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A study unveiled at the fifth annual MSN(R) Strategic Account Summit concluded that online advertising can produce significant increases in product branding and offline sales and that these effects can be achieved in a cost-efficient manner when compared with traditional marketing vehicles. In findings based on studies conducted between November 2003 and January 2004 of consumer-packaged goods (CPG) brands, results recommend levels of online spending that are dramatically higher than the current average (which is less than 1 percent*) within the CPG category. Researchers determined that online advertising generated lifts in sales ranging from 7 percent to 12.5 percent. In addition, when compared alongside ads in traditional media on a cost-efficiency basis, online advertising's effect on sales at the study's recommended levels outperformed the average of all marketing vehicles in the study by as much as 30 percent.
(Source: www.microsoft.com/presspass/press/2004/mar04/03-25AdsBoostBrandingPR.mspx)

o What factors do you think contributed to the 7% to 12.5% increase in sales?

o What online advertising strategy do you think is the most effective? Why?

Visit www.amazon.com and examine how that company implements behavioral segmentation. Write and describe two clear examples of behavioral segmentation on the site.

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Solution Summary

Strategic Account Summit: What factors do you think contributed to the 7% to 12.5% increase in sales?

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The boost in sales from 7 percent to 12.5% is attributed to increased visibility and awareness about the company and the brand due to online advertising and promotions. Online advertising help in pushing retail sales by making the presence felt among a wider audience at cost effective rates. As more and more people are using web to gather information and research about products before making purchasing decisions, web marketing tools are an efficient way to assist offline sales by significantly enhancing brand presence, visibility and awareness.

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