Re: UKNM: Why Jakob Nielsen hates banner ads

[Clay Shirky]

> Last time I checked click through rates were something like 2% so I

> guess most feel this way.


Right, but typical response rates for direct mail campaigns are in the

1-2% range, and cost much more to produce and distribute. The thing

that keeps a lot of banner ads going is that they are as effective,

and less expensive, than other customer acquisition techniques like

direct mail. 


A stock brokerage is going to spend order a thousand pounds to acquire

a customer, a telco or mobile phone company around 500 pounds, etc,

and a CPM of 30 pounds with a 2% click through and a subsequent 2%

completion rate is only 75 pounds per customer. Go with a targetted

CPM of 50 pounds, and 1% click through and conversion rates, and

you're still at 500 pounds a customer - lousy if you're selling

washing-up liquid, but brilliant if you're selling cars.


-clay 

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