, and wherein the first and second networks are part of the Internet.
* A computer program product adaptable for storage on a computer readable medium, the computer program product operable for displaying information on an electronic display, comprising the program steps of: receiving over a first network first information and a designation of a first target display; and sending the first information over a second network to the first designated target display, wherein the first information is accompanied with a time when the first information is to be displayed on the first designated target display, wherein the first designated target display is selected from one of a plurality of target displays to which the first information could be designated, and wherein the first and second networks are part of the Internet.
* The computer program product as recited in claim 9, further comprising the program steps of: receiving over the first network second information and a designation of a second target display; and sending the second information over the second network to the second designated target display.
* Wherein in the receiving step the first information is accompanied with a designation of a second target display, and further comprising the program step of sending the first information over the second network to the second designated target display.
· A space selling program product adaptable for storage on a computer readable medium, the computer program product operable for uploading content to an electronic display, comprising the program steps of: receiving content; receiving a designation of a target display device to display the content; and receiving a designation of a time that the target display device is to display the content, wherein the second receiving program step further comprises the program steps of: outputting information on whether the target display device is available to display the content; permitting a selection of the target display device if it is available to display the content; and preventing a selection of the target display device if it is not available to display the content.
· A space selling adaptable for storage on a computer readable medium, the computer program product operable for uploading content to an electronic display, comprising the program steps of: receiving content; receiving a designation of a target display device to display the content; and receiving a designation of a time that the target display device is to display the content, wherein the third receiving program step further comprises the steps of: outputting information on date and time availability of the target display device to display the content; permitting a selection of the target display device at a selected date and time if the target display device is available to display the content at the selected date and time; and preventing a selection of the target display device at the selected date and time if the target display device is not available to display the content at the selected date and time
2.9 Sell Print Newspaper Advertising Space:
Selling print newspaper advertising space is a fairly complex task. Before yet picking up the phone to pitch ad space to prospective advertisers, they have to make sure their ad sales method is decisively in place. The design of the classified part needs to be easily passable for readers. The price structure must be crystal clear for their potential advertisers. They are supposed to have a promotional plan ready for directing readers from other parts of their newspaper to the classifieds. Finally, they should be able to secure a balanced stream of ad sales leads and follow them to the ends of the earth. Read on to find out how to sell print newspaper advertising.
* Design their print newspaper classified advertising section. It must be simple to read, easy to understand, and consistent. There is nothing poorer than a classified ad segment that is all jumbled among too many display ads. Reside true to the "classified" portion of their classifieds. For instance, list everything under caption like Auto, Real-Estate, intended for Sale, and so on. Comprise subheadings while necessary. Moreover contains advertising rate details and your contact information's, as a result that potential advertisers can make contact with their sales team.
* Create the price sheet meant for classified ads in your print publication. The prices should be simple to understand. For instance, be obvious about whether they should charge by the character, word or line. Propose clear concession on selected ad packages purchase in bulk. State whether they will assist them to really arrange the ad, along with any other value-added services they offer when advertisers go through their print newspaper. Later on, insert testimonials with the rate sheet, since the rate sheet operates as a form of advertising for people to advertise through them.
* Get a steady stream of sales leads. They can obtain prospective advertisers' contact details from competing newspapers which is well-known as "raiding the competition". The directories like Yellow Pages, or somewhere else. Be innovative, and come up with at least a few hundred leads before starting their telesales program.
* Telemarket their print classified advertising services. Use their sales leads and telephone all leads one at a time to pitch ad space. Keep it conversational.
* Explain the benefits of advertising with them, and elucidate on the drawbacks of not advertising with them. Keep it short and simple.
* If someone agrees to buy classified ad space in their print publication, up-sell them. To do this, they can offer discounts on bulk advertising. Sell ads in bundles over a period of time, or offer to place two or more differing ads in the same issue of the newspaper.
* Have the advertiser pay by credit card, and do not run the ad until payment is received. They may have to stand your ground on this point. Remain polite.
* Constantly prospect to regenerate their classified ad sales lead list. Make sure you have a bottomless pool of leads from which their sales team can draw.
* Manage their sales team by tracking their progress. Use quotas as mile markers by which to measure performance. Make sure everyone is dialing at least a dozen times a day, talking with at least 20 prospects, and successfully closing at least five sales. On slow days, they must dial 120 times a day, talk to at least 10 prospects, and make at least three sales. Keep their sales team pumped up and happy. Don't be a jerk. Just be tough.
* Help their advertisers by participating in the ad composition process. Make headlines extremely clear and place them under appropriate headings. The body of the classified ad should clearly explain what is being advertised, along with the contact information so that readers can actually take action and purchase the product or service.
* Track the effectiveness of their print classified advertising section. To do this, tell their readers to tell their advertisers that they found them in their publication. Print this prominently throughout their classified section. That way, they will get repeat clients. Remember, it is far easier to keep a client than to get one.
* Stay creative, and always strive to improve the sales and effectiveness of their classified advertising section.
2.10 Objective behind Selling Advertising Space:
Would observe the company that delivers the daily paper to their doorstep for a business case study, they will come to learn that the newspaper publisher hires reporters, writers and other important staff to create the contents and deliver the papers to their readers. In addition to the above mention, the publisher has to invest regularly in heavy duty machineries and tons of papers in printing tons of newspapers on a daily basis. And in order to ensure that the newspapers are delivered on time, the publisher appoints agents at every part of the covered territory. So, how does the newspaper company make money? It is obvious that selling a copy of the papers at less than a dollar would not even be able to even fund the operations. Selling advertising spaces! They have definitely seen lots of advertisements in the newspaper. The publisher simply sells advertising space in the papers to advertisers who want to leverage their advertising efforts on the paper's high readership. On the same analogy, they can make money the exact way from their newsletter: simply by selling advertising space to prospective advertisers! If their mailing list size exceeds 1,000 (5,000 is recommended) subscribers and beyond, they can start selling advertising space for say, $10.00 per sponsor ad. In this manner, they turn every issue you send out to their subscribers into a profit-pulling device. And since there is virtually no end to the stream of advertisers as products, services and businesses are cropping every single day in every industry imaginable, so is their money making opportunities
2.11 Brand building works differently:
Direct marketing aims to get people to make an immediate purchase. In contrast, brand building advertising campaigns assume that potential customers may or may not respond immediately - and may take weeks or months to come to a decision. They look forward to delayed responses of a positive kind. With most product advertising, it is impractical to expect immediate purchase. People don't buy cars, computers, air conditioners TV sets, or even garments, every day. What brand-building advertising does is to try and plant the brand message into people's subconscious so that it increases the chances of their selecting the brand when they are actually ready to buy. Also, people are not spurred to purchase actions by one ad or one ad campaign. They are also influenced by rival ads, their brand recall, and the price and features that these rival brands offer the consumer. Advertising aims to create and strengthen key brand perceptions about the advertiser's products over a period of time so that when the consumer is ready to purchase, the brand is among those that are short-listed for the final consideration.
The final test of any advertising is how much sales it has generated. Very few
Indian companies do systematic research into the efficacy of their advertising - including press and TV advertising. Most are happy with impressions like 'their sales picked up after they started their advertising.' If they have done a campaign across various media and also used point-of-sale promotions, they are not sure which of these investments paid off best. So, when they think of the effectiveness of online advertising, consider this. Online (or offline) advertising should generate additional sales (or maintain Advertisers have also become more aggressive and innovative in their online campaigns as users realize they can only get free information if it is subsidized by advertising. They now find - pop ups, flash animations, interactive banners, €˜superstitious' (TV-style ads that pop up and play 20 second animation or video) and larger-format ads that they cannot miss. This, in turn, has made previously reluctant advertising agencies more willing to support online advertising. That's because they can charge more for the new-style ads than they could for static banners. In the US, for example, the average banner ad costs less than $10,000 to create, compared with $340,000 for the average TV spot. The higher cost of the latest media banners makes them more viable for ad agencies to get involved. There is another trend that is contributing to the growing acceptability of online advertising. Advertisers have realised that online ad campaigns cannot remain static, and must refine, refresh and change their ads frequently in order to retain visitor interest. This too means better volumes for ad agencies.
2.12 Principles of Space Advertising through media:
In advertising the term media refers to communication vehicles such as newspapers, magazines, radio, television, billboards, direct mail, and the Internet. Advertisers' use media to convey commercial messages to their target audiences, and the media depend to different degrees on advertising revenues to cover the cost of their operations. In 2001, U.S. advertising expenditure in media was estimated at $233.7 billon, of which television accounted for 22.5 percent, direct mail 19.8 percent, newspapers 19.3 percent, radio 7.7 percent, yellow pages 5.8 percent, magazines 4.7 percent and the Internet 1.8 percent, with other media accounting for the remainder.
The media are usually classified into either mass or niche media. Newspapers, magazines, television and radio are considered mass media because they deliver messages to a widespread, anonymous audience. There were 1,483 daily U.S. newspapers in 2000, with total circulation of 47.2 million on weekdays and 59.9 million on Sundays. In September 2001, the five largest U.S. newspapers were USA Today, The Wall Street Journal, The New York Times, the Los Angeles Times, and The Washington Post. There were 3,188 consumer and farm magazines, with paid circulation of 399 million. In the beginning of 2000, there were 1,248 commercial television stations and 10,220 commercial radio stations in the U.S. The wide coverage of the mass media makes them ideal vehicles for advertisers who need to reach a large audience. Advertising media such as cable television and direct mail are often viewed as "niche" media because they reach a narrowly defined audience with unique demographic characteristics or special interests. With 54 or more cable channels available in 62.1 percent of U.S. wired cable subscriber households in 2000, for example, audiences can tune in to CNN for continuous coverage of events around the world, to Home & Garden TV for information on home improvement, or to Cartoon Network for children's programming. Direct mail, the second largest advertising medium in the U.S. in 2001, offers more flexibility in terms of precision targeting and content customization. Direct mail can be used to reach almost every consumer with personalized messages.
The Internet has emerged as a medium for marketing and advertising since 1994. The Internet is different from conventional advertising media in several respects. First, it can serve as not only a communications channel but also a transaction and distribution channel. Consumers can get information and make purchases and payments all through the Internet. No other medium can accomplish these marketing functions instantly, without resorting to other means. Second, the Internet is by nature interactive. Users can initiate a shopping process by visiting a Web site and then clicking on hyper-linked text for more information. It is a two-way communication, with the Internet serving as a provider of customized content that meets an individual's needs. Third, it has the capacity for multimedia content. It can carry not
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