Why online advertising may not be the best solution for small and home businesses.
At the Jupiter Communications Online Advertising conference Aug. 18, 1999, Scott Heiferman, CEO of i-traffic, an online direct marketing agency, asked “Haven’t people learned to tune out banners?” He went on to say the “banners suck for most marketers,” and challenged marketers to offer suggestions for alternatives to banner advertising at a web site specially set up to gather marketers’ thoughts. (See the end of this article for a link to that web site.)
But, do banners really suck? Are they as ineffectual as Heiferman claims? Are they any less effective than last year? And is using banner advertising a wise idea for small businesses like yours? Here’s what we found out in a recent survey of small business owners conducted here at our BusinessKnowHow.com web site.
The good news (at least for those who use banners to advertise and those who rely on banner advertising revenue to help support sites) is that slightly over one-third of the small and homebased business owners who took our survey listed banner ads as one of the methods they use to find web sites. Additionally, our survey showed that banners ranked about the same this year as they did in a similar survey we conducted last year.
The bad news (you new that was coming, right) is that banner advertising isn’t the best way to get attention from small and home businesses. In fact, it only ranked sixth out of nine possible choices.
How SOHO businesses use the web
The survey asked visitors to the Business Know-How web site to indicate how they use the web and what was most likely to get them to visit a web site. Results from 107 respondents who completed our multiple choice survey show the top five uses of the web for SOHO businesses are:
- email 93%
- research 88%
- finding suppliers 65%
- attracting customers 50%
- getting customer support 50%
- placing orders for supplies 36%
Interestingly while 65% of our respondents use the web to find suppliers, only 36% actually order supplies over the Internet.
How SOHO businesses find web sites
According to our results small and home business owners most often find web sites as a result of searches, text links and referrals. Although 35.5 percent did say banners helped them find web sites of interest, ads on radio and TV and links in lists of links on web pages were slightly more effective than banner ads at getting them to visit a web site. Least effective to our visitors were ads appearing on editorial content pages they read.
The actual percentages were as follows:
- Searches 68%
- Text link 61%
- Referral 53%
- Ad on TV or radio 39%
- Link in a list of links 36.4%
- Banner advertisement 35.5%
- Newsgroup 29%
- Product review 26%
- Ad on edtorial page 19%
The bottom line?
Our survey was taken by a relatively small number of SOHO business owners who happened to find it on our web site. For statistical accuracy, a formal survey addressing a broader, random audience would need to be conducted. However, based on the experience of the 107 individuals who took our survey, approximately 1/3 of SOHO businesses do find their way to web sites as a result of banners ads they have seen. Thus, it would appear that businesses that can afford major advertising campaigns reaching millions of people may, indeed, benefit from banner advertising. Small businesses with limited funds for advertising may do better, however, to focus their efforts on finding ways to get text links placed in articles, newsletters or other documents their potential customers read online. Additionally they should look for appropriate web sites with which to trade links and spend time fine-tuning their pages so they are found by search engines.