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Effects of Online Advertisement towards Newsprint Advertisement

Advertisement is a business term used to refer to any form of paid announcement for purposes of offering goods or services for sale through various medium including newspapers, television, magazines, radios, and on the internet. Advertisement can either take the form of print advertising through newspapers, magazines, brochures, and fliers. Alternatively, advertising can be in non-print form including television, radio, video, and internet. The key purpose of advertisement is to bring to the attention of potential customers about the existence of a new product or service.

A good advertisement should be able to persuade the potential customers to make purchase and keep them motivated to do a certain action (Tolani, 2010). While the function of advertising has all along not changed from the act of influencing the decision of a potential customer, the form of advertisement has gradually evolved with new advertisement media emerging. Radio advertisement emerged with the coming of radios in the 1920s. The number of people who owned radios increased to about 82% by 1940. Television was introduced in the 1950s and was soon a common item of nearly all households.

This saw television advertisement expenditure drastically increase to nearly $1. 5 billion by 1960s. Outdoor advertisement can be

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traced back to the post World War era to the American Safety Razor Company in 1925 when it advertised a brushless shaving cream on a mega billboard (Tolani, 2010). The advent of video cassette recorders saw a new trend in advertisement during the period between the early 1980s and late 1990s. The video cassette recorders became very popular with viewers, but video advertisement met a major hitch as viewers easily fast-forwarded through advertisements while watching tapes.

This compelled firms to resort to product placement in which their products were used in television shows and films. The latest media development in this field is the use of internet for advertisement. There has generally been an increase in computer ownership and the use of internet has rapidly grown. It might not be easy to predict the advertisement media that will be widely used in the future. However, it is an open fact that advertisement will continue to improve and strive to become more useful to businesses and to the consumer (Tolani, 2010).

Entrepreneurs and business managers are faced with the challenge of having to make a choice for an advertising media on daily basis. This is because the success of their establishments are greatly dependent on the ability of the entrepreneurs and managers to create product and service awareness, build their firm’s image and reputation, and generate sales leads and revenue. These efforts can only be realized by use of newspaper and magazine advertisement, radio advertisement, television advertisement, outdoor advertising, web advertising, among many other advertising media.

What will determine the final medium choice may vary from one business to another and the various factors that are in play towards meeting the specific business objectives (Patsula Media, 2007). Irrespective of the medium of advertisement that a business chooses to use for its products and services, it is important to note that both the print advertising and online advertising are very necessary given that the approaches towards both are very different, the purposes are different and even the audience are sometimes different.

It is not very advisable to consider one of these medium as more effective that the other on mere basis of seasonal variance, because either may overtake the other at some give time. A good number of people also have access to both sources and this makes it important for entrepreneurs and business managers to give due consideration to both (Web Windows, 2010). Thesis Statement

Given the increased growth of information that is available on the internet and the subsequent increase in the number of people who tend to spend more time on the internet, companies are turning to advertise for their goods and service online so as to capture this newly generated market. Emphasis has thus shifted to the possible effects that this emerging trend of online advertisement may have on newsprint advertisement both in popularity and advertisement revenue. 1. 1 Statement of the Problem

Advertisement plays a very important function in the trading processes as it is the only means through which a business can bring to the attention of the consumers about their products, introduce a new product in the market, or promote the sales of an existing product or service. All these are core activities without which a business setup cannot effectively compete for customers in the already crowded market. Though there are numerous media through which a business may place its advertisements, the most commonly used medium is the newspaper.

This is probably due to its wide readership and circulation. With the advent and advancement of technology, newspaper publishers have embraced information technology to an extent of presenting their publications both as newsprint and online versions. This advancement means that entrepreneurs have the option of choosing which version of a newspaper through which to place their advertisements. This will mainly be determined by an entrepreneur’s own evaluation of the medium that will best suit the business needs.

Lately, there has been growing debate about the popularity of online newspaper and newsprint. This debate cannot escape the attention of entrepreneurs who significantly rely on these news media for their advertisements. There is general consensus that online versions of newspapers are gaining popularity among readers worldwide. Could this increasing popularity to some extend translate into increased preference by entrepreneurs to place their advertisements online instead of the newsprint version of newspapers? 1.

2 Background of the Problem Given the central role which newspapers play in the advertisement of goods and services by businesses, it is only important that entrepreneurs give special attention and critical evaluation on the volume of readership and scope of circulation of both the online version and newsprint version of newspapers. This would mean that new considerations are factored in when making a choice for advertisement media by business contrary to previous emphasis that focused only on readership and circulation.

Ability to access an advertisement by potential customers is a major concern that attracts heated boardroom debates in companies particularly due to intense competition for the crowded market. The significance of an advertisement media with regard to scope of outreach means that both entrepreneurs and advertisement agencies have a responsibility to adopt the use of advertisement media capable of optimizing market outreach for a product or service. Key aspects for consideration with regard to choice of advertisement media are mainly in areas of target audience and access.

These mainly entail considerations of readership and circulation which would ensure that an advert reaches the highest number of target audience within the shortest duration possible and draws attention in the most appropriate way. While many entrepreneurs are coming up with several measures of ensuring they significantly save on advertisement costs for their products and services, advertisement agencies are of the opinion that optimizing market outreach can best be achieved by choosing a media with huge readership and wide circulation.

Key areas suggested by advertisement experts include impact and ability to attract attention amongst other adverts. When due consideration is given to these two aspects, an advertisement media will be able to achieve market outreach by approximately 70% which is equivalent to nearly 5% of the total product market in a crowded environment. It is generally agreed that upgrading of newspapers to online versions can help to significantly improve their readership and accessibility, translating to wider market outreach for online advertisements.

Such advancement in technology has for long been credited as significant part of increasing readership, expanding circulation, and making lasting impact in advertisement. The most remarkable gain for online advertisement can be attributed to the increase in number of people owning computers and therefore spending a lot of time on the internet unlike the numbers of people buying newsprint and the time they spend reading it. 1. 3 Justification for the Study

Effects of online advertisement towards newsprint advertisement is a welcome topic at this time when there is growing concern that newsprint advertisement is becoming less and less effective, in an environment where consumers are increasingly getting their information online and from other non traditional sources. This belief has also drawn a lot of objection from newspaper advertisement sales agent who insist that newsprint advertising is more effective than online advertising.

To them, newsprint advert is tangible making it possible for a potential customer to clip it out, hold in the hand and carry to the store unlike online advertisement which is only visual. Though online advertisement can cost a business slightly more, it is becoming more popular with consumers and can thus not be simply brushed off. This calls for a strategy that will ensure this advertisement medium is embraced without jeopardizing the profits of a business. 1. 4 Deficiencies in the evidence

The choice of an advertisement media that an entrepreneur or a business opts to use for its products or services are mainly determined by size of business and the target audience; whether they are other businesses, youth, elderly, men, or women. The access to an advert by these groups of persons is quite varied as all of them have their own preferences of media choices. The youth may be found of internet while the elderly may be accustomed to newsprint. While online advertising may make a big impact among the youth, it may not necessarily do the same with the elderly or housewives.

The size of a business will also play a big role in the choice of advertising media, for example, small businesses may not have all the money to invest in certain media which are considered expensive and are therefore a preserve for big businesses. Advertising is an expensive venture and may not be appealing or affordable to all entrepreneurs. This means that the choice of a media may not necessarily be determined by its effectiveness but rather by the investment capacity of any given entrepreneur.

Evidence obtained for this study will thus be influenced to a greater extent by individual entrepreneur considerations and not necessarily by the popularity of any given media. 1. 5 Definition of Terms Advertising Media: refers to means by which an advertising message is carried to potential customers and includes television, radio, internet, magazines, newspaper, and signage. Online Advertising: refers to advertising that is done over the internet. Newsprint Advertising: refers to placing advertisements on a newspaper. 1. 6 Purpose of the Study

The purpose of studying effects of online advertisement towards newsprint advertisement is to: 1. Ensure that entrepreneurs are provided with ample information regarding the various advertisement media to enable them make informed choices. 2. Ensure that myths revolving around effectiveness of either newsprint advertisement or online advertisement are eliminated, and substituted with live statistics. 3. Ensure that advertisement agencies are able to adjust their media in such manner that will enable businesses reach their target audience in the most effective way and at the least cost possible. 4.

Ensure that recommendations are made that would help entrepreneurs make choice on the most effective media for their advertisements. This study is significant in that it would help in ensuring that useful information is made available to help entrepreneurs with their advertisement decisions particularly those focusing on newsprint and online advertisements. It will also ensure that advancements in technology are embraced and advertising services evolve to best meet the opportunities and challenges of the future with regard to market outreach. 1. 7 Hypotheses The following hypotheses were tested in this study:

1. H01: Advertising plays a central role in business success. 2. HA1: Advertising does not play a central role in the success of a business. 3. H02: Most businesses advertise on newsprint media. 4. HA2: Most businesses do not advertise on newsprint media. 5. H03: Most entrepreneurs prefer to use online advertisements for their products. 6. HA3: Most entrepreneurs do not prefer to use online advertisement for their products. 7. H04: Newsprint advertising is more effective that online advertising. 8. HA4: Newsprint advertising is less effective than online advertising.

9. H05: Online advertising is the future of product advertisement. 10. HA5: Online advertising is not the future of product advertisement. 1. 8 Summary The shift in focus by entrepreneurs and businesses to put more attention on online advertisement instead on the traditional advertisement media is broadly seen as one of the main steps towards technological revolution of the advertising industry. This would go a long way in realizing wider market outreach and increased sales for businesses and publishers who embrace the internet for their publications.

This in essence would mean increased readership for online version of newspapers translating into bigger profit margins. This study has been designed to explore the various modes of newspapers as major advertisement media which can be used by entrepreneurs and businesses to advertise their products and services. Special focus has been given to Star newsprint and Star online which is Malaysia’s leading English publication. Chapter two of this work is an extensive literature review on matters relating to online and newsprint publications as well as online and newsprint advertisement.

Chapter three is an outline of data collection and treatment while chapters four and five presents study findings and discussions respectively. Chapter six outlines major conclusions and recommendations. Chapter 2: Literature review 2. 1 Introduction Newspapers have conventionally played a very significant role in the advertisement of goods and services. This has been mainly attributed to their wide readership and circulation since that can be easily obtained from the nearest street vendor to the biggest shopping mall in the biggest city.

The readership of newspapers also cut across all ages, sexes, and social classes as they normally publish articles that would in one way or the other are useful to all these category of persons. Newspapers have for long dominated the advertisement scene due to the low costs involved as compared to other advertisement media. Newspaper comes either as newsprint or online. Newspaper publishers have lately resorted to the two kinds of publication to meet the various demands of different readers (Mutter, 2010).

The introduction of online version of newspaper has seen a significant drop in the readership of the print newspaper, and this trend is projected to continue into the future. This scenario which is almost inevitable and probably irreversible is generating big concern on the future of printed newspaper as well as newsprint advertisement. The printing of newspaper remains very important for publishers since it is responsible for the biggest volume of revenue for publishers, contributing nearly 90% of the total revenue for a newspaper company.

Analyst are quick to point that any attempt to rid of print newspaper would simply through publication companies out of business since the advertising revenue will almost drop to 5% if not zero (Mutter, 2010). The continued survival of print newspaper will however to a great extent be determined by consumer demands, good state of an economy, and the interest of marketers to use newsprint advertising. It is predicted that with the diminishing economic prospects declining advertising revenue, there is a high possibility of a major drop in consumer demand for print newspapers.

This is based on the fact that close to half of print newspaper readers are aged population, who are statistically likely to pass out with time. The younger population is not found of print newspapers, and this habit will probably accompany them to old age. Unless this readership habit of the younger population changes, it is quite evident that the print newspaper readership will continue to shrink as the aged population slowly makes their exit leaving the younger population that has already formed a habit of not reading the print newspaper (Mutter, 2010). 2. 1. 1 Evaluation of Print Newspaper

Print newspaper has conventionally been associated with a number of advantages which have probably made it very popular. It is generally agreed that print newspapers have loyal readership, which makes it a powerful advertising tool as compared to internet. Print newspaper is considered very effective when a particular geographic area is being targeted, for example, when you want to notify people of about a forthcoming sporting event. For those who have information to convey, print newspaper is more flexible in terms of space as one is able to determine the size that would best suit his needs.

Certain print newspapers enjoy many loyal funs thus increasing heir readership (Lad, 2009). On the other hand, print newspapers have certain disadvantages. Print newspaper generally has limited lifespan, meaning they are only available to the public for a single day after which they are withdrawn from sale. Print newspaper may not give a wide reach as compared with internet that has a global audience. Print newspapers have the limitation in terms of the audience who may actually read it, and certain copies may actually not be available on demand at all times (Lad, 2009).

2. 1. 2 Evaluation of Online Newspaper Online newspapers tend to offer information to the reader much more quickly as compared to the print version. The online version is always available on the internet before the print version is on the streets. Online publications can normally be updated several times in a day with the latest news and happenings. While print version is purchased, online newspapers are accessed free of charge. This makes it possible for a reader to use a wide spectrum of newspapers possible.

Online versions enable users to make use of links to divide up large units of information into more easily digestible portions and searching information in the newspaper is also automated. Readers of online versions are able to archive articles on the computer, contact editors via e-mail, and use interactive games (Lad, 2009). The disadvantages attributed to online versions included the fact that they do not give detailed reports on all the subjects and tend to omit several sections found in the print version. This makes information available to the online reader very limited.

Reading from a computer does not convey the traditional experience of reading a newspaper which is a key characteristic of print newspaper. During peak times when several users are scrambling to access news, the download times are very long. Online newspapers are characterized by so many links which are quite confusing instead of being useful, particularly the amount of research necessary and the need to constantly check the link address. One gets tired looking at the computer screen and it may take time to get used to them (Lad, 2009). 2. 2 Case Study: Star Online and Star Newspaper

The Star is one of the leading English language newspapers in Malaysia. The statistics issued from the Audit Bureau of Circulation indicate that the print version of this newspaper has a daily circulation of nearly 950,000 copies while the Sunday Star records a readership of nearly 850,000. The publication is mainly owned by the Malaysian Chinese Association. The main competitors to this publication are The Sun and the New Straits Times which are also published in English. The Star newspaper traces its history to 1971 when it was first published as a regional newspaper in Georgetown.

By 1976, the newspaper had gained national circulation in Malaysia, and established its headquarters at the country’s capital, Kuala Lumpur. The growth in business saw the company relocate to Petaling Jaya were it is currently based (Star Publication, 2010). The company’s print newspapers, The Star Daily and The Sunday Star are published in five different editions. Two of the editions cover the northern peninsular states of Penang, Kedah, Perlis, Kelantan, and Perak. Two other editions cover the larger country.

The Star Daily is divided into sections consisting of the Main Paper, StarBiz, StarTwo, Star Metro, and classifieds section. The features of the Main Paper are predominantly local and international news. The StarBiz is mainly concerned with trade and reports on market trends, financial reports, and stock market updates. Star Two on the other hand mainly features articles on entertainment, environment, science, lifestyle, and fashion among several others. The content of Star Metro is varied and tends to focus more on the area of circulation (Star Publication, 2009).

The continued demand by the publication’s readers saw the emergence of The Star Online which is an internet version of The Star newspaper. This was in response to the persistent demand for an online version of the newspaper, and it finally made entry into the market in 2005. The company prides its strengths as a newspaper on the cornerstones of internet and media ventures. The Star Online and its many components are produced, managed, developed, and contributed to by the Star Division, The Star Online and Multimedia Newsdesk teams of The Star’s Editorial Department (Star Publication, 2009). 2. 3 Newsprint Advertisement

Advertisement can be traced to the emergence of trading activities from very early days as evidenced by archeological artifacts drawn from different parts of the world. With the invention of the printing press in 1440 by Johannes Gutenberg who was a German Goldsmith, merchant were able to duplicate advertisements for their wares. By the late 19th and early 20th century, newsprint advertising had become the primary means for companies to communicate their sales and promotions to the consumers. This was mainly through media such as newspapers, magazines, fliers, posters, and billboards (Walker, 2010).

Following the invention of the printing press, advertisements became a common place in weekly newspapers and periodical journals. The items which were mainly featured in such advertisements included new machines, other print publications, or reported the discoveries and inventions of the enlightenment era. The first newsprint to offer advertising space for sale was a French publication La Presse, in 1836. This saw this newsprint being sold more cheaply hence recorded increased readership and profitability. This move inspired other newspapers and magazines across the world to follow suit in this commercial strategy.

In the contemporary newsprint, advertising designers are able to visualize highly creative commercials through digital image manipulation in order to make the biggest market impact (Walker, 2010). Newsprints still remain key advertisement medium for every business to such a point that it is hard to imagine doing business without advertising in a newspaper or a magazine. This is particularly important for small businesses that can hardly afford other media of advertisement. Paid-circulation newspapers have for long dominated the mass media market for advertisement as reflected in advertisement sales volumes.

Newspapers are very popular with both multinational businesses and small-scale dealers. This is probably due to the fact that businesses come in three distinct forms namely local, regional, and national newspapers each targeting different audience according to its scope of circulation (Patsula Media, 2007). Advantages There are a number of advantages that print newspaper advertisements enjoy over online advertisements. Print newspapers enjoy very wide circulation as almost every home in the city enjoys daily access to a printed newspaper.

Where the advertisement is intended to reach audience only in a particular geographical region, print newspaper readily permits this. The printed advertisement enjoys both permanence and desired obsolescence. This means that a reader is able to refer back or even cut out a particular advert. Print newspapers have a predictable frequency of publication, either on daily or weekly basis making it possible for advertisers to target days of wider readership for their adverts (Brassil, 2010). The immediacy that print newspapers have makes it possible for urgent advertisements to be responded to fast, thereby producing urgent results.

When the deadlines are short, it permits quick responses to changing market conditions. Readers are already accustomed themselves to getting advertisements on print newspapers to an extent a good number buy print newspapers just to read adverts. At the same time, print newspaper reading has nearly become a habit for most people. Specific sector adverts can be very easily placed on the various sections of print newspaper such as sports, news, and classifieds to ensure the target is directly hit (Brassil, 2010). Print newspapers give advertisers a lot of flexibility both in size and placement.

This means that production changes can be easily responded to whenever need arises. Advertisements that are placed on print newspapers can be examined at leisure since the exposure is not limited, thus readers are able to take their time going through the message. Since placement on print newspaper can be tailored to a size that suits the budget of the advertiser, it is possible even for small businesses to place their small adverts at low costs. Print newspapers offer wide options to advertisers whether place their adverts as copy only, copy with graphics, colored, or black and white.

Finally, print newspapers features supplements which readers can easily pull out and save (Brassil, 2010). Disadvantages Advertising on print newspaper has not escaped its own set of shortcomings. Because of the large number of advertisements which are featured on the newspaper, any particular advertisement must compete for reader’s attention. This means that readers who only spend a few minutes reading the print newspaper may fail to capture the advertisement. At the same time, there is hardly a guarantee that everybody who reads the print newspaper will read the advertisement placed in it.

This is because a print newspaper has several sections and not all readers read every section of the newspaper. The short lifespan, normally daily that newspapers have forces advertisers to insert multiple adverts even for a whole week so as to reach a good number of readers. This may be expensive particularly for small businesses (Brassil, 2010). 2. 4 Online Advertisement The revolution in information and communication technology has come with both opportunities and risks for the business community, particularly from the point of view of the traditional established media.

Internet as a form of computer aided communication is equally unsure for the print media. The technical potential in advertisement that online newspaper offers surpasses that of the printed newspaper in several ways. Online newspaper is interactive, multimedia for providing internal and external networks, while offering a selection of functions, possibility for regular updates, access to archives, rapid access to large number of newspapers, and being paperless thus ensuring there is no problem of waste disposal (Neuberger et al. , 1998). Advantages

The economic constraints that businesses face on everyday basis often leave enterprises with very little money to spare on advertising. This is more common among the small businesses who often find themselves light in the pocket. It is therefore important to opt for an advertisement medium that give optimum output and minimal costs. Online advertisement is generally seen to be complacent in this line than the traditional newsprint advertisement. When online advertisements are on a pay-per-click basis, an entrepreneur only pays when a potential customer clicks on the advert and ends up on the entrepreneur’s website.

This ensures that businesses only pay for leads that end up in their web site as opposed to mass messages in the print newspaper that may or may not reach the target audience. There is therefore maximum return on investment for a business using online advertisement (Rogers, 2010). Online advertisement also works very quickly given the fact that the day that one gets started is the same day that results are manifest. There is basically neither a waiting period nor a long startup process. Once an entrepreneur is ready to get started, he can very easily launch a successful advertisement promotion on a number of channels.

This tends to produce quick results and the campaign can also be maintained for a longer period of time unlike print newspapers which have daily lifespan. Online advertisement enables businesses to target their markets more efficiently that print newspapers. This can be achieved through the use of social networks that an entrepreneur considers relevant to the campaign. Once these social networks are identified, a business can dig very deeply into their niche making them able to produce the maximum results with very little investment (Rogers, 2010).

Advertising online has the advantage of giving elaborate and thorough statistics that enables a business to tweak and optimize their campaigns to the maximum. This is a total deviation from newsprint advertising when one can do very little to track the success of one campaign as compared to another. Online advertising makes available quite a number of information just at a mouse click. With online advertising, an entrepreneur is able to monitor the number of people who visit the business website, where they come from, what they did once they were there and many other details.

Online advertisement also allows for full control and analysis since one is able to manage how many times to show up in the search engines, thus make it possible to gain huge returns for the business (Rogers, 2010). Disadvantages One key disadvantage that is associated with online advertisement relates to advertising overload. There is incredible amount of clutter on most web pages. This arises from the fact that every advertiser tries to draw the attention of web viewers making readers have access to too much information which they can hardly digest.

Under these circumstances, the web viewers normally choose to ignore the advertisements and this will lead to low rates of return. Online advertisement is also still a new concept for many advertisement agencies which simply cannot tell just yet which advertising method works best (Rogers, 2010). Chapter 3: Methodology 3. 1 Introduction In research undertaking the methodology section is one of the crucial areas to be tackled in a proposal document. This is due to the fact that it forms the basis of the results of research findings.

A research can be faced with big challenges due to a wrong choice of the method to be used. To avoid this, good planning of the method is essential and more in order to get reliable results. The issue of reliability establishes that a research should have the ability to show consistency in the results even after a study is done by different researchers repeatedly. Reliability in research study can also be enhanced through good structure of the methodology. When the correct data collection methods are used, proportional samples are collected and the correct method of analysis is used, a research can achieve validity.

Since this thesis is of an inductive nature, it prompted the application of a qualitative methodology. That means that the views of newspaper publishers and advertisement experts have been given a lot of weight. This was done by administering both physical and online questionnaires as well as conducting in-depth interviews each lasting nearly 45 minutes. Those interviewed had to be newspaper publishers, advertisement agencies, and general newspaper readers in Malaysia who have been in the sector for at least the las

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