Howard Rosenbaum
(To whom correspondence should be sent)
Main Library 012
Bloomington, Indiana 47405-1801
Internet: hrosenba@indiana.edu
Phone: 812.855.3250
Fax: 812.855.6166
1. Abstract"Advertising may be described as the science of arresting the human intelligence long enough to get money from it." (Leacock, 1982; 1)
"Advertising is the rattling of a stick inside a swill bucket." (Orwell, 1992; 501)
The growth and proliferation of the World Wide Web has been astounding during this decade; the number of sites continues to increase at an increasing rate. As the private sector has discovered the web, the ways in which the web is being used are beginning to change. Commercial ventures are becoming commonplace and many businesses, intrigued by the potential marketplace represented by the millions of users who are on the web each day, are experimenting with various forms of advertising. What happens when not-for-profit organizations begin to take advantage of this potential revenue stream? What kinds of issues will they face and what kinds of policies should they have in place before diving into the turbulent environment of the web? This paper begins with a discussion of advertising on the web and then examines the case of a educational institution that is selling advertising space on its web pages to commercial organizations. It examines the issues that have to be resolved before such activities can proceed and suggests a boilerplate policy for other institutions that may wish to explore similar avenues of publicity and revenue generation.
2. Introduction: About the World Wide Web
The Internet is approximately 27 years old. For most of its existence, it
has been a well-kept secret, its byways traveled primarily by the
knowledge elite; government scientists and researchers in the Department
of Defense, the Department of Energy, the National Science Foundation, and
in computer and the hard sciences. Towards the end of the last decade,
the Internet became a truly global network of networks and the subject of
much public attention and scrutiny. The development of the Gopher
software opened up the network to many people outside of the elite,
although Internet users were still found mainly in higher education and
government. The rise of commercial online service providers and the
opening of gateways to the Internet caused a great flood of new users and
signalled the end of an era; it also marked one of the most significant
instances of technology transfer in this century when the Internet,
originally created with tax dollars as a communications tool for the
highest levels of the military and the US Federal government, was
delivered into the hands and computers of the general public. Despite the
rapid growth brought on by these events, the explosion of the Internet was
detonated by the development of HTTP, or HyperText Transfer Protocol, the
software on which the World Wide Web (WWW) is based.
The WWW, developed in 1989, was released onto the Internet in 1991;
according to the W3 Consortium (World Wide Web Consortium, 1996):
The World Wide Web (WWW) is the universe of network-accessible
information, an embodiment of human knowledge. It is an initiative started
at CERN, now with many participants. It has a body of software, and a set
of protocols and conventions. The WWW uses hypertext and multimedia
techniques to make the web easy for anyone to roam, browse, and contribute
to.
As software developers have turned their attention to the WWW, a variety
of products are being released, many as freeware or shareware, which are
intended to further simplify the work of WWW document creation; HTML
editors remove the manual labor of marking up documents, imaging programs
reduce the effort needed to include graphic images in web pages, similar
products allow sound, animation and true multimedia to be incorporated
into WWW pages. There is also a growing set of easily available software
products that allow people to view WWW pages in their full color and
multimedia splendor. 1 As a consequence,
children in elementary schools are setting up WWW sites alongside
corporate giants. 2
Between 1993 and 1996, the number of WWW sites has increased from 130 to
an estimated 90,000 and, according to Gray, "the number of Web servers
soared to a point where one in every 270 machines on the Internet is a Web
server" (Gray, 1995). Estimates of Internet users with access to the WWW
range from 26.9 million (Matrix Information and Directory Services, Inc.
1996) to 48.7 million (Internet Solutions, 1996). As more Internet users
gain access to the WWW and discover the ease with which HTML can be used
to create WWW documents, people are creating hundreds of new WWW
documents, making their personal and/or organizational home pages part of
the interlocked networked information environment. This environment seems
to be evolving chaotically, and there are a number of efforts to classify
and organize the information on the WWW, some of which are funded,
organizationally supported research initiatives, and others of which are
powerful "search engines." 3
3. Advertising on the World Wide Web
The WWW is currently being used for a variety of purposes. At one
extreme, people create pages to serve as their personal fora of free
expression, culminating in the "Useless Web Pages" site. 4 There are pages that are used to provide a
variety of useful content, including government information at federal,
state, and local levels, academic information, ranging from electronic
journals to the delivery
of course content, and reference information, including online library
catalogs and collections of links to other WWW sites organized by subject.
There are pages that are ongoing and interactive works of art which
exploit the visual and textual capabilities of the WWW. At the other
extreme, there is business on the WWW. For example, there is a growing
number of publishers that are providing information about and selling
their publications. There are many companies that are conducting business
on the WWW, selling their wares in a variety of ways. 5
Electronic, Internet-based commerce is still in a nascent stage, however,
there are clear indications that there is a large consumer market to be
tapped, should two major problems be resolved. 6 The first significant problem to be
overcome is the development of secure means of supporting electronic
transactions involving credit card information and digital cash, which
will not be discussed in this paper (Working Group on Internet Advertising
1994). The second problem faced by people and
organizations coming onto the WWW is determining how to take advantage of
the capabilities of HTML and supporting software, or "helper
applications," to make their pages stand out from the crowd. This is the
problem of advertising 7 on the WWW and is
important for the estimated half of all WWW sites which are in commercial
domains (.com). Schwartz recently commented that if one spends time on
the WWW, one "will slowly discover that nothing less than an entirely new
publishing and advertising economy is taking shape in this man made (sic)
information- based terrain" (Schwartz, 1996) According to the Coalition
for Networked Information's Working Group on Advertising:
To achieve the goal of providing information, advertising itself must
change. Today's advertising tends not to be content rich...That is because
most advertising is geared for mass media, where only a small portion of
the audience is really interested in, or ready for, much information.
On the Internet, advertisers can provide "layers" of information, giving
netters as much data as they can wade through on a product or service.
That information is available immediately..., and can be as current as the
advertiser chooses to make it ...
Moreover, the information can be offered in ways that allow netters to
choose what to see, tailoring the material to their own needs and
interests...
There are two models that businesses and other organizations are pursuing
in the chase to gain what passes for market share on the WWW. Before
describing these models, two principles must be clarified about
advertising on the WWW because they seem to inform many of the advertising
practices currently being used. First, the directionality of the
advertising message has been reversed. In traditional advertising, the
message is imposed on the consumer, through mass marketing techniques
including mass media broadcasting of commercials and print advertisements,
telemarketing, and mass mailings.
The consumer is passive and is delivered over to the advertiser. On the
WWW, the consumer chooses to view an advertisement on a site and takes
actions to uncover the information the advertiser wishes to deliver;
Leonard calls this the "clickstream" and describes it as (Leonard, 1995):
The sum total of every point and click transpiring on the Internet, every
winding path traced by Web crawlers through a myriad of URLs. Figure out
how to measure the clickstream, argues conventional advertising wisdom,
and you're halfway to figuring out how to advertise on the Web.
What, then, are the models currently in use for advertising on the WWW?
One model is for a business or organization to be represented on the WWW
with their own site. They may set up their own WWW server and create and
maintain their WWW site in-house. They may also purchase the services of
an advertising/web design company that will create and maintain the
advertising pages on a remote server. In both cases, the emphasis of the
WWW site is singular and establishes the business or organization's
Internet presence as the sole occupant of the site. In line with the
principles mentioned above, some business and organizations will create
WWW pages that will be content heavy and only tangentially related to
their lines of business and which will contain links to their advertising
pages; this has been called a "hook page." 8 It is also increasingly common for
businesses to take advantage of the capabilities
of "forms," which are displayed on screen to allow users to input
information that is delivered to a database at the business' site and
stored for later use.
A second model involves the placement of advertisements on other WWW pages
belonging to other businesses and organizations. At a bare minimum, this
may be a single word on another page that is a hypertext link to the
business or organization's advertising or home pages. More typical is the
placement of an image or banner of varying size on the remote page; the
image contains the corporate logo and perhaps a tag line indicating that
the user can obtain some information or visit an interesting site by
clicking on the image. This type of advertising attempts to lead visitors
to the advertising or home pages who have gone to other sites for other
purposes; consequently, the placement and appearance of the image or
banner is of critical importance. The development of the Java programming
language and software such as Shockwave. 9, 10
4. Issues for not-for-profit organizations
The primary issue that not-for-profit (NFP) organizations must face is
whether they wish to become involved in the selling advertising space.
This involves answering two questions: is it necessary to generate revenue
through commercial activities? Is advertising the most appropriate means
to pursue this revenue stream? Selling NFP assets for commercial use may
bring the organization into competition with profit-making services which
could jeopardize the organization's not-for-profit status or create an
unfavorable appearance of selling public assets for the institution's gain
rather than for public use. The legal, managerial, and ethical
considerations of specific NFP decisions to advertise are beyond the scope
of this paper. The assumption is made here that the NFP has made the
decision to pursue advertising and this paper will consider the issues and
policies that should be addressed in order to effectively sell advertising
space.
Given the way in which NFPs are constrained in terms of their resources,
it is unlikely that they will be involved in the first advertising model
described above. They are not likely to become involved in selling
digital storage space to house the full WWW pages of businesses that wish
to advertise with them. The more likely scenario is the second model,
where the NFP sells space on its pages for the display of a banner or
image which links to the advertiser's pages. This is similar to the model
used by non-WWW based NFPs, such as National Public Radio, which briefly
describes sponsors but does not provide the detailed product information
one would normally expect in an advertisement.
The sale of Web advertising by the NFP places it in a situation analogous
to that of a traditional advertising vendor, such as a newspaper or a
television station. Consequently, there are three basic concerns for
discussion and investigation: media selection, pricing and production
issues, and acceptable use policies. These are concerns that are generic
to advertising; this paper will explore them as they pertain both to NFPs
and to the sale of web advertising space.
Media selection and the value of advertising
Price of the media is a major consideration to advertisers in media
selection. The setting of prices is a complex managerial task that
requires some knowledge of both the costs of providing the service and of
what the advertising market will bear. Such considerations are beyond the
scope of this article, but it is useful to potential WWW advertising
vendors to be aware of what factors in the medium influence price.
Specifically, this involves understanding how advertisers perceive the
worth of advertising.
Worth in this context refers to the perceived value of the advertising
received by the advertiser. Measurement of advertising value is can be
thought of as having two complimentary dimensions, the medium and the
audience:
The literature of advertising frequently discusses the "fit" between an
advertising message and a particular medium which can be thought of the
characteristics of the media that make it desirable to the advertiser in
terms of the ability to attract viewers or convey a message in particular
format. Vendors in the business of marketing web advertising normally
discuss the desirability of a web site in terms of three criteria (Schlag,
1996):
Desirability can also be thought of using the argument of "intellectual
affiliation." Advertisers look for the "halo effect" of being associated
with an influential or desirable organization.
In addition to the qualitative aspects of a specific medium, advertisers
are also interested in quantitative aspects of the medium or audience
measures. The most common dimensions of audience measurement are the
number of messages going out or the number of potential receivers in the
audience that can receive any given message.
At present, web advertisers do not have a standard set of measurements for
audience size and accurate measurement remains an unresolved issue in web
advertising. Web sites typically count the cumulative number of visitors
to a web site, but visits are problematic as an audience measure since
there is no indication of who makes such site visits. In some cases,
advertisers use independent measurement services such as the CommerceNet/
Nielsen Internet Demographics Survey, however, these can add substantially
to the cost of Internet advertising. (Readers interested in additional
information about Internet audience measurement services are directed to
the CommerceNet/Nielsen Internet Demographics Survey reference in the
bibliography or to the WWW search tools using the keywords "Internet
demographics").
Pricing and Production
Concurrent with identifying the market value of the service potential web
advertisers also need to develop policies for pricing the advertising.
Some knowledge of the costs involved is necessary as is the market for
such advertising, however, the managerial and economic considerations in
setting prices are beyond the scope of this analysis. The items below are
general guidelines for the issues that make up pricing policies
independent of the cost and market forces of an organization. They are
organized broadly into format-related, format-independent and
miscellaneous production issues:
Earlier sections of the paper have discussed the utility of policies in
supplying rational consistent responses to managerial situations. Nowhere
is this more important than in the decisions an advertising vendor makes
concerning who may advertise and the nature of acceptable advertisements.
Some advertising copy will be misleading, in poor taste, detrimental to
the interests of the vendor or otherwise poorly written. Regulation
protecting the public from poor advertising comes in part from
governmental regulation but for the most part, advertising is self-
regulating (Kaufman, 1987; 518). On the part of advertising vendors this
regulation is reflected in policies that describe what is acceptable in
advertising copy .
An acceptable use policy will vary among organizations, however, a general
standard for such a policy might be expected to reserve the publisher's
right to (SRDS Consumer Magazine Advertising Source, 1996, p. A63):
Reject or exclude copy which is unethical, misleading, extravagant,
challenging, questionable in character, in bad taste, detrimental to
public health or interest, otherwise inappropriate or incompatible with
the character of the publication [or web site], or that does not meet with
the approval of the Federal Trade Commission.
A variety of industry groups and publications can offer guidance in
formulating acceptance policies. Among these sources are the National
Advertising Division and the National Advertising Review Board, both of
the Council of Better Business Bureaus, who offer national advertising
guidelines and review services for advertisers. The guidelines supplied
by these associations do not carry the force of law, but the organizations
are widely respected and their guidelines provide a strong ethical and
legal basis for acceptable use policies.
Public and other not-for profit organizations should be aware that their
acceptable use policy must often deal with a wider spectrum of opinion
concerning advertising standards than commercial vendors. The literature
concerning public organizations suggests that they are more likely to be
accountable to groups and individuals outside the organization (e.g.,
Bozeman and Bretschneider, 1986). In the context of advertising, this can
mean accountability to a larger group of stakeholders concerning what
constitutes an acceptable advertisement. Planned Parenthood Inc., for
example, is a legitimate purchaser of advertising space in a number of
venues but may be deemed an unacceptable advertiser for political reasons.
Other matters that might be included in an acceptable use policy include
the size and style of advertisements, multiple advertisers, allocation of
space to competitors, etc. Readers are directed to the SRDS Consumer
Magazine Advertising Source listed in the bibliography for contract and
copy regulations that frequently appear vendor's sources material. As in
the case of the Better Business Bureau sources, the instances do not carry
the force of law, but are a reasonable illustration of industry practices.
5. Appendix A: Sample rate card for NFP WWW advertising
vendors
Vendors of advertising space generally publish all of their fees and
policies on a standard document known as a rate card. Card, in this
context is a convention of terminology. Rate cards are typically
multi-page documents. In the case of web advertisers we might also expect
rate cards to be electronic documents or separate web pages.
A sample rate card for web advertisers is presented below. The sample card
is only hypothetical and readers should not assume it reflects actual or
suggested prices for the service. Similarly, individual advertising
vendors make different policy decisions which will be reflected in their
rate cards. Text in brackets is a commentary on the rate card provisions
and not a part of the public text of the rate card.
Susan Smith: Marketing Director
[Graphics from the source's world wide web and a description of the sites
appear at the top of the card. Normally there is some description of the
audience characteristics (i.e., who is an advertiser likely to reach
here). Some measure of the size of the potential audience is typically
presented since advertising is priced partly as a function of the number
of eyes that potentially see an advertisement. The audience numbers may be
audited or unaudited depending on the measurement technique.]
World Wide Conference Information offers a 15% commission to advertising
agencies that provide HTML formatted copy on a 3.5 inch diskette, readable
on either MacIntosh or IBM machines.
[15% is an industry standard for agency commissions.]
All advertising must be fully paid for within 10 days of the date when the
advertising begins running. Failure to pay will result in termination of
the advertisement.
Advertisers who purchase five or more months of advertising are entitled
to a 10% reduction in the rates.
[Other rates and methods of discount including set dollar reductions are
also common. Typically, the advertiser contracts with the vendor to
purchase more advertising as a condition of receiving the discount.
Failure to purchase the requisite advertising in a given period normally
carries some contractual penalties such as rebilling at the individual
advertisement rates, i.e., "shortrating."]
All rates quoted are for a 30 day run unless otherwise noted. Advertising
copy may be color or black and white, with no difference in pricing.
Standard screen area (480 X 60 pixels) or fraction thereof: $500.00. Other
image and banner sizes can be negotiated.
Advertisers may place one hot button in each standard screen area.
Additional hot buttons may be purchased for the advertisement at the rate
of $50.00/each.
Advertisements are programmed to appear randomly in 25% of all home page
viewings. More frequent appearances may be purchased at the rate of
$100.00 for each 25% increment.
[It is also possible for an advertiser to negotiate a display that appears
permanently for a fixed amount of time.]
The World Wide Conference Information home page accepts only static
advertisements.
[Policies at other sites may be different depending on the availability of
digital storage and supporting software and the advertisement's potential
to distract the page's users.]
The advertiser agrees to indemnify the site owner completely for any
damages or litigation that results from misleading or fraudulent claims by
the advertiser or through the advertiser's error.
The site owner reserves the right to reject or exclude copy which is
unethical, misleading, extravagant, challenging, questionable in
character, in bad taste, detrimental to public health or interest,
otherwise inappropriate or incompatible with the character of the
publication [or web site], or that does not meet with the approval of the
Federal Trade Commission.
[It is also common to cite the numbers of relevant paragraphs in SRDS
Consumer Magazine Advertising Source (CMAS) to save space in the rate card
since the provisions supplied in the CMAS tend to be standard throughout
the advertising industry.]
6. Notes
1.The "Al Bento Web Software Collection" contains
pointers to a wide range of software that can be used to design WWW pages.
2. For example, there is a listing of elementary
school home pages
3. Information about the OCLC Internet project can be
found on the web.
A good source for information about digital libraries, including the URLs
for the ongoing digital library projects is D-Lib Magazine.
A good site which gathers together a range of WWW search tools is
SearchIT, at Northwestern College:
4. The page of useless pages has been "hit" over one
million times since it was created!
5. Commerce on the Web is a listing of WWW sites
set up by businesses.
6. There have been businesses on the WWW for several
years, but the conventional wisdom has held that consumers will not engage
in commerce until problems of security have been resolved. Recently there
has been a challenge to the conventional wisdom which holds that there is
less chance of consumer fraud on the Internet than in any other arena
which used credit card transactions. In addition, technical solutions
like the recently announced "Cybercash," which may provide consumers with
the confidence to begin exploring electronic, Internet-based commerce.
7. A standard textbook definition of advertising is
"nonpersonal communication of information usually paid for and usually
persuasive in nature, about products, services, or ideas by identified
sponsors through various media." (Arens and Bovee, 1994). For the
purposes of this paper, this definition must be expanded to include the
broad range of promotional activities in which those creating and
maintaining WWW sites are engaged in their efforts to draw users to their
sites.
8. This is a strategy proposed by a WWW advertising
company, 20/20 Technologies, in their overview discussion of their
business strategy.
9. Java is a WWW programming language/software from
Sun Microsystems that adds local functionalities to WWW pages from a
remote source. According to their literature:
Java(tm) is a simple, object-oriented, distributed, interpreted, robust,
secure, architecture-neutral, portable, high-performance, multithreaded,
dynamic, buzzword-compliant, general-purpose programming language. Java
supports programming for the Internet in the form of platform-independent
Java applets.
10. Shockwave is software provided by Macromedia
which:
Enables the playback of high-impact multimedia on the World Wide Web,
setting a new level of interactive performance on the Internet.
7. Bibliography
Arens, W.F. and Bovee, C. (1994). Contemporary Advertising (5th
Ed.). Burr Wood, Illinois: Irwin.
Bozeman, B. and Bretschneider, S. (1986). Public Management
Information Systems: Theory and Prescription. æPublic Administration
Review. 46. p. 475-487.
CommerceNet/Nielsen. (1996). CommerceNet/Nielsen Internet
Demographics Survey
Gray, M. (1995). Measuring the Growth of the Web:June 1993 to June
1995
Internet Solutions. (1996). Internet Statistics --Estimated.
Kaufman, L. (1987). Essentials of Advertising, 2nd ed. Orlando,
FL: Harcourt, Brace Jovanovich, Inc.
Leacock, S. B in Jackman, M. (Ed). (1982). Crown's Book of Political
Quotations. NY: Crown Publishing Inc. p. 1.
Leonard, A. (1995). Caught in the clickstream. Web Review. 8.
Matrix Information and Directory Services, Inc. (1996). Sizes of the
Internet in October 1995, from the Third MIDS Internet Demographic
Survey.
Orwell, G. in Partington, A. (Ed). (1992). The Oxford Dictionary of
Quotations. NY: Oxford University Press. p. 501.
Pitkow, J. and Kehoe, C. (1996). GVW's WWW User Surveys: Executive
Summary.
Schwartz, E.I. (1996). Advertising Webonomics 101. Wired. 4.02.
p. 74
Schlag, S. (1996, January). Interview with C. DelGrande, Senior Vice
President, Interealty Corp. Unpublished interview data.
SRDS Consumer Magazine Advertising Source. (1996, February). Des
Plaines, IL
Working Group on Internet Advertising. The Coalition for Networked
Information. (1994). Electronic billboards on the digital
superhighway.
World Wide Web Consortium (W3C). (1996). About the Web.
See also W3C. (1996). A Little History.
© 1996, American Society for Information Science. Permission to copy
and distribute this document is hereby granted provided that this
copyright notice is retained on all copies and that copies are not
altered.
This document was prepared by Howard
Rosenbaum. Comments are welcome.
As has been the case with previous Internet innovations, the WWW was
initially intended to be a tool for academics. Its original purpose was to
allow members of the international physics community easy access to a
growing web of scientific information linked through "hyperlinks" which
took advantage of HTTP. Within three years, the number of users of the
WWW had increased exponentially, from a several thousand "technology
developers/pioneers" to an estimated 18 million people from "diverse
segments of the population" (Pitkow and Kehoe, 1996). The rapid and
continuing expansion of the WWW is attributed to "look and feel" of WWW
documents and, more specifically, to the release of the Mosaic and
Netscape browsers and the ease of use of HTML, the primary markup language
used to create WWW documents.
For both advertisers and Internetters, this emphasis on information
controlled by the reader changes the nature of advertising.
Second, traditional advertising uses brief and distilled messages to catch
and hold the consumer's attention and depends on the power of repetition
to deliver the message. Content is minimized to fit the time constraints
of a television commercial or the size constraints of a magazine page.
WWW-based advertising works within a different set of constraints which
emphasize content as much as presentation and the content must be dynamic,
substantive, and relevant to a variety of audiences.
More specific exclusions and qualifiers may be tailored to individual
organizations
and it should be noted that vendors are generally given considerable
latitude in
determining the terms under which advertising is accepted.
Phone: xxx
Email: xxx
and a listing of automobile company web sites:
Obligatory disclaimer: At the time this paper was marked up [9.30.96], all
links used in the bibliography were working.
