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Pop-up's pop-off point
Study says consumers don't need to see the same Web ad 50 times. Cut it down to five.
April 9, 2004: 10:20 AM EDT
By Parija Bhatnagar, CNN/Money staff writer

NEW YORK (CNN/Money) - Internet advertisers take note: You don't need to hawk your wares with a zillion pop-up ads when really just five or six are enough, according to a new industry report.

"People are seeing as many as 50 of the same ads in one day. This doesn't really work and it's not good use of advertising dollars," said Young-Bean Song, director of analytics for advertising technology company Atlas DMT.

The study of 38 online advertisers showed that the odds of converting someone into a buyer of a product or service are typically the highest after they see a fresh online ad for the first time.

But the best overall conversion rate is after five or six exposures. "After that, there's an precipitous decline in the effectiveness of the ad," said Song. "It would make sense for advertisers and online publishers to put a 'frequency cap' on ads."

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He gave an example: "For example, Yahoo can cap each ad on its Web site at five impressions. That means that the same person won't see the same ad more than five times," said Song.

"Internet users will see a greater variety of ads in a given day and advertisers will spend money more efficiently," said Song. "This is also a way for online content publishers to distinguish themselves from the competition."

Industry observers say advertisers love pop-ups and banner ads because of the low costs, usually a few dollars, to put online. That's why they're ubiquitous.

In fact, advertisers launched just over six billion pop-up and pop-under ads -- or about 7 percent of all online ads -- in February, according to Nielsen/NetRatings. Total U.S online ad spending in 2003 was $6.3 billion, up 10 percent from the year before.

At the same time, consumers are showing that they've had enough of a "terminal" ad invasion everytime they surf the Web. Industry watchers say websites have reported that anywhere from 5 to 23 percent of the Internet's population already uses pop-up blockers.

Said Nate Elliott, analyst with Jupiter Research, "Currently 45 percent of leading Web sites accept pop-up ads, while 65 percent accept pop-unders. But we've noticed that number is shrinking. It's the annoyance factor. More people say they're annoyed with pop-ups than with spam."

"When you ask marketers about the pop-up ads, they say slyly that they are very effective. My response to that is Tony Soprano's methods are effective," quipped one industry observer who did not want to be identified, referring to the mobster character of a popular TV series. "Would you use them, too?"

Meanwhile, the Internet Advertising Bureau (IAB) is soon to release its own recommended guidelines for pop-up advertising.

Said spokesman Stu Ginsberg, "The report is tentatively scheduled for next month. However, this is not an 'official' industry standard. These are only suggested guidelines that we're recommending to advertisers."  Top of page




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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.