Pricing Banner Advertisements in a Social Network of Political Weblogs

By Hunter, Starling David | JITTA : Journal of Information Technology Theory and Application, June 2011 | Go to article overview

Pricing Banner Advertisements in a Social Network of Political Weblogs


Hunter, Starling David, JITTA : Journal of Information Technology Theory and Application


Abstract:

This paper employs social network analysis to explain variation in the pricing of 846 banner advertisements appearing in a community formed by eighty-nine "liberal" and eighty-four "conservative" Weblogs. As predicted, Weblogs that bridge "structural holes" between otherwise disconnected segments of the community command significantly higher prices for their advertisements. Also as predicted, the price of banner ads increases with the number of impressions received, with the size of the ad, when the ad is located higher on the page, and when fewer other ads appear.

Keywords: online advertising, social network analysis, social capital, social networking, Weblogs, social media

INTRODUCTION

Much of the empirical research on the effectiveness of Web banner advertising may be divided into two broad categories-a concern with communication outcomes and a concern with cost effectiveness. In the former group belong studies of the effects of exposure to Web banners on an audience's cognitive, affective, and behavioral responses. Dependent variables in these studies include brand recall and recognition (Briggs and Hollis 1997; Li and Bukovac 1999; Dreze and Hussherr 2003), attitude toward the brand (Dahlen, Rasch, and Rosengren 2003), clickthrough rate (Gatarski 2001; Robinson, Wysocka, and Hand 2007), and purchase intention (Dahlen, Ekborn, and Morner 2000; Gong and Maddox 2003). Independent variables typically include characteristics of the banner ad itself, e.g., the type of appeal (Xie, Donthu, and Lohtia 2004); the information content of the ad copy (Calisir and Karaali 2008), particularly its relevance and degree of personalization (Tam and Ho 2006); the use of animation, sound, or motion (Yoo and Kim 2005; Chen et al. 2009); as well as the banner's size (Sigel, Braun, and Sena 2008; Burns and Lutz 2008), design (Lohtia, Donthu, and Hershberger 2003), location (Ryu et al. 2007), visual complexity (Huhmann 2003), and color scheme (Moore, Stammerjohan, and Coulter 2005).

Empirical studies on the cost effectiveness of Web banner advertising can be further divided into two groups- algorithmic and strategic. Noting that advertisers compete for the premium space on a publisher's Web page, researchers in the former group have treated revenue maximization as an online variant of the well-studied binpacking problem (Dyckhoff 1990). Accordingly, they developed and tested a variety of scheduling algorithms to optimize advertisement inventory (Nakamura 2002), display frequency (Amiri and Menon 2003; Kumar, Jacob, and Sriskandarajah 2006), and budget allocation (Fruchter and Dou 2005).

The "strategic" studies employ a broader frame of reference for the revenue maximization question. Namely, they consider competitive and cooperative relationships that exist among different participants in the online advertising industry (e.g., Sherman and Deighton 2001). And while their designs and results may differ, they do all agree on one point: the motivations and behaviors of several parties can influence the ad pricing decisions. For example, in their examination of the pricing of banner advertisements Li and Jhang-Li (2009) examine the roles of four key players in the online advertising industry-advertisers, visitors, publishers, and channel providers under two market conditions-duopoly, i.e., the presence of two heterogeneous channel providers (e.g., Google for search advertising and Double-Click for display) and monopoly, where the two channels "are merged into a single dominant player with monopolistic power in the market." Kumar, Dawande, and Mookerjee (2007) include advertisers, publishers, and visitors in their model, while Fruchter and Dou (2005) include the role of advertisers, visitors, and two types of publisher-specialized and generic portals.

Unfortunately, the supply of scholarly research on how to "crack the code of social network advertising" falls far below demand from industry professionals (Williamson 2008).

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Pricing Banner Advertisements in a Social Network of Political Weblogs
Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.