What is advertising?

Advertising refers to the paid promotional activities carried out by a company aiming to sell its product or service. 

It’s one of the oldest forms of marketing around, and its goal is to convince the target audience to make a purchase of the advertised product. 

A secondary purpose of advertising is to create brand awareness. 

Advertising can be done by the company itself, or by an advertising agency that manages advertisements. 

The most familiar forms of advertising for the majority of people are television and print advertising – who hasn’t seen a Coca-Cola ad in a magazine or heard McDonald’s iconic jingle on TV? 

Types of advertising by business model with examples

There is no one-size-fits-all advertisement that magically sells your product. Some methods work better for particular industries than others. 

Advertising and advertisements are constantly evolving, but there are a few key advertising models that work well for most businesses. 

Traditional advertising

In these forms of advertising, the advertising message is usually distributed to a wider audience, with the aim to reach as many people as possible rather than particular target customers: 

• Print. Print advertising usually refers to advertisements in newspapers and magazines, where a company has paid money to display their advert on a particular page. It’s also possible to run a print ad campaign with self-produced flyers and leaflets and either mail them directly to the customers or personally hand them to people. 
• Broadcast. Radio and TV advertisements fall under this category. Most broadcasting companies charge a fee for a company to run a radio or television advertising campaign. Broadcast ads are the most complex traditional adverts to produce since they rely on many different media elements.  
• Billboards and vehicles. Billboards and vehicles offer a huge canvas to reach a maximum number of people. 
• Brand and product placements. Advertising agencies and big brands have usually the budget to sponsor a TV show or a sports team and get their preferred product or service placed in front of big audiences.
• Cold calling. While it has a negative reputation, cold calling as a form of increasing awareness can be highly effective, and is a particularly strong advertising method if the product or service can also be sold over the phone. 

Online advertising

Online advertising varies from traditional advertising methods because of the different platforms used and the amount of data available. 

It also enables more targeted advertising solutions to companies. Rather than reaching out to everyone and anyone, online advertising focuses on targeting the advertisements to those who fit the target audience or user persona. 

A digital marketeer should have a clear understanding of where online advertising takes place. Advertisements can be generally placed on social media platforms, in search engines, or as digital display ads on websites and news platforms. 

Many platforms support a variety of formats: you could create video ads, opt for more traditional banner ads, or even pay and display your full-screen ad on the landing page of a national newspaper’s website. 

The formats differ from each other in a couple of ways:

• Banner and display ads. Most banner and display advertisements operate on a ‘pay per click or action’ or ‘pay per mille (per 1000 displays of an ad)’ principle, meaning that you pay based on the number of visitors who either see your ad or react with it (be it only a click to your website or a completed order). Most banner and display ads are seen on social media or on websites.
• Video ads. These types of ads are the closest online equivalent of broadcasting adverts. Video advertisements are usually priced similarly to banner and display ads.
• Influencer marketing. This type of advertising is the online equivalent of paid product placements but works on a more direct level with a particular target audience. Since social media influencers have a close relationship with their audiences, who see the influencer as their friend, this type of advertising is similar to word-of-mouth recommendations.

Is online advertising important for eCommerce businesses?

The short answer is yes. 

Since an eCommerce business usually operates solely online, having a strong presence on the web makes or breaks your business.

Companies are predicted to spend over $375 billion on digital advertising by 2021. Since over 2.14 billion people across the world are expected to shop online by 2021, not advertising your business online could mean losing out on a lot of selling potential.

One major advantage that online advertising has for eCommerce is the level of targeting available. You can show your advertisement to those who have already ordered from your online store, or who have shown interest in similar products in the past. 

Online, you don’t have to worry about physical barriers like your customers’ location or time zone. 

A strong online advertising campaign can also have a direct impact on your eCommerce sales and return on investment. Advertising costs online are much smaller than paying for prime time TV ad spots. 

The consumer can also take direct action online: the buyer can independently place their order, rather than having to rely on store opening times and available sales clerks. 

This means that you can monitor your advertising campaigns in real-time and see which channels and campaigns work the best for convincing the visitors to take the desired action. 

Should you pay for advertising?

It can be tricky to understand when it’s a good idea to pay for advertising for an eCommerce business. 

You should consider paying for online advertising, if: 

• You’re just starting out. If you don’t have many monthly visitors, an existing email address database, or a strong social media presence, paying for online advertising is a great way to put your eCommerce store on the digital map. 

It’s easy to start with just a small monthly investment, and as long as you’re optimizing your campaigns vigilantly, your return on investment can be huge. 

• You want to boost your existing traffic. You took the time and built up a decent email database and are seeing modest conversions from your email marketing campaigns. 

Maybe you have an up and coming Instagram account and get good quality traffic to your eCommerce store from there. It’s a good idea to start combining paid advertising with your organic online presence. 

You can use the data you already have to target your paid campaigns to people who are most likely also interested in your product. 

However, there are some instances when it’s not worth paying advertisers for ad space online: 

• You’re acing your SEO and content marketing. Are you quite the trendsetter and people across the internet are talking about your eCommerce store already? 

If you’re running a content-heavy eCommerce business, and are getting a steadily increasing amount of organic traffic through search engines, you might not need to pay for additional advertising online. 

• You’re a market leader. If you’ve made it to the top, you can probably leverage on other forms of online advertising and invest your profits elsewhere. 

How to create an effective advertising campaign for eCommerce

Who wouldn’t want their brand name to be the first one that comes to the buyers’ minds? 

There are a couple of steps you can take to make your eCommerce advertising campaigns worth the invested money and time. 

1. Start by defining your audience

You need to know your target audience and who is the ideal customer for your business if you want to run effective online advertising campaigns. 

You can start by doing target market research and defining the buyer persona for your business. 

Get started by: 

• Analyzing your existing customers 
• Running surveys and focus groups 
• Analyzing your website and the individual pages 
• Analyzing keywords and your competitors

Find trends and shared characteristics among the data you’re collecting, and start building a profile of the ideal buyer for your eCommerce website.

Include things like: 

• Demographics: their name, age, location, language, income level, education
• Psychographics: their interests, goals, challenges, buying personality 
• Preferences: the types of marketing channels and media they prefer 

2. Match your audience’s goals with your business goals

Once you know what your audience is looking for in a product or service, and what they struggle with in relation to your business, match your product with those goals and pain points. 

If your target audience prefers to wear sneakers but hasn’t got the cash to pay for the expensive brands, you could include a budget-friendly sneaker line in your eCommerce shoe store. 

Or if your ideal customer wants to make ethical buying decisions, you can donate 10% of all your profits towards an appropriate charity, or make your business’ ethical supply chain part of your marketing messages. 

3. Create highly converting landing pages for your eCommerce products

Next, you need to consider how good your eCommerce web design is from a conversion point of view. 

A conversion in online marketing terms refers to visitors who took a desired action. This could be a signup for a newsletter or a new order. By tweaking your landing pages, you can enhance your conversions. 

Pay attention to things like: 

• Page design. A good-looking landing page that’s easy on the eyes will convert better than a page that takes a while to decipher. Make sure your photos are high-quality and your branding is coherent. 
• Call-to-action (CTA). A CTA refers to usually buttons or banners that encourage a visitor to perform a desired action.  
• Copy. The words you use as just as important as your overall design, so make them count.  
• Website speed. The longer your page takes to load, the more likely it is that your visitors will click away. 
• Overall site structure. Your whole website should be easy and clear to use. Avoid any unnecessary pages that don’t serve the purpose of convincing your user to make a purchase.  

4. Create attractive ads for those marketing goals

Your ads should grab the attention of your target audience and make them want to click on it. 

An effective online advertisement has: 

• A headline. An attention-grabbing headline will determine, whether the rest of your ad is read or not. 
• A subheading. Sometimes, you might need to expand a little on your headline. Use a subheading for that. 
• Body copy. This is the place in your advertisement where you convince anyone reading to take action.
• Image. An eCommerce store relies on visuals to sell, so you want your ad image to stop the visitor in their tracks. 
• A call-to-action (CTA). In online advertising, the CTA usually takes the form of a clickable button or a banner. 

5. Continuously tweak your funnel to optimize costs and sell more

After launching your advertising campaign, your work is not over. You want to optimize and analyze your advertising campaigns to be sure that you’re getting the most out of your ad. 

Make sure the advert is profitable, in comparison to your overall marketing spend, the other advertising campaigns, and the channel you’re using. 

Maybe your email marketing campaign is to generate high traffic to your landing page, but only a small percentage of the visitors end up making a purchase. 

On the other hand, your Facebook advertisement is bringing fewer visitors to your landing page, but a high number of those visitors end up ordering your product. 

You should also regularly keep an eye on your website structure, and ensure every page is loading fast enough, there are no bugs present, and so on. 

The key is to understand your key metrics and be consistent in your marketing efforts.