Archive for April, 2010

Cost Effectiveness Of Internet Advertisement

Wednesday, April 21st, 2010

How effective is Internet Advertisement?

This topic aims at giving a short argument on the cost effectiveness of internet advertisement over the traditional method of advertising on electronic and print media. I decided to make this post because I observe that Nigerian Entrepreneurs are really not responding to the current shift from traditional advertisement on electronic media to internet advertisement. Many are still sticking to TV and Radio adverts despite the huge cost and the ineffectiveness of those media to capture the growing population of youth in Nigeria. With the advent of cheap internet connectivity in Nigeria, the youth are beginning to spend more time on the internet than they spend watching the local TV or listening to the local Radio stations.

It is an established fact that small and big entrepreneurs recognize the fact that effective advertisement can be a major determinant of a business’ success. Having a good product or service is not enough, such must be presented to the end consumer in such a way that their interest will be spurred up to give the product a trial. However, advertisement cost can be a real overhead-headache if not properly planned and managed. The cost of advertisement must be seen as a form of investment and the rate of return of investment must be pre-determined before implementation to ensure that the fund been expended on advertisement is justified.

An entrepreneur cannot be successful if he or she does not recognize the fact that human societies are dynamic. What worked yesterday may not necessarily work today. The mode of packaging and the advertisement media that were effective in the past decade are no longer holding their previous high rank. Gone are the days when TV and Radio advertisement were the most effective way of reaching consumers.

Advantages of Internet Advertisement

1. Low Cost Per Reach – This is the biggest advantage that internet advertisement has over the traditional advertisement via electronic or print media. The entrepreneur has several options that can be tailored to his or her peculiar business need. He can use text, audio, video, graphic or combination of one or two to package Affordable Internet Adverts targeted at a particular demography. The cost of such adverts will be based on response from potential consumers who are exposed to the internet advertisements. A good example of such is the opportunity provided by Google Adword whereby an entrepreneur can choose to only pay for adverts click by curious potential consumers. This can’t be compared to the cost of TV advert that is just a flat rate irrespective of impact on consumers.

2. Targeted Market – Internet Advertisement is best suited for having a laser target advertisement campaign that focuses on a specific category of consumer. It is easier to identify and provide adverts best suited for a particular demography when using internet advertisement. You can choose to show your internet advertisement to a particular continent, region, country, age group, class etc by using data already captured by search engines on the surfing habit of internet users. An entrepreneur may even have different sets of adverts to show to different categories of people. All these can be achieved without much effort and at an affordable cost. For example, you can choose to show a particular set of advertisement to those that are from the southern part of Nigeria while another set is shown to those that are from the Northern part of Nigeria. This is made possible by the data already captured by search engines.

2. Hassle Free Deployment of Advertisement – The advertisement project from Idea conception and packaging to the actual delivery of the advertisement can be outsourced. You don’t need to do it yourself if you don’t want to neither do you need to employ any staff to handle the tasks in house. The entire project can be handle online by a professional online marketing company. Also, the effect of the advertisement on your sales can easily be monitored from the comfort of your office or home. All you need is an internet connection via a computer or smartphone. Reports on advertisement performance is in real time. This makes it easy for you to judge in good time, which advertisement campaign is working and the one that is to be discountinued.

3. Advertisement Packages Can Be Updated Seamlessly – Unlike the electronic media advertisements that are difficult to change because of the cost implication, internet advertisement can be changed at minimal cost. Let use a practical example, if you make a video clip for a 60seconds advertisement on TV, the cost of producing the video clip will make it practically uneconomical for you to attempt to change the video clip one week after launch. However, for an internet advert, the cost of paying for new design could be negligible such that you can make changes to keep in tune with recent happenings. This particular advantage cannot be overemphasized. Internet advertisements are more flexible than any other form of advertisement.

Possible Disadvantages of Internet Advertisement

It won’t be fair to only point out the merit of internet advertisement without mentioning some shortfall that it presently have.

1. Market Scope – Presently, not all consumers can be reached via internet. Actually, there are some consumers that have no access to the internet yet, so such can only be reached via the traditional methods of advertising via the electronic and print media. For example, the lowest income group in Nigeria presently do not have access to internet. The average artisan in Nigeria towns and villages is not interested in taking his or her business to the internet because the consumers they serve have no business with internet. I can’t imagine the road side “roasted plantain seller” going to Google to advertise. Not that it is not possible to advertise “boole online” just that, the local consumer won’t search for “roasted plantain” in Google. They will simply search the street corners for “mama boole”. However, if Eko Le Meridian decides to place “boole” advertisement online while advertising its menu, it will yield positive result because their clientele consist of high income earners who uses the internet.

It therefore means that an entrepreneur must not embark on internet advertisement without first considering the audience he is targeting. Although most people now are into the use of technology, i.e. surfing the Internet, still, majority of the average consumers still relies on the old form of advertising as a means of gathering information about certain products and services, so an entrepreneur has to take this into consideration.

2. Need to Learn How Internet Advertisement Works – Without proper understanding of how internet advertisement works, an entrepreneur can run into huge overhead cost by employing internet advertisement wrongly. Even though an internet advert package cost $0.01 per click (N1.50 per click) that multiply by 1,000,000 clicks is a huge overhead that can wreck a small scale business.

Ignorance can be very deadly for a business online because things happens fast and often the effect of an error is irreversible. Before buying an internet advertisement package, get all the information you can and ask questions until you are satisfied that you understand fully what you’re getting into. You won’t want to have 1,000,000 clicks at $0.01 cost per click that produce $5 dollars worth of sales. That will be simply disastrous. But it does happen. Several online businesses have folded up because of such error. Never forget that little drops of water makes the mighty ocean. The internet has millions of users online, not all are useful to you. An advert package that attracts the wrong set of consumers will earn no revenue while at the same time it digs holes into your pocket. Never use the Nigerian idea of joining the bandwagon when deploying internet advertisement. You will only regret your action.

Summary

The aim of Internet advertisement is to offer the widest range or maximum exposure of your product or service at the least possible cost. That can only be achieved when you know what you’re doing. I strongly advice that you employ the service of tested professional firms with track records and good testimonials to handle your internet advertisement. That way the cost effectiveness of internet advertisement will be glaring as your business revenue soars. Cheers.

Outrageous Bank Charges!

Wednesday, April 14th, 2010

Outrageous bank charges in my account, this is unacceptable! It is not often that I make  a post because I’m angry. But this post, Outrageous bank charges was inspired by the activities of my banker that I just discovered this morning. I wasn’t planning to make any post today, but I got angry enough to hit my computer keyboard, because I’m definitely going to reclaim those bank charges or look for a better banker. Here is the story and I will be glad to read your opinion.

I got a cheque from a foreign firm who places adverts on this website (I do make money online you know). The cheque was for $125. Small amount I know, but that’s what makes the big bucks when it comes from different streams. Well, with excitement, I deposited the cheque in my domiciliary USD account with my banker, one of the famous Nigerian Banks (some are no longer famous, if you care to know why, read this post, .

The cheque was credited into the account and I went home smiling that in another 21days (well, from experience that is what it takes before a foreign cheque gets cleared into a Nigerian domiciliary account),  I will have access to the fund. However, I was shocked to discover when checking my account online the following day that the figure credited into my bank account has been reversed. A new figure for $100 was now credited! That was so confusing. I’ve never heard of such before. What manner of accounting is that? At least the cheque figure should be credited and then whatever charges the bank wants to make can now be debited into the account with explanation. Well, that wasn’t the case.

Careless me, I forgot to take the issue up (I guess I was too busy chasing more money online). I forgot all about the transaction until this morning when I discovered that I have been charged another $10.50 for the same cheque (21days is accomplished, the cheque from the foreign firm has cleared). Also, another $20 was charged as handling fees for sending the cheque from Nigeria to the foreign firms banker! For crying out loud, it is just a piece of payer, almost weightless! Isn’t this courier charge outrageous!

Anaylsis of The Outrageous Bank Charges

A quick analysis of all the charges got me angry. First, $25 charged for unknown reason, another $10.5 charged for unknown reason and finally $20 charged as handling fees. That means a total charges of $55.5 out of $125! That is a whooping 44% of the cheque value. So, while I labor tirelessly trying to make money online legitimately, my banker is sitting in the comfort of his office and taking out 44% of the proceed without my authorization. And nobody deemed it necessary to offer some explanation on why my internet business proceed should be divided between me and my banker in a manner I consider unfair.

My Reaction To the Bank Charges

If they had taking 10% or 20% of the proceed, maybe I would have been too busy to notice, but they took 44%. Of course, that was too much for me to forget. I paused my online business activity and made a franctic call to my account officer, ready to express my grievance. Unfortunately, he was not available to pick the call. That did not disuade me from making more effort, 44% of my earning can’t just end-up in the banker’s pocket without me putting up a fight. I quickly drafted an email and fired same with a note of urgency to the customer care service of my bank. It has been over 30 minutes since then, but there has been no respond. My account officer called back and I narrated the situation, he too promised to look into it, but there has been no response till now.

Nigerian Entrepreneurs Doing Business Online Please Help

Am I using a wrong bank?

Is this what other Nigerian Entrepreneurs doing businesses with foreign firms go through?

Was it stupid to have agreed that the foreign firm issue a cheque in settlement of the service I rendered?

What are the best steps to take when disputing bank charges?

Can bank charges be reclaim in Nigeria? I know it is possible elsewhere.

I need answer to this because it was not a one time deal. Another payment will be due soon. (I’m still making money online legitimately though I live in Nigeria!) The foreign firm does not use AlertPay, PayPal, is yet to remove Nigerians from her blacklist. So, what other options do you suggest for receiving money from this online business client?

This is not the first time am dealing with a foreign cheque. I’ve not really been careful to determine if the bank charges was fair or not. However, this particular incidence is a good starting point. I may not have noticed the outrageous bank charges if the cheque was for a five digit figure! I need your opinion on this, especially naija online entrepreneurs. Are you experiencing outrageous bank charges?

Update: Poll added based on readers demand (credit goes to Willo and McNeri) 😉

[poll id=”1″]

Note: You can choose up to 2 answers.