Online Advertising: Advantages & Benefits

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  • 0:04 What Is Online Advertising?
  • 1:05 Online Advertising Advantages
  • 4:49 Lesson Summary
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Lesson Transcript
Instructor: Danielle Reed

Danielle works in digital marketing and advertising. She holds a bachelor's degree in English and an MBA.

Both service- and product-based businesses can benefit from online advertising. In this lesson, you will learn about the benefits and advantages of online advertising.

What Is Online Advertising?

Are you still not leveraging online ads for your company? The advantages and benefits of online advertising are only increasing as more and more customers move online for their purchases and information. Thus, both service and product-based businesses should be participating in online advertising.

Online advertising is the promoting or marketing of messages to consumers using the internet. Online ads can be found on platforms such as Facebook, Instagram, Google, individual online sites, and more. They generally involve both a marketer and a publisher.

The most popular types of online ads include display, web banner, social media, mobile, email, text, and search engine marketing or pay-per-click. Since about 65% of people click on Google ads when they're looking to buy an item online, product-based businesses should be running online ads. Likewise, over three quarters of local-mobile searches result in offline purchases. Brick-and-mortar and service businesses should therefore also be performing online advertising.

Online Advertising Advantages

Let's now take a closer look at some of the advantages and benefits to online advertising one at a time.

1. Choose Your Target Audience

Perhaps the greatest advantage of online advertising is the ability to target a very specific segment of people. A target audience is a particular group of consumers you aim your ads towards. Because data is collected about online users, it's simple to use ads to serve a specific audience. For example, Facebook allows you to make online advertising selections based on geographical location, interests, gender, age range, education level, and/or job title. If your ideal customer is an engaged woman in Atlanta, Georgia, Facebook can serve ads to that exact customer segment.

2. Know Your Analytics

Have you spent money on an ad and waited for customers to come in through the door? Even if your printed ad was the reason someone visited you, it would be impossible to know unless an employee followed through to ask. With online advertising, you have analytics which give you the metrics right at your fingertips. Some of the most informative and commonly available key performance indicators, measurable values you use to evaluate success, include:

  • Number of impressions, which is the number of times your ad is displayed, or shown on the web.
  • Cost per click, which is the amount of dollars you paid to achieve one click on your ad campaign.
  • Ad reach, which is the number of unique people who saw your ad.
  • Click-through rate, which is the number of clicks generated by an ad impression. It's listed as a percentage.
  • Conversion rate, which is the percentage of visits that result in the desired action (i.e., a purchase, a paper download, a signup, or an email opt-in).

3. Flexibility of Ad Types

It's typical for magazine or newspaper ads to include agreements of up to several months in length. Online advertising, on the other hand, doesn't restrict you to one specific ad type, so you don't need to make a long commitment to a campaign. With online ads, you can change your spending at the click of a button and switch platforms at your convenience.

4. Reaching Customers Where They Are

While there's certainly value in print advertisements, online advertising is the way to reach your customers if your target audience is online. According to Google, YouTube reaches more 18+ year-olds on mobile during primetime TV hours than any cable TV network. Online platforms are therefore simply where your customer base likely happens to be.

5. Spend Less Money

In a direct cost comparison, Lyfe Marketing found that the advertising dollars you need to reach 1,000 people on various media channels were as follows:

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