Online shopping is popular, yet online advertising appears to compel consumers to put down their laptops and visit their local stores.
A study of online advertisers by comScore Inc., an Internet information provider, found that in most cases online advertising actually drove more sales to the companies' brick-and-mortar locations than to their Web sites.
Online advertising isn't just for online retailers and national chain stores. Blue Ribbon Digital, an online advertising agency, believes with an estimated 200 million consumer searches for tire and automotive aftermarket products and services annually, tire dealerships of all sizes should take advantage of the power of the Internet to boost sales.
A 2006-07 Yahoo! Inc. and comScore study surmised consumers exposed to online advertising spent an average $6 on offline purchases for every $1 spent online.
The study examined the impact of search and display advertising on in-store sales for five major retailers and determined that consumers exposed to online advertising tend to research online before making a purchase. These so-called ``pre-shoppers'' spend an average of 41 percent more in-store than consumers not exposed to online advertising.
``Although recent research cites 89 percent of consumers shop for information about products online, less than 7 percent of retail sales actually take place online,'' said Amy Vener, senior director of retail category at Yahoo!, in a press release.
``This means retailers have a prime opportunity to engage this audience of `pre-shoppers' through online advertising to capture incremental sales in-store,'' she added.
Local display and search advertising on the Internet is expected to increase at a 13-percent compound annual growth between 2007 and 2012, faster than online advertising as a whole, according to JupiterResearch L.L.C.
The increase will be amplified by an ongoing strategic push on the Internet by newspapers and Yellow Pages publishers, as well as major search engines, according to the research firm.
``Traditional media will continue to play an important role in the local market. But it's essential for (retailers) to transition their customers to these new media before their competitors do,'' said Barry Parr, media analyst for JupiterResearch, in a statement. ``However, the ability to assemble large audiences in the local market will remain a principal advantage of traditional media.''
Consumers obtain most of their information online (39 percent) and from television (39 percent) vs. radio (13 percent), newspapers (5.5 percent) and magazines (2.7 percent), according to a JupiterResearch survey in 2006.
The sooner retailers understand this shift and change their marketing and advertising efforts to align their message with where the consumer has already migrated, the better their bottom lines will be, according to Matthew Greene, president and CEO of Blue Ribbon Digital.
By logging onto search engines, Yellow Pages-type sites and comparison shopping sites, consumers ``have already said they want to buy a product,'' Mr. Greene said. These three channels ``are the number one sales generators.''
``People who research online and buy offline, their motivation was not necessarily cost but convenience,'' he said, noting many consumers don't want to wait for a product to be delivered and would rather run to the local store and pick it up.
Discount Tire Co. has taken a leading role in Web-based marketing, according to Mr. Greene, whose agency helped develop the Scottsdale, Ariz.-based retail dealership's Web advertising. He claimed Discount Tire's Web advertising has ``driven hundreds of thousands of transactions since 2002.''
Back in 2003 ``our emphasis was to drive traffic to the Web site and cause people to pull out their credit cards and buy tires,'' Mr. Greene said.
But then he said Discount Tire management wanted to find ways to drive consumers from the Web site into its stores. That prompted Blue Ribbon to pursue advertising on localized search engines to reach local markets. It trademarked the strategy as ``Click2Mortar.''
He believes other tire retailers, from large chains to single-store operations, should also take advantage of the promotional opportunities on the Internet. Discount Tire is able to leverage sales at its 700 stores through online marketing. Its Web site not only offers online purchasing, but it also offers information for consumers researching tires and provides locations where they can buy tires conveniently, according to Mr. Greene.
``Consumers in the market to buy tires and wheels like to interact with online advertisingwhether it's to get rebates and coupons or in a research mode and looking for more information and a store location.''
The advantage of Internet advertising is that the advertiser can gauge the effectiveness of the adshow many customers saw the ad and how much time they spent looking at the ad and/or Web site and how many made purchases.
``The Web can be sort of a level playing field between big and small retailers,'' Mr. Greene said, noting that ``the Web is the great democratizer'' in that it costs just as much for a giant retail chain to advertise on a local search site as it does for a small local dealership.
``The Web is a change agent,'' Mr. Greene advised dealers. ``You owe it to your company to invest in the Web, promote your Web site and to be advertising on the Web as in other areas.''
Mr. Greene noted that listing prices in online advertising isn't important, rather ``the emphasis for mom-and-pop (dealerships) and those with 10 to 20 stores is familiarity with and in the marketplace.'' He said dealerships should promote their longevity as well as advertise manufacturer sales.
While many tire dealerships have some sort of presence via Web sites on the Internet, they leave a lot to be desired, according to Mr. Greene. He noted that the top 40 largest tire dealerships have Web sites.
``The range and continuum of how they build their sites range from not horrible to really horrible,'' he said.
Mr. Greene said DiscountTire.com and DiscountTireDirect.com draw about 1 million visits a month while ``everyone else'' on the list generates less than 100,000 hits monthly.
He said a common mistake companies' senior management make is taking the approach of ``how many widgets can we sell on the Web site vs. how to improve our Web presence, leverage the brand and give customers the information they want really fast.''
``Consumers use the Web to their advantage and become an informed consumer. They take action once they're fully informed,'' Mr. Greene said. ```Can we make money on the Web?' is not the right question. (Rather,) `Am I giving the consumer the information they seek in a timely manner?' If they're informed, they are more likely to buy my retail brand.''
He considers an effective Web site as one that provides ease of functionality and navigation.
``If I were a mom-and-pop store, I would look to the Discount Tire site and see what they do and to mimic the functionality of the site,'' he advised.
Retailers should set up their Web sites as ``pre-shopping destinations''offering in-depth product information, consumer reviews, product comparison tools, online store inventories, and other interactive tools for consumers to learn about their brands and products, according to Yahoo!.
Mr. Greene's advice to small dealerships is to get their Web sites in order and invest in the sites so they function well, provide local customer feedback because ``testimonials go a long way'' and provide information on local store events and sales.