The Emerging Position of the Internet as an Advertising Medium

  • Authors:

  • Alvin J. Silk;Lisa R. Klein;Ernst R. Berndt

  • Affiliations:

  • Graduate School of Business Administration, Harvard University, Boston, MA 02163, USA asilk@hbs.edu;Jones Graduate School of Management, Rice University, Houston, TX 77005-1892, USA lklein@rice.edu;Sloan School of Management, Massachusetts Institute of Technology, Cambridge, MA 02139, USA erberndt@mit.edu

  • Venue:
  • Netnomics
  • Year:
  • 2001

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Abstract

This paper examines the emerging position of the Internet as an advertising medium. The nature and time path of its evolution is subject to considerable uncertainty arising from issues relating to expansion of the Internet's penetration of households; consumer demand for information; development of pricing policies and measurement capabilities; and its attractiveness to advertisers in different product/service categories. Our analyses of these issues suggest that its long-term impact on intermedia rivalry will be broad and substantial. The Internet is emerging as an adaptive, hybrid medium with respect to the factors hypothesized to affect intermedia substitutability, namely, audience addressability, audience control, and contractual flexibility. Possessing such capabilities, it looms as a potential substitute or complement for all of the major categories of existing media and appears capable of serving a wide range of communications objectives for a broad array of advertisers.