This summer, two men who once served in the Israeli army sat in a
Hammersmith pub and revealed their plans for a revolution. On their
laptop, and in the slim plastic folder they pushed obligingly across the
table, were the details of a plot they insisted would overturn an entire
The two men were the founders of an Israel-based company called
Their revolutionary idea was a system called iNotes, which they believed
would kill off the banner ad. Before forming their company, the men had
served in the Israeli army’s technology unit. Only in the weird world of
the internet could two former soldiers claim to have invented a new
Using messages that traverse users’ screens at regular intervals, rather
than waiting to be clicked on like banners, iNotes is highly intrusive
and, says iWeb CEO Kobi Samboursky, highly effective.
Such initiatives play on fears that internet users are beginning to
ignore banners. According to some sources, clickthrough rates are
falling and as a result so is the amount of cash advertisers are
spending on banners.
But online sales professionals assert that, while new ideas are welcome,
they are unlikely to kill off the banner in the near future. A recent
study by Price-waterhouseCoopers found that banners still account for 53
per cent of adspend on the net, with sponsorship taking 30 per cent and
more experimental methods sweeping up the remainder.
’Banners are certainly not dead,’ states Tanya Pein, former managing
director of online sales house 24/7 Media UK. ’The market is growing at
a dramatic pace and they’re becoming more cost-effective and more
They are as popular with advertisers who have been online for years as
they are with those who are going on to the web for the first time this
Peter Wilson, TSMSi’s sales manager, confirms: ’There’s plenty of life
in the banner yet. I’d be pretty concerned if a client came to me and
said ’I want to be online, but I don’t want to use banners at all’. If
you place them on the right sites and target the right users, they can
still be enormously effective.’
But he agrees that banners themselves are now more alluring. ’Old-style
banners were flat and unanimated. If you still see examples like that,
it’s usually a combination of an agency which doesn’t understand the
medium, and a knee-jerk reaction from a client thinking ’I’d better go
online, so I’ll just slap up a banner’.’
Ian Maude, head of advertising at AOL UK, suggests sales people remain
keen on banners because they are convenient. ’They are universal,
they’re portable, they’re standardised and they are easy to measure. And
if you have the right product message, the right creative and the right
placement, they are also extremely effective. Thomas Cook (an AOL
client) gets a 20 per cent clickthrough rate on its banners.’
Clients that are new to online advertising are particularly likely to
opt for banners over more complex solutions. Anna Barez, sales director
Europe at search engine Lycos, comments: ’In many cases, agencies are
still trying to educate clients about the internet. First they have to
convince them to use the net in the first place. Then they have to
explain banners. If they then start suggesting there’s something even
newer than banners, they may have a problem on their hands.’
Having said that, net-savvy advertisers are undoubtedly looking for more
sophisticated means of reaching users.
Lycos offers a number of what might be termed ’next generation’
These include video banners, which incorporate digital versions of
advertisers’ TV spots. When users click on the banner, they see a replay
of the advertiser’s TV campaign. According to Barez, clients such as
British Gas and Peugeot attracted 50 per cent more users to their
banners when they employed this device.
Video, audio and animation online are known as rich media, and there are
a number of software companies providing this kind of technology to
advertisers. High-profile names include Macro-media, Unicast and
Brian White, media services director at Real Media, another online sales
house, devotes almost all his time to exploring online advertising
techniques that go beyond the banner. ’In September, 40 per cent of the
campaigns we ran used rich media as opposed to traditional banner
advertising,’ he says.
Rival sales house DoubleClick has seen a similar escalation of
Sponsorship director Stella Fairbairn says: ’Banners are now so
ubiquitous that people are attracted to the thrill of the new. There’s
no doubt that experiments can pay off. We have seen response rates go up
by as much as 300 per cent.’
Typical examples include interstitials - advertisements that appear
unexpectedly on content pages - although these have been known to annoy
users because they take too long to load and slow down the surfing
process. More recently, Unicast unveiled the ’superstitial’, which loads
separately from web pages and only appears when it is ready to be
Unicast is convinced superstitials have the brand-building potential of
TV commercials. Film companies have successfully used them to build
awareness of movies like The Mummy and Austin Powers: The Spy Who
’It’s possible to achieve an astronomical amount of brand recognition
using rich media,’ says White. ’Movies are one of the obvious
applications because the creative is already available. For other
products, you have to come up with new material, just as you do with TV
campaigns. I can see a time when there will be advertising agencies
specifically devoted to creating rich-media online campaigns.’
Some website publishers are suspicious of rich-media ads because, unlike
traditional banners, they often take up a full page and mask site
But forward-looking marketers and creative agencies are extremely
positive about them.
’It’s easy to see why,’ comments Maude. ’After all, you have a lot more
space to be creative. You can’t have a banner ad directed by Ridley
From an effectiveness point of view, Maude says it is impossible to
generalise about the merits of rich-media techniques over banners.
’There’s no way you can say, ’banners are great’ or ’banners are shit’.
You have to look at each client and its objectives. But it’s important
that some kind of experimentation goes on, because that’s how the medium
History (if the internet can claim such a thing) suggests that it will
develop rapidly. When clients first heard about the web, they rushed to
set up their own sites. Most have since dismantled them, realising that
a static web page promoting a soft drink is likely to bore users.
Marketers now prefer to advertise on existing sites.
Banner ads themselves have evolved. At first they were different sizes,
so clients found it hard to advertise on more than one site. Realising
they were missing out on advertising dollars, online publishers quickly
It’s likely that the future of online advertising lies beyond the
internet as we know it. 24/7 and DoubleClick are already exploring the
potential of Wireless Application Protocol (WAP), which allows users to
access web content through mobile phones, palmtops and pagers.
Advertisers will also be able to send messages.
E-mail commercials are also growing in popularity with clients, despite
the danger that they could irritate users. A possible way round this has
been devised by US company Megachain, which awards commission to users
who agree to recommend goods and services to their friends and
The theory is that recipients are more likely to click on an ad
forwarded by a pal.
John Haswell, an investment analyst at Greenchip Investments, which will
run Megachain when it launches here in the new year, is convinced
banners are on their way out. ’There’s a lot of evidence to suggest the
sheer volume of banner advertising is annoying net users. Banners are
still not very targeted and are often seen as irrelevant. Banner
advertising is dead on its feet.’
The truth is that the banner will be with us for some time yet, but only
as one of many advertising options. One thing is for sure - the internet
is rapidly becoming as cluttered as every other medium, and advertisers
will have to work harder to stand out from the crowd.
The standard advertising format on the web - a strip at the top or in
the margin of a web page enabling users to click through to the
advertiser’s site. Hence ’clickthrough rate’, used to measure
effectiveness. Page impressions, referring to the number of users who
merely see the banner, are also becoming a popular measure - some say
this is because clickthrough rates have slumped.
Key word advertising
When a user types certain words, the advertiser’s banner appears on the
page. Some search engines will sell the names of competing companies -
eg. the word ’Barclays’ to Lloyds.
The electronic equivalent of direct marketing. Increasingly cited as the
most likely contender for stealing the banner’s crown. Opt-in referral
e-mail - giving users commission for sending e-mail ads to their friends
and relatives - has been developed as a way of encouraging recipients to
Combines audio, video and graphics to create near-TV quality ads. Can be
used within banners. The downside is it takes up a lot of bandwidth (the
capacity for moving images and data) so ads take longer to download.
Intrusive, often full-page ads that appear unexpectedly on web pages.
Unpopular with users because of the lengthy downloading process - and
similarly with media owners because they cover site content.
Similar to interstitials, but they do not become visible to the user
until they have finished downloading, so do not interrupt surfing. Some
web experts believe they could become the next industry standard.
Wireless Application Protocol. Allows users of mobile phones, palm-tops
and pagers to check web content while on the move - and also receive
messages from advertisers.