AOL Advertising Sales Manager Gary Sherwood Addresses Local Erie Advertisers

The much anticipated Erie Ad Club new members’ luncheon took place today at the Erie Club, with a very large turnout. The 70 seats that had originally been reserved looked to have increased quite a bit, creating a buzz of anticipation and excitement in the meeting room. Soon after the attendees had helped themselves to a lunch spread of salad, sandwiches, soups, and cookies, Gary Sherwood, Advertising Sales Manager of AOL Media Services, was introduced and took the mic.

His comprehensive presentation consisted of a broad overview of the current state of the online advertising market in comparison to past years and other advertising and marketing mediums that are being utilized by advertisers and marketers. Sherwood began with consumer behaviors and what they mean for companies. The first characteristic of internet users was identified as the idea of multi-tasking. The amount of available consumer media in our world has exploded in the past years with the growth of recent technologies. Despite this growth, there remains only 24 hours in a day to try to consume all of this information and entertainment. This has resulted in a general tendency to multi task, and the use of technology to compress content and time. Time, in the online space, is all relative.

An example Sherwood cited was TiVo, “Who would have thought five years ago that one hour of television could be watched within 40 minutes, or a three hour football game could be watched within a half hour?”

Sherwood continued by outlining four factors that are driving this multi-tasking activity in users:

1. Broadband as mainstream

2. Searching

3. Limitless distribution channels and the vast amount of user generated content.

4. Online video streaming.

One hundred and seventy six million people are online in the US today, and more than 50% of them have access to broadband internet from their own homes. This broadband becoming a mainstream, and in some cases a necessity, has led to a change in users’ online habits, spending more time on the internet, and more likely to become creators and distributors of the content itself.

Users who go to the internet to look for a certain company, location, or information about a topic, stop first at a search engine. There are 6.4 billion monthly searches on the Google search engine alone. This search feature is a way of organizing online behavior, which can be greatly utilized by advertisers seeking prospects through search marketing. This solution is available to all levels of companies, even those who do not have a large marketing budget, because a max spending amount per month can be set, and companies only pay when their links are clicked.

The streaming of video streams in 1999 was about one billion. In contrast, the estimated amount of video streams in 2007 will be 35 billion. As you can see, the popularity of video streaming has exploded, and includes users viewing television shows, movies, selected clips, popular advertisements, or random videos on sites such as YouTube.

Online advertising facilitates a one to one, interactive relationship from the first step of awareness all the way through to the transaction. It allows companies and their customers to engage in a unique dialogue that other mediums can not compete with. It is also measurable in real time. Companies can track clicks, which pages of a web site the user clicked through to, how much time they spent on the page, and many other factors almost immediately.

Gary Sherwood concluded his presentation by summarizing his presentation with the comment that the online world is the ultimate on demand user format, where the consumers are in control of the content. When they log online, they are either looking for something that will make their life easier at that moment, or communication with the online community.

At this point in the luncheon, Sherwood opened it up for questions about online advertising in general. An extremely interesting question, in my opinion, was asked about the potential of social networking sites as marketing or advertising venues. Sherwood replied that he did not know the specifics of that medium and how it works, but he stated his personal opinion about what should be done, if in fact is not being carried out already. Users of these social networking sites, such as Facebook or MySpace, usually enter massive amounts of personal information about themselves, including particular interests, occupations, geographical location, etc. The social networking sites themselves could then used this self-proclaimed information to segment these individuals into different “buckets.” This way, those who are interested in sports would see narrowly segmented sports advertisements when logged into the site.

I, personally, know that Facebook does something similar to this. Advertisers can choose to reach only those individuals that are in certain “networks,” or geographical areas. To some extent, Sherwood’s opinion on the ideal way to advertise on social networking sites is already being implemented. However, it seems that advertisers should be able to segment even more, leading to more of that interactive one to one relationship we discussed before.

Another interesting topic brought up in the Q&A was the idea of websites “remembering” your information to make it easier for users to fill out forms, initiate transactions, etc, as well as to help the website’s company to appeal to you. For example, Amazon’s website recommends different products that you may be interested in based on the selections it “remembered” you either looked at or purchased. Sherwood explained that these websites work by tracking the IP addresses, which are unique for every computer. The site “cookies” the user every time he or she browses the website or clicks a link. The site will “remember” the actions taken by that computer in order to appeal more to the users.

This presentation was an extremely good overview of e-marketing. However, there are numerous aspects that weren’t touched on, simply because of the short nature of the luncheon. However, we would like for you to continue the dialogue about these different types of media being used for marketing. What do you think about the potential of social networking sites as a marketing medium? Does “cookie-ing” an individual invade their privacy? What about blogging or podcasting? Are these media appropriate for marketing?