The Internet is changing the playing field for both ad agencies and their clients
White the Pioneer Valley still lags behind other areas of the country in terms of Internet marketing, it is expected to do a good deal of catching up in 2000. This will bring both opportunities and challenges for the region’s advertising and marketing firms, who, like their clients, are adapting to a new way of doing business.
When Tammy Dubuque, publisher of the Western Mass.Web Guide, visited Manchester N.H. recently she was struck by what she saw. “There were Web sites advertised everywhere,” she said. But as far as Western Mass. is concerned, it is a phenomenon yet to catch on.
According to Dubuque, there are still businesses that have an “if you build it, they will come” approach to their Web sites, but the rapid growth in national dot-corn advertising is quickly changing that way of thinking. There are already nearly 4,000 businesses who list their Web sites in the Western Mass. Web Guide, with the most growth in advertising for consumer-targeted sites. This year, she said, is the year that Internet advertising will take off in Western Mass.
There are already signs of this already happening.
Drivers heading south on Route 91 into Springfield can see a huge billboard for yourebank.com – a local online full-service bank which is a division of Hampden Savings Bank. The billboard is an example of how “old media” is used to promote a “new media.” But the advertising chain stretches further-not only does the billboard promote an Internet product, but the Web site that viewers are directed to promotes old-fashioned bank products from Hampden Savings Bank, in addition to the on-line banking options.
That’s the other side of Internet marketing – Web sites being used to advertise traditional products and services. Meanwhile, the fourth kind of Internet marketing, using Web sites to promote other Web sites, is also becoming more prominent in the Pioneer Valley. Ride Noho, for example, is a startup bicycle tour company that advertises its Web site – www.ridenoho.com – using banner ads on other cycling-related sites.
All this Internet marketing is forcing advertising agencies to rethink the way they do business and to either create in-house Web design studios or form partnerships with outside groups. Either way, opportunities abound.
Van Schouwen Associates, one of the larger advertising firms in Western Massachusetts, was one of the first in the area to fully embrace the Internet as an advertising medium.
“At first, we had to beg people to do anything on the Web,” recalled partner Michelle van Schouwen. “Now, of course, everyone is interested.”
BusinessWest looks this month at the many ways in which that interest has manifested itself, and what the boom in Internet advertising means for area advertising agencies.
Web of Intrigue
Unlike many other advertising firms, van Schouwen Associates hired a programming staff and put up servers instead of outsourcing the work. The result is that not only is the Internet integrated into everything the agency does, but the company finds itself even more closely involved with the internal workings of clients’ businesses.
According to van Schouwen, a fully functional Web site may be tied in to inventory control, sales, or the supply chain. Of course, marketers have always had to be aware of internal business issues. “It’s always a marketing firm’s business to know when to push a product and when supplies are low,” she said. “But more and more clients are asking us to do unprecedented work on the Web. Examples include bringing the exchange of complex information to the Internet on a subscriber basis for clients, offering different levels of pricing to preferred customers and to occasional buyers, and providing the Web site sponsors with the ability to accumulate and analyze data. These are the challenges that we’re facing now.”
In some cases, the result has been a radical redefinition of what the client does. One customer, Hartford-based electrical wholesaler CLS Inc., set up not only a Web-ordering system but a whole new company, Net Possibilities, with its own Web sites – buildingsupplies.com and electriciansWeb.com – that promise to radically change the way building and electrical supplies are ordered.
All in all, some 80 of van Schouwen’s clients have a basic Web site set up, and nearly all are in some stage of Web site development. Another 25 to 30 have a more developed Web site, with E-commerce or interactivity. “The time is ripe,” said van Schouwen. “Some people would tell companies that it’s too late, but there’s going to be a window of opportunity for the next five years, depending on the business.
“In some industries, you’re in trouble if you haven’t already started moving – it’s critical to be on the Internet if you’re a distributor, if you are a strong business-to-business company, or if you are a bank,” she continued. “But the traditional manufacturers need to get moving, too. It’s not over for them, but they need to start thinking about their next steps as their customers demand more information and access to purchasing.”
Companies take various approaches to getting on the Internet. Some ask their marketing companies to do it for them, others do it themselves, and still others find a third-party service provider. The marketing agency, van Schouwen said, can be involved in various stages of the process. “Our role and our contribution begins and ends whenever it works for the client.”
The availability of outside agencies that handle Web-site design opens opportunities for advertising and marketing firms that don’t have their own in-house programming staff.
Ideas That Click
For example, when Hampden Savings Bank opened the doors – relatively speaking – of yourebank.com earlier this year, John Garvey of Garvey Communications wasn’t expected to work on the site itself. But his agency did put together the television ad, print ads, and the billboard. “We’re not an interactive agency,” Garvey said. “We’re a strategic marketing agency. We don’t do the coding and scripting here, but we do strategic market plans and communications … we do the art work.”
Garvey will work with Web-site designers to develop an appropriate “look and feel” for a site, and will partner with Web site development firms if a client needs programming work. Even though he doesn’t have programmers on staff and doesn’t expect to hire any in the immediate future, he said that 50% of his agency’s work already involves the Internet. “You’ll notice if you read AdWeek that for most advertising and marketing agencies, the largest-growing portion of new accounts are Internet related. That’s true for us as well.”
For some agencies, the lack of in-house programming staff can be an advantage. “If you build a lot of infrastructure you can’t change as quickly,” said Paul Robbins, a partner with Springfield-based FitzGerald & Robbins. Instead, Robbins said, his agency partners with a variety of service providers, depending on the needs of the client.
“I think what happens when you put that stuff in-house is you wind up telling the client, ‘We think you need a new Web site because we have an in-house Internet studio,'” he said. “When you have the overhead, you tend to want to feed the overhead. I’d rather have a consultant who’s an expert in the Internet rather than having that person sitting in the office here.”
Meanwhile, advertising and marketing agencies have had to get on the electronic bandwagon in another way, as well – today, much of the agencies’ work takes place over the Internet. “Most of our communications with clients and with our vendors and the partners we work with are conducted through the Internet,” said Garvey.
“It saves time, energy, and money,” said Nancy Urbschat, a partner with The Super Market. “A classic example is moving ads from our computer to a publication. It used to be that we had to prepare film and FedEx it out. Now, we E-mail them, so it makes us more efficient and productive. We rely a great deal on E-mail. Clients E-mail us pertinent information. I’m a copywriter, and reviewing copy is just a matter of sending it as an attachment.”
That probably makes it even easier for advertising and marketing agencies to work with clients who are also well integrated into the online world.
For Urbschat, one of those clients is Al Tiboni, founder of Ride Noho. The company is an exceptional client, Urbschat said, because of the way the Internet has been integrated into every facet of the company’s work and advertising from the very beginning. Every piece of marketing that she produced referred people to the Web site. This wasn’t just business cards and letterhead – it included print ads, flyers, even bicycling jerseys.
The Web site, in tern, incorporated the graphics and text that Urbschat developed. “The materials we designed drove the design of the Web page,” she said. “It’s rare that someone has the foresight to make sure that every communication piece directs the viewer to the Web site. From the get-to, while we were developing their logo and the look of their brochure, they immediately went to their Web page so that it was available.”
In fact, she said, although the integration shown by Ride Noho was unusual, many established companies are also starting to think of their Web site as they do their letterhead or business cards.
“It’s becoming a part of a company’s identity. They’re coming to us to design an updated logo and they want to get letterhead and envelopes and a quote for Web design as well. They’re including Web design as part of an identity package, which is new.”
This means that even agencies that outsource the programming are having to become experts on the Internet. FitzGerald & Robbins, for example, is planning to expand its Internet capabilities as far as it can without actually going out and hiring programmers and investing in Internet technology.
“If you don’t change to keep you’re going to be left behind,” Robbins. “We ourselves have to learn, everyone else, about the Internet while at the same time not forgetting that we’re storytellers.
“We’re still trying to persuade people whether we’re doing it through a direct mailer, television, or the Internet, that doesn’t change,” he added. “But almost all of our clients have a Web site in various stages of development. A couple don’t, and they’re asking us to help make that happen. Others are asking us to help them get into E-commerce.”
Robbins and his counterparts say the marketing industry has entered a new era, and the Internet is the biggest factor.
“People feel that they have bigger markets, and are in a bigger marketplace,” he explained. “I think there’s a freedom that comes with the Internet.”
And with freedom comes opportunity, for all parties.