Banner Ads Suck. Now Apps, Those Are Cool.

An agency strategy perspective

Where we are:

Despite significant evidence that times are changing, most of today’s websites continue to follow the traditional publisher/audience model. The site publishes an article or content, users view the content for free, and in exchange, view a banner ad.

User time spent reading editorial on a news website has dropped to an average of 8 seconds. Industry wide banner ad click thru rates hover in the .01 percent range, and only the best funded, integrated campaigns garner decent click thru and conversion numbers. Even campaigns with large budgets are challenged to generate enough frequency (repeat views) to gain enough visitor attention for positive results.

What we’ve learned:

Banner ads and the traditional publisher models suck online.

Where we’re going:

Strategic communication that mirrors human communication.

This is where applications come in. Facebook has changed the way that users interact with the web, becoming a central hub of communication, friendship, and networking. Facebook’s apps garner substantial repeat usage, often several times per day, every day, on an ongoing basis.

For publisher, marketing, and media types reading this article: Imagine that type of loyal visitorship on a traditional website.

Facebook apps provide a utility, a service beyond content. Users interact with their friends and share app interactions in methods similar to human communication and word of mouth. Users spend time with the app, and are engaged, two of the most vital metrics in today’s rich media (read: fancy banner) ads.

PointRoll’s most recent newsletter places their benchmark interaction rate at 6.47% (Interaction Rate: Total Interactions/Total Impressions). Their benchmark brand interaction time sits at 14.67 seconds (weighted average of total seconds that panels were displayed within an individual impression).

As you’d expect, app based ads have the potential to blow rich media out of the water. There isn’t much data out there at this point; however, you can be sure we’ll see more as the large app companies pursue their monetization strategies. If you need proof, think of your most recent interaction with your favorite app. Did you do more than seven things when you loaded the app? If so, your app is beating the best that rich media and interactive advertising has to offer.

While it’s a little early in the app world to discuss the realities of cohort groups, we’ll see messages placed within apps shared offline within groups, stimulating word of mouth. Think of reaching an entire group (network) of friends with similar interests at once. Apps are quickly expanding their audiences. It’s just now that it’s starting to be possible to reach demographics other than those under 20, and the future is looking pretty cool.

Aaron Gasperi is an Interactive and Research Analyst at Kruskopf Coontz.

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