Ed Healy

Q1 2009 was abysmal, as far as online advertising revenues were concerned. Have things changed?

I didn’t wake up one day and decide to be an advertising salesman. I certainly never expected to run ads for a network of sites. No, my expansion into the world of online advertising was by chance. When someone waves a large chunk of money in your face and asks you to take it, you don’t say No. You find out how to earn it.

That was how I started. An advertiser wanted to place ads on the Kobold Quarterly website – more ads than I could handle. I didn’t want to turn down the money, so I had to find sites to put those ads on. That’s how it’s been ever since. My expansions come when I outsell my inventory. Necessity is the mother of expansion, at least in my case.

The first nine months went well. The average effective CPM (eCPM) across all the site in my network was $2.00 – and that includes wasting 30%-50% of our inventory on AdSense. Come the New Year, though, it was a new game. Nobody – at least nobody I was talking to – was buying ads. Our eCPM dropped to $0.50 and I was not happy; neither were the owners of the websites I represent.

Since late April, though, there’s been an explosion in advertising. This month, 87% of the impressions on my sites are sold, and we’re looking at $2.50 average eCPM. No warning came, only requests for advertising space.

So what’s changed? Will the online advertising market continue to weaken, or will marketing budgets recover soon, and with them the size and frequency of online advertising purchases.

I don’t know.

It’s a fun industry, though. If I ever figure out the whys, behind the whats, I’ll let you know. In the meantime:

(1) If you use online advertising services, which do you use?

(2) How’d your average eCPM change recently?

(3) How do you diversify to guard against sudden network failure in a commodity market.

“A picture is worth a thousand words.” If that’s true, then your advertisement’s illustration has an enormous amount of influence over the reader. If your illustrations support your product’s brand and encourage readers to buy what you’re selling, then they are doing their job. If, however, your illustrations repel the reader, or give a negative image for your brand, they are actively working against you.

Here are a few ways to make sure your illustrations are working for you, and not against:

(1) A great artist or photographer is only as good as the subject matter. You must have a compelling idea with which to grab the reader’s attention. Before trying to spec out an artist for your advertisement, spend a good amount of time refining the idea behind your advertising message.

(2) Few gaming publishers use photographs in their advertisements. This is unfortunate, since photographs attract more readers than illustrations—three times more.

(3) Keep your illustrations simple. Crowded scenes don’t pull the reader’s attention as well as those containing one central figure.

(4) Four color advertisements cost 50 per cent more, on average, than black-and-white. However, they are 100 per cent more memorable to readers.

(5) Illustrations with “story appeal,” elements that arouse the reader’s curiosity, are more successful at grabbing a reader’s attention. If you don’t have a story to tell, it’s best to focus on your product; make it the subject of your illustration.

Your advertisement’s headline is the most effective tool, the most important element that will determine how effective your campaign is. Never advertise without a headline.

“On the average, five times as many people read the headlines as read the body copy. It follows that unless your headline sells your product, you have wasted 90 per cent of your money.”
– David Ogilvy, On Advertising

Include your product’s name in the headline. If you don’t, 80 per cent of readers (who never get past the headline itself) will never know what product you are advertising.

The best headlines promise the reader something—nostalgia, quicker play, lots of action. What are you promising your customers? Communicate this promise, somehow, in your headline.

If you have news to tell, place it in the headline so that customers will read it, don’t bury in the body of the ad where it will go unnoticed. Headlines with news in them are 20% more likely to garner a response from customers. If you have a new product to release, this is prime news and you should place that information in your headline.

Certain words engender consistent responses from readers. Introducing tells your reader that your product is something new and entices them to read on so they can learn more about it. Now has a sense of immediacy about it, focusing the reader’s attention on your headline and drawing their attention to the message you are trying to convey. They appear regularly in advertising for a reason: they work.

Write plainly. Puns and double meanings may show how agile your intellect is, but they are counter-productive. Your advertisement has to compete with a host of other content for the reader’s attention. Broadcast what you want to say in language that is easy to understand.

The magic number of words in a headline is ten. Anything longer and the readers are unable to digest what you are trying to tell them.

If you want to read more about writing headlines, pick up a copy of Tested Advertising Methods by John Caples.

One of the most important elements of an advertising campaign is the mechanism you establish for measuring its effectiveness—what you do to make sure you known how well the advertisement translates into sales.

Ad campaigns do not operate in a vacuum. Customers will hear about your product from other sources; they will read about it on your website, see it in the catalogues of online retailers, read comments from other customers on gaming forums, and thumb through it at their local gaming store. You need a mechanism for segregating your advertising effectiveness from the influence of these other sources of information.

Customers love promotions and special discounts. Even a marginal reduction in price can be a powerful incentive to induce customers to buy your product. This is also a great way to gauge the effectiveness of your ad campaign.

Establish a unique promotional code customers can use when purchasing your product from an online store. Only place this promotional code in your advertisements, and in no other place, so as not to dilute the value of the feedback you will get from related sales. This is probably the best method when using print advertisements, such as in magazines or direct mailings.

If you don’t have the ability to create promotional codes, create a separate product page in your online store dedicated to the promotion. Place the URL to this special page in your advertisement, but no other place. This way you’ll know that sales generated from that page are the direct result of your advertising campaign.

Special URLs are a must when using online ads. You need to know which purchases are the result of a customer clicking on that banner. If you are placing multiple banners on different websites, or on different sections of a given website, create a different target URL for each placement. This will tell you which placements are performing the best. You can always aggregate the sales from each later on, to give you a picture of the overall effectiveness of the campaign.

Direct mailings or magazine inserts are also useful for measuring an advertisement’s effectiveness. The number of returned cards will give you a direct read on your customer base. These methods also allow you to ask for a small amount of personal information from your customers, so don’t pass up the chance. At the least, you’ll be able to build a database of names and addresses of people interested in your products—prime targets for future offerings.

Another advantage of direct mailings and magazine inserts is that customers could use them as coupons at their local gaming retailer. I am not familiar with any recent attempts, within the gaming industry, to use coupons on the retail level. It is something to consider, however, and I would be very interested in hearing from publishers who have tried this approach.