Do Animated Banner Ads Hurt Websites? the Moderating Roles of Website Loyalty and Need for Cognition

Article excerpt

INTRODUCTION

Imagine that you are searching for some useful information on a website when you cannot help but notice several banner ads. The banner ads incorporate animation that winks and jumps, and they rotate, with each new ad successively replacing the one that went before on the banner. Exposure to this kind of animated banner ads is common for consumers experience multiple animated banner ads on websites. Past research has shown that consumers were irritated when they were forced to view intrusive pop-up ads (Edwards, Li & Lee 2002) and successfully avoided these by installing pop-up blockers, which led to the demise of pop-up ads. However, since banner ads appear on the same page as the website that consumers visit and since there is no available tool to block them, consumers are often forced to view one or more animated banner ads on a website.

Thus, the following question arises: If consumers hate banner ads, why do marketers use them and why do web sites agree to host them? Since consumers have come to ignore such ads and do not click on them because distractive banner ads take away from the user experience, click through rates have shrunk to .5% (Yaveroglu & Donthu 2008). However, recent research which studied 139 online ad campaigns by merging data from its panel of U.S. internet users with shopper data shows that banner advertising, despite a lack of clicks, had a significant positive impact on the advertiser (Klaassen 2009, Fulgoni 2008). Specifically, visits to the advertiser's website increased by at least 46% over a month, the probability of making a query using the advertised brand name increased by 38%, and the online purchases for the advertised brand increased by 27%.

Past research on forced exposure to rich media and animation in Internet advertising is divided on the issue of consumer evaluations of banner ads. Yoo and Kim (2005) show that animated banner ads produce negative cognitive and emotional effects on consumers. Contrastingly, another stream of research shows that consumers' repeated exposure to banner ads results in ad liking and consequent effectiveness because of mere exposure effect (Fang, Singh & Ahluwalia 2007). Similarly, another study shows that consumers' highest forced exposure to banner ads leads to favorable attitudes toward the ad, the advertised brand and intentions to purchase the brand (Cho, Lee & Tharp 2001).

Past research is not only divided on consumer evaluations of banner ads and brands featured in such ads, it is silent on the spill-over effects of consumer perceptions on websites that host such ads and intentions to return to the website. Since website managers must attend to the attitude effects of ads not only on advertised brands (which pay for a listing) but also on the website itself since the website, too, is a product with its own brand equity, it becomes imperative--both managerially and theoretically--to understand the effect of animated banner advertising on consumers' attitudes toward the host website as well as toward the featured brands. The purpose of this research is to explore the effects of banner ads on perceptions of host websites and on brands featured in such ads.

The paper is structured as follows. First, a study is conducted to determine consumers' reactions to animated banner ads on websites. Next, a subsequent study incorporates the results of the first study, along with existing theory, and presents and tests a model of the effects of animated banner ads. The results are then discussed and suggestions for future research on banner advertising are offered. Consistent with the view of methodological pluralism, this research combines content analysis following a qualitative study with quantitative research utilizing MANOVA, t-tests, and regression to provide a detailed and analysis of the issue.

FIRST STUDY

The objectives of the initial study were to explore consumers' overall feelings and reactions to animated banner ads on websites. …