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Working extra hard to
assure visitors
The world has, and will continue to,
witness the collapse of many dot-coms due to the shortage of
operational funds.
Ads, which webmasters hope to arrive in
time to color their websites, have failed to appear. Only a few have
managed to grab advertisers to spend their money on cyberspace
business.
Here in Indonesia, only two operators
have achieved relative success in clutching advertisements for their
screens.
Detikcom (www.detik.com), for example,
claims to have enjoyed Rp 6.5 billion in earnings from ads (over
US$660,000) last year alone.
Kompas Cyber Media, or KCM,
(www.kompas.com) earned Rp 2 billion for the same period.
Sadly, many websites are still bare of
advertisements, a prime element of the life of such a business.
Customer's fees, another financial source, will only arrive if
websites offer great value for visitors.
What about offering it at a stock
exchange?
It's not as easy as a dream. Only sites
with brighter prospects, meaning a website that embraces adequate
numbers of advertisers and visitors, can meet standard requirements
for initial public offering.
Then we come to the question of whether
it's still worth advertising on the Internet.
Future market
Some say that I-advertising, as many
put it, is quite effective. Others believe that advertising in
cyberspace will become necessary in the next few years when more
Indonesian families have their own online PCs at home and the country
has a cheaper and more reliable access to the net.
"We still rarely place ads for our
company at other websites except with our business partners, which is
free of charge. For us, it's still not effective and many people in
this country still have limited access to the net. People in Indonesia
also seem culturally reluctant to carry out transactions (using
cyberspace)," Djoenaidi, assistant vice president for consumers
and e-banking of Bank International Indonesia (BII) (www.bii.co.id),
told The Jakarta Post on Monday.
But Djoenaidi firmly believes that
I-advertising in Indonesia will boom in the future.
According to research, the number of
Indonesians who have direct access to the Internet has reached 6
million people out of the country's 210 million population.
Unfortunately, there's no guarantee
that the 6 million web users are spendthrifts.
Another important factor to take into
consideration is that the number of internet subscribers via ISP is
much lower than the 6 million figure. In other words, many Internet
users browse websites from their offices, warnet (Internet kiosks) and
other people's houses!
This fact reflects the reality that
many Internet browsers here are not coming from a group that intends
to spend and spend.
"The growth of dot-coms in
Indonesia is faster than the growth in Internet users," commented
an IT observer.
But there's still good news. Many
marketing managers in this country have planned a substantial budget
to be spent on the company's promotion on websites in years to come.
Several indications can already be seen
on the horizon.
One of them is the significant growth
of ads every year at Detikcom and KCM.
In line with the estimated boom, some
advertisement agencies have started establishing a special division
for I-advertising. Many dot-coms have begun to realize that their
business doesn't only need advanced and sophisticated technology but
also requires a proper and accountable marketing strategy to lure
visitors.
A faster economic recovery in this
populous country could help speed the realization of this hope.
Regular clients
So far, regular advertisers on the
Internet here are still limited. Most of them are companies related to
cyberspace and IT businesses, like Intel Corp., IBM, Zyrex, and those
in the telephone and mobile phone industry.
Similar to "foreign"
websites, most of the ads on the Internet here consist of other
websites and sponsorships.
Few firms, which are unrelated to IT,
have started placing banner ads at certain websites in an effort to
attract people to visit their homepages.
So, it's totally different to
"traditional" media like newspapers where readers can
directly view products or services.
"In the Internet world, visitors
have to spend extra time and money (for telephone billing) to view a
product, while in a newspaper it's instant," said an IT expert,
who refused to be named.
Advertisers have yet to maximize
multimedia usage, which could provide text, video (in the form of
either animation or a movie) and sound all at once.
But KCM, a portal run by a company that
owns Kompas daily, which has the biggest newspaper circulation in the
country, has initiated an advertising format for its website as part
of its efforts to woo clients.
With round-the-clock news from Kompas
networks, up-to-date articles from its sister publications and with 40
percent of its visitors living overseas, KCM is the most appropriate
website for I-ads, said Andrey Andoko of KCM, which was previously
called Kompas Online.
Moreover, he added, "I think very
few Indonesians haven't heard of Kompas."
Like in other media, the rate for
placing ads on the Internet differ from one website to another.
"If you claim bigger earnings, you
can raise your rate higher than your rivals. It's unfair, indeed.
Thus, this type of business might require independent accounting to
find out the truth behind the figures they release to the press,"
an IT observer said.
From New York, consulting firm
Booz-Allen & Hamilton suggested on Thursday that Internet media
networks, or portals, need to abandon direct marketing and banner
advertisements and embrace brand-building through sponsorships, new
service offerings and co-branded ventures.
In a press release, the firm said
consumers are using Internet media networks as destinations rather
than as gateways to other sites.
While Internet media networks remain
enormously popular with 60 percent of Web user sessions including site
visits, portals need to adopt new business models to remain viable.
Users also spend three times more time,
an average of 4.5 hours, at Internet media networks than they spend at
shopping or entertainment sites.
The best way for marketers to capture
attention is to treat Internet media networks as brand development
venues, paying them for the total numbers of impressions, or images,
they deliver, the consulting firm said in its report.
Companies should consider sponsorships,
attaching their names and messages to appropriate parts of a portal
site or creating new sections altogether.
However, many Internet media networks
still cling to an outdated revenue model that relies on ad payments
based in part on click-through rates, the report said.
"Marketers must start thinking of
portals in the same way as they think of mass-circulation magazines
and television networks -- as major centers of commerce and content
that draw huge audiences," said study co-author and Booz-Allen
& Hamilton Vice President Horacio Rozanski.
So, we all hope that ads on the
Internet will soon realize the predicted boom, not doom as the
business still lies in its vulnerable infancy.
-- Jon Minofri and K. Basrie |
