26 March 2014

Which is Better-TV Advertising or Online Advertising?

TV advertising is a traditional way of advertising and has been prevalent since the popularity of television sets. It is generally accepted as the most powerful advertising medium. It has been a very effective mode of communication for promoting products and brands by various companies worldwide. With the rising acceptability of online advertising due to low cost and targeted reach, the worthiness of TV advertising has become questionable from cost-benefit analysis.

image: SOMMAI, freedigitalphotos.net

Although TV advertising is considered to be one of the most expensive tools used for communications but it reaches a broad spectrum of consumers at low cost per exposure. Moreover, it has much wider reach compared to online advertising. In India there are about 153 million TV owning households out of total 234 million households according to a research by TAM. But the large volume of non-programming material on television creates muddle and consumers ignore or forget ads. There are wars for getting the advertising slots during programmes having high TRP. The impact of TV advertising is not easy to be measured in quantitative terms, so the metric is related to success in brand building in the form of brand awareness and knowledge among the masses. The frequency of ad should be high to have effortless recognition and recall by target market.

Online advertising can be in various forms like websites, search ads, banner ads, social media marketing etc. Through the use of cookies consumers’ tastes and preferences can be known and can be tracked through page views, unique visits and length of visits. Search ads account for roughly half of all online ad spending. These ads appear above or next to the search results, depending on the amount a company bids and ads’ relevance to a particular search. Banner ads are small boxes containing text and a picture placed on relevant websites for which companies pay. In the early days of internet, viewers clicked on 2-3% of the banner ads but that percentage has plummeted to .25% presently. The active population on social media is youth who spend extravagantly. This is the main reason for the increasing focus of companies on social media campaigns.

Online advertising is relatively cheaper but it has limited reach as internet penetration in India is just around 12%. The penetration is far less in rural areas of the country. It is suitable for promotion of products or services among the specific target market. For instance MBA colleges go for banner ads on MBA discussion portals (Pagalguy, TestFunda, etc) used by students preparing for B-school entrance exams. The impact of online advertising can be easily measured by click through rates and sales generated. It is more interactive and customer focused than TV advertising. It is safe to experiment and change messages online.

Social media marketing which is the most popular form of online advertising nowadays offers many advantages. It offers the benefit of focused targeting. Ads are displayed after thorough analysis of people’s online behaviour and interests. It even has the facility to put an ad on or off in case a person visits the ad related website. This technique of displaying relevant ads is not considered as intrusive or annoying and moreover a company do not need to waste money and resources on trying to reach wrong audience. By the use of social plug-ins on a website curiosity is created among potential customers by providing them information about their friends’ activities on the same website. The in-depth analysis of online behaviour can serve as a source of feedback for business. Social media is cost effective source of promotion for businesses. It transcends to temporal and location limitations of existing distribution channels. Compared to other means of advertisement it can provide greater amount of information and in lesser time. One of the cons of managing social media effectively is that it requires a lot of efforts and time. Additionally it can be fatal for any company if something goes wrong in the planning or execution of social media strategy as negative news diffuse at rocket fast speed on social media. Social media makes business vulnerable to negative publicity as users are free to post or comment whatever they like.

In the present scenario where consumers differ subtly on the basis of demographics and psychographics, there is no one winner between the two forms of advertising. There have been examples of companies going for online advertising in addition to TV advertising and vice-versa. Flipkart is an e-commerce venture that is spending on TV advertising to increase its visibility and sales. The selection of the type of advertising is a crucial decision and needs to be evaluated on a lot of factors like reach, frequency, impact, objective (brand building or customer satisfaction), outlay and target market.

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