PREFACE

Without research projects, management education is meaningless so long with the theory;
research projects are provided to management students to expose them to the actual working
environment . Such researchs provide a framework of knowledge relating to the concepts and
practices of the assigned topics in the organization.

The researchs are the integral part of the course curriculum of Masters of Business
Administration (M.B.A). In this the student is in the position to analyze the EXTERNAL
ENVIRONMENT of an organization with mature eyes and understand the dynamics in a much
better manner.

APPROVAL
I have completed this study under the able guidance and supervision of Lect. MANU KALIA ; I
will be failed in my duty if I do not acknowledge the esteemed scholarly guidance, assistance and
knowledge. I have received from them towards fruitful and timely completion of this work.

Mere acknowledgement may not redeem the debt I owe to my parents for their direct/ indirect
support during the entire course of this project.

LECT. MANU KALIA

LSM (L.P.U)

DECLERATION
I, Mukesh Rihan, student of M.B.A 1st sem (regn. No. 11010012) in Lovely
Professional University; Hereby declare that I have completed my research report
on the topic titled “CUSTOMER PERCEPTION REGARDING INTERNET
ADVERTISING”

As a part of my course curriculum.

The information provided in the report is original and has not been copied from
anywhere.

This report is not submitted to any other university/Institute for the award of any
other degree/ diploma.

MUKESH RIHAN
MBA 2ST SEM
Roll: RS1003 B-44

ACKNOWLEDGEMENT
The completion of this research endeavor would not have been possible without the assistance of
so many. I am genuinely thankful to my thesis advisor lect. MANU KALIA for her support,
guidance, encouragement, and enduring patience and I am tremendously grateful for the support,
advice, and motivation.
My appreciation to Vikram, Gourav, Gagan, Anil, Farhaaz, Shashank and Subodh, for your
great assistance, with this research since the beginning; and the everlasting friendship of you
guys.

Last, and most importantly, my heartfelt thanks to my family , I couldn’t have gotten
through this without your support, and encouragement. Great big thanks to all My Teachers from
my childhood because they made me capable to be here. Who has helped me
All you guys brightened my day!

Mukesh Rihan
Jan, 2011
 INTERNET ADVERTISING

INTRODUCTION
The internet is a worldwide collection of thousands of interconnected computer networks, which
is used by millions of people daily. It is one place where one can do anything and everything such
as meet people, make friends, learn, teach, buy and sell. What one can do on internet is limitless,
what internet can do for you is also limitless. The only limit seems to be Engineers imagination.
So internet is lot more than just the Worlds biggest E- mail system or a place where computer
jockeys can get their jollies. It in fact is a powerful, low cost, open, standard based technology
platform. This global network stands to reshape the business model of the entire industry. There
is no one who can stop it. The internet business models are virgin territory, which means there is
a wonderful opportunity for entrepreneurs to apply their creativity. The internet will soon be so
universal, that it will be taken as granted as the telephone today. It will take computing to a new
plane where information and computing resources from all over the world will be at your
fingertips. The internet is a whole new world in cyberspace and the world wide net is a powerful
software scheme of the internet. The medium of World Wide Web is interactive which include
graphic images, photographs, audio and full motion video, elements that make locating and using
information fun and useful.

Today, as the market environment is getting more and more competitive, it has become extremely
important for a marketer to communicate and promote his offer to the potential consumers and to
retain them to sustain and survive in the market. Imagine building a business in a location where
everyone could see it and access it from anywhere at their convenience. You can quickly learn
what each customer wants most from your company and respond personally, improving your
customer relationships and gleaning more value from every account you win. Today, the internet
is making that vision possible, creating a nearly universal point pf connection between people,
businesses, and organizations, both large and small. It indeed is the best way of communication,
which is both cost effective and has a large reach. Using the internet, you have the potential to
reach more customers, introduce new products and services quickly and collaborate with
suppliers and partners as you work to expand your business. Internet is one of the various forms
of media for
advertising products and offers. The internet provides an unprecedented capability for sellers to
learn about their customers and offer custom products at special prices.

(http://www.webopedia.com/TERM/I/Internet.html,http://www.cnri.reston.va.us/what_is_internet.
htm)

INTERNET ADVERTISING

With the rapid expansion of the internet and the explosive growth of the World Wide Web as a
viable medium for communication and commerce, companies hoping to remain competitive into
the next millennium are faced with having to rewrite the rules of marketing. The Web began a
paradigm shift away from the passivity of TV/radio and its one way, “firm- to- consumer” model
of information delivery to a “many- to-many” interchange between the companies and
consumers. This represents a new interactive state in which consumers take control and have
access to all companies and products, utilizing the vast resources of the web. The problem facing
corporations today is that this shift to the web must be accompanied with a new marketing
strategy. Old ways of advertising, merchandising and providing service no longer meet the needs
of the ever-evolving internet consumer. The interactive features of the web enable people to
personalize their experience by choosing for themselves among its huge array of content. It is
against this overwhelming backdrop of information that today’s Advertiser tries to find their
customer and get the message to them. Internet advertisement has grown rapidly in a short span
of time and is expected to command an even larger portion of advertiser’s media budgets within
the next decade. Internet demographics are a marketer dream- net users are young, well educated
and earn high incomes. Web ad banners builds brand awareness and may be better at generating
awareness than television or print advertisement.

Advertisement seeks to disseminate information in order to affect a buyer- seller transaction.

Internet advertisement differs from other mediums by enabling consumers to directly interact
with the advertisement .a consumer can click with his or her mouse on the ad for more
information or take the next step and purchase the product in the same online session. Internet
advertisement also gives advertisers the opportunity to precisely target an audience, enabling
them to deliver ads that are customized to each user’s particular interests and tastes.
REASONS FOR INTERNET ADVERTING

1. Television Audience are Migrating to the Net

The erosion of the network television audience during the 1980s and 1990s changed media plans
forever. In the early ‘80s, television was simple to plan and buy with just three networks to
consider. Then came cable, then fourth network entries: paramount and the WB. New choices
continued to fragment traditional television viewing and advertising Ironic, isn’t it, that just 40
years ago television was considered “new media”?

And just 15 years ago cable wore the same badge. During their value to earn a spot on the media
plan-the same position the internet finds itself in today. Does internet advertising belong on your
media plan? This is the question everyone is asking. CEO’s are asking their brand managers.
Brand managers are asking their agency account managers are asking their media department.
The answer most certainly is YES – regardless of the brand you manage or the category in which
that brand competes. Look at the fact: budget soon followed this trend. Television recent history
has demonstrated that media budgets ultimately are pragmatic. As audiences migrate, media plan
follow, acknowledging that the ultimate goal of any brand is to reach the target audience
effectively and efficiently. The exploding media landscape of the 90s-driven by increased TV
audience fragmentation and web’s popularity-have put this process into overdrive. Like the 80s
and the early 90s, media planners are, again, adopting their plans to account for the ever-growing
numbers of people spending increasing amounts of time online at the expense of other media. The
first evidence of this audience migration appeared last summer in a Forrester research report.
Researches asked PC users which activities they were giving up to spend more time on their
computers. And, while 24% did admit giving up eating or sleeping to pound away on PC, that
activity sacrificed by over three-quarter of the respondents was television. Shortly after the
Forrester findings were published, a study from The Georgia Institute of Technology’s Graphic,
visualization and Usability center (GVU) was released. This study, conducted on the internet,
asked user about the television viewing habits and what impact the net might have on them. Their
finding indicated the distinct shift in media habits with almost 37% of despondence claiming that
they “use the web instead of watching TV on the daily basis.” Earlier this year, MSNBC noted
that the fact Nielsen’s February rating sweeps found one million fewer U.S. household watching
prime time television versus the same
period last year. Simultaneously, Nielson and Commerce Net released their internet study,
reporting that the North American Online audience had doubled in past 18 months. Clearly the
conclusions of these to studies are far from coincidence. Taken alone this migration of television
viewing audience to the internet is particularly striking. This data is made even more impressive
by the fact that internet users are remarkably upscale. So, not only are we witnessing a
fundamental shift in media habits, the internet audience represents that hard-to-reach, well
educated, high-income population most covered by marketers. (Davis, J. 2000. A Guide to Web
Marketing: Successful Promotion on the Net. UK: Kogan Page Limited. ISBN 0749431857)

2. The Net is the Fastest Growing Medium in History Internet advertising began in
1994, when the first banner ads were sold (hotwired, October 1994) and the first available web
browser, Netscape Navigator 1.0, was released (November 1994). In recent study, Mary Meeker,
managing director, Morgan Stanley, and her team of researchers closely examined the adoption
rate of the Internet, contrasted to the three other major “new media” invented this century: radio,
network television and cable TV. As a common metric, they examined the number of years it
took or will take for each media to reach 50 million U.S. users, with television, cable and radio
included for historical context, the growth of the internet is nothing short of remarkable. Meeker
estimates the Internet will capture 50 million users in just five years. It took TV 13 years and
radio 38 years to reach this milestone. (g.au/index.php/Online_Advertising_-
_Hishttp://wiki.media)

3. Internet Demographics are a Marketer’s Dream every major research organization

has studied the demographic condition of the Internet. While methodologies and approaches vary,
the findings are consistent: Net users are young, well-educated and earn high incomes. And,
increasingly, research shows that both men and women are using the Internet.
(http://www.allbusiness.com/marketing/advertising-internet-advertising/3974-1.html)

4. Web Ad Banners Build Brand Awareness and may be better at Generating

Awareness than Television or Print Advertising
Since their first appearance on commercial Web pages, the value of banner ads has been debated.
Many felt they were physically too small to offer much branding and some advertisers convinced
themselves that click-through was the only metric by which to measure ad effectiveness. In fall
1996, Millard Brown International set out to test the

impact of banners on brand awareness, the first study of its kind. Millard brown’s objective was
to measure the impact of a single ad banner exposure on brand awareness the findings were
remarkable. Single exposure to Web banner generated greater awareness than a single exposure to
a television or print ad. FORCE SCORE were used as means to evaluate the impact of the ad
banners relative to other media. (http://www.economist.com/business-finance/displaystory.cfm?
story_id=7138905).Every new medium has had to prove its value to advertisers. Initially cable
TV too had to fight to earn the respect of advertisers. Today it is a several billion industry. Those
of us in internet publishing realize that internet is no exception to this thing. All the above given
facts in aggregate create an undeniable compelling case for advertisers today to include the
internet in their media plans. As Lynn Upshaw, author of building brand identity noted that, “the
World Wide Web will be one of the strongest brand building tools available.” Based on the facts,
we couldn’t agree more.

(http://www.guardian.co.uk/media/2009/sep/30/internet-biggest-uk-advertising-sector)

HISTORY OF INTERNET ADVERTISING

1989 - Tim Berners-Lee invents the World Wide Web while working at CERN, the European
Particle Physics Laboratory. April 1994 - Andresen and Clark start Netscape. October 1994 -
Hotwired site launches with ads from AT&T, Sprint, MCI, Volvo, and others. Time-Warner
launches Pathfinder with test ads from AT&T. Roy Schwedelson delivers a speech on the
Information Superhighway at the Fall DMA conference in Toronto urging direct marketers to get
involved. November 1994 - CMP’s TechWeb is launched with ads from AT&T, MCI, and
Tandem Computers. Web Connect is designed based on a direct response marketing model. Roy
Schwedelson and Jay Schwedelson return from COMDEX with initial concepts on a banner ad
placement service. WebConnect advertising media kit is placed on the web detailing the program.
January 1995 - Prodigy is the first commercial online service to offer Internet access to its
subscribers. Vibe Online cuts deals with MCI, Saturn, Timex, Jim Beam and Air Walk for dollar
amounts ranging from $20,000 to $60,000. February 1995 -Grey Interactive is awarded the
Procter & Gamble account for handling web-based media’s aggressively pitches advertisers on $1
million charter sponsorships of its future Web site and additional online properties.CBS Web site
is launched. March 1995 - Yahoo!, a popular Web directory, transforms into a commercial
business. Modem Media is awarded the AT&T account for interactive media. Web Connect signs
up the "First 100" member sites to its advertising network: Home Education Resource Center, Art
Cellar Exchange, 'Vettes on the Net, Dale Carnegie Systems, Home Business Review, and others.
Ragu is identified as one of the first packaged-good marketers to establish a presence on the Web.
April 1995 - AT&T and Saturn take banner ads on Pathfinder at the cost of $30,000 per quarter.
Internet Advertising Council meets to identify goals, objectives and membership guidelines for
the newly-formed. June 1995 -Web Connect introduced to catalogers at the summer Catalog
Conference in Chicago. Over 60 business, consumer, and high-tech market categories from a base
of over 500 member sites are offered. July 1995 - Netscape and InfoSeek alter their pricing
model to accommodate cost-per-thousand impressions. August 1995 - MSN online service is
launched by Microsoft. Proctor & Gamble and Kraft register a combined 184 domain names to
secure their brand names in cyberspace. WebConnect places banner ads for Encyclopedia
Britannica. September 1995 - ESPNET Sports Zone acquires eight advertisers to contracts
totaling more than $1 million. October 1995 - In excess of 24 million adults in the U.S. and
Canada have access to the internet. Poppe Tyson spins off its web ad sales unit as Double-Click.
Whereas Web Connect took the path of traditional direct response marketing for Web ad sales,
DoubleClick adopts the Cookie technology which tracks a user's activities on the Web. Roy
Schwedelson, CEO of Worldata and founder of Web Connect, takes a strong position against the
usage of Cookie technology based on protecting a user's privacy. January 1996 - Microsoft
allocates and pays $200,000 for sponsorship of the Super bowl Web site. The New York Times
makes its entry into cyberspace with ads from Toyota and Chemical Bank. Net Gravity
introduced the Ad Server ad management system for Web sites. February 1996 - Focalink
Communications introduces the Smart Banner media planning service. PointCast launches an
innovative client-server application which delivers tailored content from the Web in the form of
an animated screen saver. April 1996 -Juno launches a free, ad-supported e-mail service. This is
shortly followed by a similar service from Free mark Communications. The Wall Street Journal
makes its entry into cyberspace. May 1996 - ivillage nets six-digit in advertising dollar
commitments based on a corporate philosophy of humanizing cyberspace with targeted online
communities. Market watch, a Web media planning tool, is introduced by FocaLink
Communications. June 1996 - Web Connect creates and offers accurate measurement tools to
advertisers. Private URL's created to track Impression and Click-Through rates. New ad
management technologies support animated GIF's, banner rotation, and CGI/Pearl scripting. July
1996 - An ad campaign featuring animated banners is launched by AT&T. As reported by
Intelliquest, 35 million U.S. residents accessed the Internet or online services during a three
month period. Web Connects family of participating member sites tops 1,000. August 1996 -
Microsoft says its aggressive plans will position them as the largest Web advertiser. Privacy
advocates heighten industry awareness on the invasiveness of the Cookie technology. The
delivery of free content to users of Microsoft's Web browser is agreed upon by major sites. Poppe
Tyson files for an IPO .September 1996 - GM expands its content to over 38,000 pages, making
it one of the largest sites to market products. October 1996 - CASIE issues proposed Web ad
banner guidelines. Prodigy Inc. takes the wraps off a long-anticipated Web-based version of its
online service. November 1996 - ONSALE, the Internet auction house for refurbished personal
computers, announces recorded monthly sales of $4 million.February 1998 - Hot Mail Corp.
announces that registrations for its service have passed the 2 million mark. A proposal submitted
by Bell Lab’s Information Science Research Center (RFC:2109) calling for new Cookie standards
is under review by the Internet Engineering Task Force, a major step towards protecting a user's
privacy. March 1998 - Yahoo! makes a minimum advertising commitment to Netscape of $25
million over two years. April 1998 - Time Inc New Media agrees to syndicate some Pathfinder
content on the Web site for the AT&T WorldNet Service. Microsoft Corp. announces it plans to
purchase WebTV Networks Inc. for $425 million.
(http://www.worldata.com/wdnet7/articles/the_history_of_Internet_Advertising.htm)

TYPES OF ADS

Banner Ads - Banner ads traditionally serve one of two purposes: branding or direct sales.
Branding means that the business just wants to get their name out there so that the consumer will
remember it later. This is the same strategy as billboard advertising. With direct sales; the
banner ad is attempting to get the consumer to take an action. This might be as simple as
clicking on the banner or it might mean calling a phone number or visiting a physical sales
location. In either case, banner ads have been shown to have limited effectiveness (thus the
reason for the drop in banner ad rates over the years). They are easier to ignore than a television
commercial, so their impact in branding is not as great. Also, direct sales research has shown
that for every 1,000 times a banner ad is viewed, only 2 to 5 people will actually click on it (and
those clicks don‘t guarantee a sale).

Unicast Ads - These ads pop-up and display something akin to a miniature television
commercial. The consumer can then click on the ad to learn more about the product or make a
purchase. So far, Unicast ads have proven very effective, and they are currently able to charge
rates approaching what banner ads used to.

Sidebar Ads- Sidebar ads are another answer to the question, “How does Internet advertising
work?” Also known as a “skyscraper ad,” these advertisements are positioned vertically on the
computer screen. Because of their vertical positioning, sidebar ads can be much larger than
standard banner ads. They also have more effectiveness than a banner ad because they cannot be
scrolled off the screen. As long as the consumer is on the page, he’ll have to contend with the
presence of the sidebar ad. The click-through rate is around 2 to 3 times greater than with
traditional banner ads.

Blogging -Creating a blog is simple and free. Once your blog is “live,” you’ll be able to post
content and direct readers back to your primary site. It remains to be seen whether or not
blogging is a passing fad, but it’s certainly popular as of this writing.
Pop-Up Ads - When you visit a page, a pop-up ad is one which literally “pops-up” in another
window. Most people hate these ads, as they immediately obscure what you were looking for.
However, they have proven more successful than banner ads, usually making the advertiser 4 to
10 times more revenue.

Search Engine Submission - This is done by simply submitting your site to search engines.
This works best with smaller search engines, and getting your site ranked can make a major
difference in the number of visitors.

Search Engine Optimization - Essentially, the SEO strategy revolves around getting your
website ranked as high as possible on search engines like Yahoo! and Google. The closer to the
top you can get, the more likely that someone will visit your page. This higher ranking is usually
accomplished by getting links from other sites and providing lots of unique content.

Text Links - These are simply links that a user can click on to visit another site. Often, the
owners of two different sites will agree to “swap links,” meaning that both install a link to the
other’s site. While the effectiveness may not be as great as paid advertising, it is a free way to
gain more exposure.

Floating Ads - When investigating the question, “How does Internet advertising work?” we
must also look at floating ads. When you visit a website, these ads will appear on the screen like
a pop-up and then drift or float for anywhere from 5 to 30 seconds. Floating ads have been
successful largely because they obstruct the user’s view and force him to pay attention. While it
can be annoying for the consumer, the results simply can’t be denied. On average, a floating ad
will generate 30click-through for every 1,000 impressions. As a result, floating ads often charge
as much as $30 for every 1,000 impressions.
(http://www.askdeb.com/internet/advertising/work/)

INTERNATIONAL SCENARIO OF INTERNET ADVERTISEMENT

Interactive Advertising Revenues to Reach $147B Globally, $62.4B in US

The global advertising market reached $600 billion in 2007 and will grow at a compound annual
growth rate (CAGR) of 2.7% to reach $707 billion in 2012, propelled in large part by growth in
the interactive segment, according to a new report from The Kelsey Group. Interactive
Advertising Outlook - Interactive advertising revenues will increase significantly: from $45
billion in 2007 to $147 billion globally in 2012 - a 23.4% CAGR - according to “The Kelsey
Group’s Annual Forecast (2007-2012): Outlook for Directional and Interactive Advertising.”

Global forecast: Interactive advertising, which comprises search (including local search), display
advertising, classifieds and other interactive ad products, grew its share of global advertising
revenues from 6.1% in 2006 to 7.4% in 2007. By 2012, the interactive share of global ad
spending will reach 21%, Kelsey Group analysts expect.

US forecast: During the forecast period (2007-2012), the US interactive advertising revenues are
expected to grow from $22.5 billion to $62.4 billion (a 22.6% CAGR); interactive revenues in
Canada are forecast to increase from $1.3 billion to $3.3 billion (21.3% CAGR). Directional
Advertising Outlook :The Kelsey Group forecasts that directional advertising - comprising local
search, print Yellow Pages and Internet Yellow Pages (IYP) - will grow from $33.3 billion in
2007 to $41.4 billion globally in 2012 (a 4.5% CAGR).

Global forecast: The global outlook for each of the three key segments of the directional media
market during the forecast period (2007-2012): Local search revenues will grow from $2.1 billion
to $6.6 billion (a 25.5% CAGR). Print Yellow Pages revenues will decline from $27.5 billion to
$25.6 billion (a -1.4% CAGR). IYP revenues will grow from $3.7 billion to $9.2 billion (20.1%
CAGR).

US forecast :During the forecast period (2007-2012), in the United States directional advertising
revenues are expected to grow from $16.4 billion to $18.8 billion (a 2.8% CAGR), while
directional revenues in Canada increase from $1.4 billion to $1.9 billion (a 5.8% CAGR).

Canada forecast: Canada is one of the markets in which The Kelsey Group expects growth in the
print Yellow Pages segment, forecasting a 1.8% CAGR for print directories in Canada during the
forecast period. “Directory revenues are expected to decline in most global markets over the
forecast period, though print will remain the most important source of leads for small businesses,”
said Charles Laughlin, SVP and program director, The Kelsey Report, and managing editor, The
Kelsey Group. “For directory publishers to succeed, they will need to invest time, energy and
resources in both channels to minimize the decline in print and maximize the opportunity online.”
About the forecast: (http://www.marketingcharts.com/direct/interactive-advertising-revenues-to-
reach-147b-globally-624b-in-us-3567/tkg-internet-advertising-forecast-global-2007-2012jpg/)

INDIAN SCENARIO OF INTERNET ADVERTISING:

As more Indians go online, a boom in the Internet advertising industry is waiting in the wings
with the digital medium poised to rule over all other media in the coming years, say experts.With
over 49 million Internet users, the country’s online advertising market is expected to surge to
Rs1,100 crores this year registering a growth rate of almost 50%, estimates Internet giant
Google.Due to its reach, impact and cost effectiveness, web advertising is fast becoming a
preferred choice for most companies, cutting across segments.“Keeping in view the rapid changes
in technology, the trend obviously is moving towards the digital media. It is an alarm for
advertisers to explore this wide platform and reach specific target audiences. A boom in Internet
advertising is just waiting to happen as connectivity improves with the wider use of broadband,”
Narasimha Jayakumar, Business Head, Google India said.With higher adaptability to
technological changes the growth of Internet is predominantly driven by youth, who also form a
major chunk of the advertisers’ target segment.Pointing out to mature markets like the UK, where
the market share of online advertising crossed that of print media advertising this year, Harish
Bahl, CEO, online advertising agency Quasar Media, says the digital media is all set to rule in the
coming years.“There is no doubt that the digital media will reign supreme in the coming years.
And that is why all large advertisers are making a beeline on the Internet,” he says.Scoring over
traditional medium, particularly the print and television, the digital medium offers various
advantages like precision targeting, measurable ROI (Return on Investment), low entry-level fee
and global reach.“Added to all this is the fact that this is the only medium that lets one build long
term relationship with the consumer, get their feedback and talk to them at various stages across
the consumer value chain,” says Harminder Kaur, Chief Strategy Officer, Ignitee Digital
Solutions, a Mumbai-based Internet marketing agency.According to a study by the Internet and
Mobile Association of India (IAMAI), education and automobiles are the only two sectors which
seem to be making the most of the online advertising space.“Online ad spending by educational
institutions is expected to grow by 76% this year. Following this, automobile sector is expected to
show the second highest growth rate of 46%,” says the report Big corporate like Coca Cola, HUL,
Pepsi, Hyundai and ICICI are already dedicating considerable advertising spends on the online
medium.After YouTube’s tie-up with IPL for live streaming of all cricket matches, mainstream
advertisers like HSBC have also come on board.“The new media is bringing about a revolution
by merging the functionalities of customer end terminal devices like TV, PCs, mobile phones etc.
The advent of 3G can fuel the convergence phenomenon by making the mobile phone a very
handy tool for accessing video and audio formats,” says a recent FICCI-KPMG report on the
media and entertainment industry.However, online ad spending is estimated to constitute only
about 3% of the total advertising spend in India.“If we look at the sectoral view, online ad
spending is much higher. For the travel and e-commerce sector, online spends are already more
than 60% of all advertising spends. Also for the auto sector, advertiser spends on the online
medium this year is expected to between 8 to 10%.” says Google official.Marketers are also of
the view that the Internet has evolved itself to be an independent medium and cannot be seen
merely as a platform to raise awareness levels or supplement other forms of marketing
activities.“Internet advertising is already an independent medium and its importance is
increasingly being realised by all marketers as we move towards adopting a 360 degree approach
in marketing,” says Jayakumar.Subho Ray, president, IAMAI, however, says the Internet works
best when complementing other media.“No medium can be independent. But we feel that in any
media planning, online should take the lead and other media planning should be based on that.
Cross-media researches show how brand awareness and positive attitude towards brands have
seen positive shifts when Internet is used to supplement other mass media activity,” says
Ray.Industry experts say there are some issues like low penetration level of Internet services and
slow connectivity which act as hurdles in the growth of web advertising.“Also, the industry also
needs to come up with a credible measurement system for analysing online advertisement data,”
suggests Harish Bahl, Quasar Media.(http://www.livemint.com/2010/03/29110730/Internet-
advertising-boom-next.html)

NEED FOR THE STUDY

The need of study has aroused by seeing the importance of internet. Previously people used to
buy the products physically and barter system used to prevail everywhere. But now people have
stared using internet as a media for purchasing and also for advertising. It is the latest world of
the companies, gold mine of the future and mother of all networks. Internet is a worldwide
collection of thousands of interconnected computer networks, which is used by millions of people
daily. It is one place where one can do anything and everything. One can meet people, make
friends, learn, teach, buy, sell, watch preview of a movie, download the latest stock market report,
even send and receive one’s mail through E-mail. What one can do on internet is limitless, what
internet can do for you is also limitless. The experts say that the internet will soon be so universal,
that we will take it for granted as we do the telephone today. The net will take computing to a
new plane where information and computing resources from all over the world will be at your
fingertips.

Moreover,” Most of today’s marketing is moving from the market place into cyberspace”.
Demographics and lifestyles changes have transformed homogeneous mass market into
personalized, one to one interactions. During the final decade of the 20 century, marketing
became the cutting edge tool for success on the internet. Marketing continues to perform its
function of bringing buyers and sellers together; it just does it faster and more efficiently than
ever before. With just a few ticks of clocks and a few clicks of a mouse, the internet
revolutionizes every aspect of life. With a computer, a virtual market place is open twenty four
hours, seven days a week to provide almost everything anywhere to anyone. The internet provides
new ways for consumers to learn about and acquire products and services online. For instance,
internet provides consumers access to rich information sources and thus help them to make better
informed decisions.

REVIEW OF LITERATURE

This chapter deals with the review of different studies and researches which directly or indirectly
relate to the topic under study. In this chapter the review of various studies in the context of the
research problem is given in concise
 Littlejohn, (1996) has analysed Uses and gratification theory focuses on the receiver of
the message rather than the message itself. In mass communication, the theory gives individuals
control over media choices and uses. It contends that audience members are discriminating media
consumers and examines consumer behaviour based on individual experience. Media consumers
are viewed as active users of content, not subjects being manipulated (as assumed under early
theories of mass communication). The theory holds that how an audience member chooses to use
a message is an intervening variable in the message effect

Prabhakaran, P. (1984) has analyzed the characteristics and advantages of internet

advertising in India in his study “is advertising worth in India”, This media has low cost per
thousand (CPM) readers, high flexibility and reach. The complex and lengthy messages can be
easily advertised. The advantages include mass impact, mass converge, repetition, flexibility and
prestige while the disadvantages include relinquishing control of advertising messages to the
telecaster who can influence its impact. High morality rates for ads are some evidence of public
distrust.

Gullen and Johnson (1987) found that web advertising plays an important role in
attracting new respondents to the site, its influence on great repeat purchasing behavior is less
visible in the short term and the share of 40% is sufficient to attract new buyers, although this
may follow as consequence of absolute levels of web advertising.

Denison (1995) has given the specific objectives of web advertising. First is reminding the
existing users because constant reminders through ads can enhance the company reputation and
standing and play their part in commenting customer loyalty. Second is reminding constantly to
the customers the product characteristics and advantages, providing the prospective customers
about the new developments in the product.

Leckenby and Kim (1996) Analyzed the internet ad impact in non metropolitan markets
and suggested that the internet was an important communication medium to non-metro audiences
and non metro internet market is an extensive and of high economic quantity. Advertising
exposure is high and advertising contents are widely read and persuasively effective. Two
important implications from this study were first advertisers would be unwise to ignore the non-
metro internet audience which was of high quality and
second the advertising should be designed in accordance with the perceived characteristics of
media.

Kantor and Neuberth (1996) suggested that advertisers should provide qualified, targeted
visitors to online businesses in order to achieve the highest market potential for their products and
services. By employing custom, strategy combinations of interactive marketing services that
integrate into any online or offline campaign, clients can connect to their target audience-
providing enhanced branding and target customer acquisition costs. Work with marketers should
be done to build valuable relationships with consumers. By leveraging experience and
technology, clients will be benefited from increases in both traffic and conversation. Online
marketing services should be tailored to be synergetic with each other, and effective to clients
needs.

Mcdonald, S. (1997) is of the opinion that web advertising subsidizes the cost of
producing Medias which provides the means to advertisers to teach the prospective buyers. He
says that none of the existing media vehicle (internet, newspaper, magazines, TV) is the best as
all of them have inherent advantages and disadvantages. The criteria to differentiate one media
vehicle from the other are as follows:-Selectivity: the ability of the media to reach the particular
audience, based either on audience basic geographic location or unique traits. These may be
demographic or psychographic in nature, Coverage: the nature of audience a media can reach.
Coverage refers to the degree with which a media can penetrate a market hence internet is the
bets medium for coverage as it covers a large geographic region, Cost: cost refers to the charge
imposed for buying a certain amount of time or space. In the relative sense what the medium
yields in terms of audience quality and quantity and in terms of results obtained for the money
spent. Internet is the best medium according to the cost as very less is charged.

Shapiro, AL. (1999) researched on the issue of, “The Internet”. The author says that
Information Age gurus claims the internet will alleviate global poverty, empower individuals,
revolutionize commerce, and spread the light of democracy to far corners of the globe- so long
as governments keep their hands off. Think again. Without careful regulation, digital technology
may devastate low income communities and eliminate personal privacy. And repressive regimes
may harness the internet to increase their power over the people.
 Shapiro, AL. (1999) researched on the issue of, “The Internet”. The author says that
Information Age gurus claims the internet will alleviate global poverty, empower individuals,
revolutionize commerce, and spread the light of democracy to far corners of the globe- so long
as governments keep their hands off. Think again. Without careful regulation, digital technology
may devastate low income communities and eliminate personal privacy. And repressive regimes
may harness the internet to increase their power over the people.

Gupta, P. (2000) Suggested that web was more effective at communicating an advertising
message than any other form of media. The difference in communication effectiveness appears to
be linked to the self-selective characteristics of web viewing, which regulates the amount of
attention a person pays to advertising carried internet medium. He suggested that at extremely
low use/purchase probabilities the effectiveness of web advertising approaches zero and the web
becomes a more efficient choice of advertising media as the use/purchase probabilities increased
the economies of reach.

Stewart, DW. and Zhao, Q. (2000) the authors examine the role of the internet in
marketing in the context of business models that are economically viable. This examination raises
questions regarding the degree to which internet is genuinely different and whether it will be a
boon to consumers and investors. Economic necessity associated with the need to obtain and
maintain profit streams suggests that internet markets will likely be more similar to than different
from traditional markets. The authors challenge assumptions regarding the role of the internet in
creating frictionless markets that benefit consumers and the role of personal information and
privacy on the internet that are necessary conditions for potentially profitable business models.

Hansen, JV. (2001) researched on the internet commerce security and summarized that
implementation and maintenance of IC controls is an issue of great importance that will grow in
concern as more business applications move to the internet. These concerns will become more
complex as software is implemented that facilitates alliance among businesses, where exchange
of information is an important strategy. His paper has discussed some current IC control problems
and has outlined and referenced some current models and approaches that may be useful.
 Geyskens, I. et.al (2002) Using an event-study methodology, the authors assess the net
impact of adding an internet channel on a firm’s stock market return, a measure of the change in
expected future cash flows. The authors find that, on average, internet channel investments are
positive net-present-value investments. The authors then identify firm, introduction strategy, and
marketplace characteristics that influence the direction and magnitude of the stock market
research. The results indicate that powerful firms with few direct channels are expected to
achieve greater gains in financial performance than the less powerful firms with broader direct
channel offering. The authors also find that internet channel additions that are supported by more
publicity are perceived as having a higher performance potential.

Pattern, DM. (2002) Theories of corporate social responsibility suggest that there ought
to be a balance between what businesses takes from society and what it gives back in return. The
study examined whether insurance firms themselves reflect this emphasis, or whether companies
that are industry leaders with respect to web innovation for product marketing are also leaders in
using the web for information disclosure. A study

of web pages for 40 property and casualty firms showed that financial disclosure of social
responsibility information on these pages was quite low, on average. Further, and importantly
from a social balance perspective, the web innovators in terms of product

marketing are not industry leaders in terms of information disclosure.

Shankar,V.et.al (2002) this study investigates the consumer welfare implications of

observed price levels and price dispersion in electronic markets. Despite claims that electronic
commerce lowers search costs dramatically, and therefore makes it easy for consumers to spot the
best buy, empirical studies have found a substantial degree of price dispersion in electronic
markets for consumer goods. The authors examine the consumer welfare implications of changes
in the structure of electronic commerce markets employing comprehensive datasets on e-tailer
prices and services collected from BizRate.com in November 2000 and2001. The authors find
that price dispersion decreased substantially between these two periods, and that measured
differences in e-tailer services bear little relation to e-tailer.
Afuah, A. (2003) His paper outlines models that can be used to explore the impact of the internet
on firm boundaries. The model suggests that the emergence and diffusion of the internet will
reduce boundary-determination costs—component production, transaction, system production,
and bureaucratic coordination costs-and thereby either shrink or expand firm boundary. Whether
it shrinks or expands firm boundaries is a function of transaction and production cost
determinants, the information dependence and tacit ness of value added activities, and
organizational technology. since the internet is an information technology, and most businesses
have an information content, its impact on firm boundaries is only one of the many questions that
researchers might explore.

Lim, KH.et.al (2004) The authors identified 2 national culture dimensions,

individualism-collectivism and uncertainty avoidance, and their interaction that influences
internet shopping rates across a wide spectrum of countries. Together, these factors accounted for
14% of the explained variance (on top of the combined variance of 63% explained by national
income level, educational level, economic growth rate, unemployment rate, and crime rate) in
predicting internet shopping rates. For countries lower in uncertainty avoidance, individualist
cultures show higher internet shopping rates than do collectivist cultures. Further the authors have
discussed implications for national and internet firm level web design strategies.

Freestone,O.et.al (2004) researched on the issue of, “generation Y Attitudes towards E-

ethics and Internet- related Misbehaviors”. Authors say that aberrant consumer behavior costs
firms millions of pounds a year, and internet has provided young techno-literate consumers with a
new medium to exploit businesses. The paper addresses Internet related ethics and describe the
ways in which young consumers misdemean on the internet and their attitudes towards these.
Using a sample of 219 generation Y consumers, the study identified 24 aberrant behaviors which
grouped into 5 factors; illegal, questionable activities, hacking related, human Internet trade and
downloading. Those perceived as least wrong were; “Downloading movie and music files from
the internet for free”. The consequences of these behaviors have implications for educators,
consumer policy makers and marketers.
RESEARCH OBJECTIVES

RESEARCH OBJECTIVES: -

The study has been focused around the following objectives:

1) To analyze the overall perception regarding internet advertisement.
2) To find out the consumer’s perception towards different ads.
3) To study the customer perception regarding the advertisements.
4) To examine the effectiveness of internet advertisement.
5) To examine effective way of internet advertising.
6) To analyse factor effecting customer perception.
7) To study the scope of internet advertisement in India.
8) To suggest various factors to increase sales.
RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

It is well known fact that the most important step in research process is to define problem. Choose
for investigation because a problem well defined is half solved. This is the reason that at most
care was taken while defining various parameters of the problem.
DATA SOURCE
Research include gathering both primary and secondary data.
Primary Data : - primary data are originated by a researcher for the specific problem at hand.
Primary data the first hand data, Primary data is crucial to know various customers and past
consumer views about laptops and to calculate the market share of this brand in regards to other
Brands.

Secondary data : - secondary data are those which have been collected by some one else and
which already has been taken from internet , newspaper, magazines and companies web sites.

RESEARCH APPROACH

The research approach used survey method which is widely used method for data collection and
best suited for descriptive type of research survey includes research instrument like questionnaire
which can be structured and unstructured. Target population is well defined and various methods
like personal interviews and telephone interviews are employed.

RSEARCH DESIGN : -

DESCRIPTIVE
Descriptive studies are well- structured, they tend to be rigid and its approach cannot be changed
every now and then. Descriptive studies can be divided into two broad categories.
• Cross sectional
 • Longitudinal

Desriptive studies are undertaken under many circumstances :

• When the researcher is interested in knowing the characteristic of certain groups such as
age, educational level, occupation or income.
• When the researcher is interested in knowing the proportion of people in a given
population who have behaved in a particular manner, making projections of certain thing.
• Or when he wants to determine the relationship between two or more variables.

The objective of this kind of study is to answer the “ who, what, when, and how, of the
subject under consideration.

I will be taking DESCRIPTIVE because my research includes knowing the perception of

customer toward laptops, i will be working on to know how people respond to advertisement.

SAMPLING TECHNIQUE
Convenience sampling: - convenience sampling as the name implies is based on the
convenience of the researcher who is to select sample. This type of sampling is also called
accidental sampling. As the respondents i the sample are included in it merely on account of
their being available on the spot where the survey is in progress thus researcher stand at a
prominent point and interview all those or selected people who pass through that place. A
Surveys based on such a sample of respondents are not representative of population. It is not
possible in convenient sampling to know the “representativeness” of the selected samples.

I will be choosing convenience sampling because I will select respondant from L.P.U and
near households and interview selected people who pass through that place.
Universe/Population of study:

Population- Respondents of Jalandhar

Sample Size -100 Respondents

Sample Design – Convenience sampling. The survey has been done in a convenient way by
visiting nearby households, students and professionals.
Data Analysis –Analysis was done using Percentage and Weighted average method.

Percentage Method-

Here, the frequency of selecting a particular option is divided by number of respondents and
multiplied by 100 as follows:

Percentage= (f/N)*100

Where, f= frequency of selection of a particular option

N= number of respondents

Weighted average method:

In this method, specific weights have been predetermined and allotted on the basis of statements
on likert scale (For e.g.)

5= strongly agreed

4= agreed

3= neither agree not disagree

2= disagree

1= strongly disagree

Then, these weights have been multiplied by frequency of respondents considering a particular
point on the likert scale and the summation of such products for all the statements is divided by
number of statements as follows:

WAS = [{∑fW}/N]

Where, F= number of respondents giving a particular rating to a statement

W= weights assigned to different ratings (e.g. 5, 4……1)

N= total number of respondents

LIMITATIONS OF THE STUDY:

1. The sample size taken is small and may not be sufficient to predict the results accurately
and hence the findings may not be generalized on the basis of the behaviour of the
respondents only in Jalandhar city.
2. The present study is based on various students, household, professionals in city and hence
results cannot be applicable to other parts of the country.
 3. Results are based on the data collected and hence researcher is not responsible for wrong
inferences which may be due to wrong filling of questionnaires or wrong understanding of
subject about questionnaire.
Despite these difficulties, i tried my best effort to give a true picture of consumers’ preferences
for internet advertisement.

TYPE OF QUESTIONS

OPEN-ENDED: They give the respondents complete freedom to decide the form, length and
detail of the answer. Open questions are preferred when the researcher is interested in knowing
what is uppermost in the mind of the respondent.

DICHOTOMOUS: These questions have only two answers in the form of ‘yes’ or ‘no’, ‘true’ or
‘false’ etc.

MULTIPLE CHOICE QUESTIONS: In the case of multiple choice questions, the respondent
is offered two or more choices. The researcher exhausts all the possible choices and the
respondent has to indicate which one is applicable in his case.

REFERENCES

 Afuah, A (2003), “Redefining Firm Boundaries in the Face of the Internet: Are Firms Really
Shrinking?” ‘the academy of management review’, Vol.28, No.1 (Jan, 2003), pp.34-53’.
http://www.jstor.org/stable/30040688
 Brian,T.Ratchford, Xing Pan, &Venkatesh Shankar (August 2002), “On the efficiency of Internet
Markets for Consumer Goods”
prices.bratchfo@rhsmith.umd.edu,vshankar@rhsmith.umd.edu,xpan@rhsmith.umd.edu
 Chang-Hoan Coho & cheon, HJ (2004), “Why do People Avoid Advertising on the Internet”.
‘Journal of advertising, Vol. 33, No. 4(winter, 2004), pp. 89-97’.
http://www.jstor.org/stable/4189279
 Douglas, Ching Shan Hui, “How to Facilitate Internet Shopping in Hongkong, An empirical study”.
‘Social Science Research Network Electronic Paper Collection’,
http://papers.ssrn.com/abstract=287997
 Freestone, O, Mitchell, VW (2004), “Generation Y Attitude towards E-Ethics and Internet Related
Misbehaviors” ‘Journal of Business Ethics’, Vol.54, No. 2(oct., 2oo4), pp.121-128.
(http://www.jstor.org/stable/25123331)
 Hansen, JV (2001), “Internet Commerce Security: Issues and Models for Control Checking” ‘The
journal of the operational research society, Vol.52, No.10 (oct., 2001), pp.1159- 1164’.
http://www.jstor.org/stable/822797
 Inge Geyskens, Katrijn, and Gielens (2002), “The Market Valuation of Internet Channel
Additions”. ‘The journal of marketing, Vol.66, No.2 (Apr., 2002), pp.102-119’.
http://www.jstor.org/stable/3203417
 Lim, KH, Leung, K, Sia, CL and Lee, MK (2004), “Is e-commerce Boundary less? Effects of
Individualism- Collectivism and Uncertainty Avoidance on Internet Shopping”. ‘Journal of
international business studies’ Vol.35, No. 6(Nov., 2004), pp.545-559’.
http://www.jstor.org/stable/3875238
 Pattern, DM (2002), “Give of take on the Internet: An Examination of the Disclosure Practices of
Insurance Firm Web Innovators” ‘Journal of business ethics, Vol.36, No.3 (mar., 2002), pp.247-
259’. http://www.jstor.org/stable/25074710
 Randoph E.Buckli & Catarina Sismeiro, “Advances in Click Stream Data Analysis in Marketing”.
‘rbucklin@anderson.ucla.edu’.
 Stewart, DW and Zhao.Q (2000), “Internet Marketing, Business Models and Public Policy”.
‘Journal of public policy and marketing, Vol.19, No.2 (fall, 2000), pp.287-296’.
http://www.jstor.org/stable/30000634
 Shapiro, AL (1999), “The Internet”. ‘Foreign policy, No. 115(summer, 1999), pp.14-27’.
(http://www.jstor.org/stable/1149490)
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