The online advertising industry has been buzzing over the recent introduction of a couple of new media planning tools and whether or not they had the potential to shake up the industry. Now that advertisers and media planners have had the opportunity to examine the tools, the reviews are beginning to roll in. Here are two interesting articles examining ad industry reaction: David Smith’s take in Mediapost’s Metrics Insider and Mike Shields’ article in MediaWeek.

In my last post, I wrote about how high gas prices affected traffic to GasBuddy.com and searches for “Gas Prices.” It turns out that skyrocketing gas prices also have a big impact on the number of searches phrases containing “Hybrid,” such as “Hybrid Cars,” “Hybrid Vehicles” or “Hybrid SUVs.” There were 2.74 million searches including “Hybrid” in May 2008 according to comScore Marketer, an 80% increase over May 2007.

Rising gas prices may drive interest in fuel efficient cars in the U.S. more than the concern global warming ever has. The correlation between searches for “Hybrid” and average retail gas prices has a coefficient of .93 and is shown graphically in the chart below.

Interestingly, those searching for phrases with “Hybrid cars” and “Hybrid SUVs” or “Hybrid Trucks” show differences in demographics. Those making more than $100k per year were by far the most likely to search for “Hybrid Cars,” while those in the $25-50k income bracket were the most likely to search for “Hybrid Trucks” or “Hybrid SUVs.”

Back in November of last year, I wrote a blog post suggesting that the use of the “same store sales” metric as a barometer of retail health could lead to erroneous conclusions regarding the performance of individual retailers or the retail economy in general. My rationale was that many retailers don’t include online sales in such a measure and e-commerce has grown to the point where it represents a material contribution to the growth of many retailers’ businesses.

So, I was particularly pleased when I recently read in the Wall Street Journal and International Herald Tribune that my “recommendations” were being taken to heart by Moody’s, who will now be including online sales as an important factor in their credit ratings. I think this is precisely the correct thing to do. E-commerce has come of age.

Hello, my name is Steve Dennen, and I am a vice president of product management at comScore. I recently was interviewed by Steve Smith in his Behavioral Insider column at MediaPost, and thought I'd share the link with you here on the comScore blog. We discussed cross-media measurement, online/offline media planning and comScore Segment Metrix - click here to check it out.

Last week, I gave a keynote address at the 4th Annual ShopLocal Summit. ShopLocal.com is a multi-channel marketplace that houses online and offline retailer promo information. With an increasing number of retailers turning to ShopLocal.com, it has become increasingly important for retailers to not only understand the online marketplace but also how online marketing can help increase offline sales.

During my presentation, I shared some results from recent comScore studies that gauged the impact of online advertising on in-store sales. Using the comScore panel, offline sales impact can be measured by linking panelists’ exposure to online ads with their in-store buying (through the use of retailers’ loyalty card data). Lift is computed by comparing the offline buying of consumers who had been exposed to an online ad campaign with the buying of those who had not been exposed to the campaign.

We’ve seen some very interesting findings that I’d like to take a moment to discuss:

#1. Search advertising provides higher sales lift than display advertising, but when combined, the synergy provides the highest lift…

When comparing the offline sales impact among consumers exposed to ‘search advertising only’ with the impact among consumers exposed to ‘display advertising only’, search holds a clear advantage, with an 82-point lift in offline sales compared to a lower 18 percent increase among consumers exposed only to display advertising. This is because the people who get exposed to a search ad are much more likely to be “in the market” for the brand/category being advertised and as a result, a search ad will drive more offline buying than a display ad. But, what’s especially important to notice here is that exposure to both search and display ads provides the highest lift (119-points over the control), which is even greater than the sum of the two tactics alone.

#2. While search advertising results in a higher sales lift than display advertising among the people exposed to the ads, the number of people reached by display advertising is typically markedly higher than the number of people reached by search advertising …

When we look specifically at the total number of consumers exposed to ‘search advertising only’ versus ‘display advertising only’, we see that display ads typically provide the greatest reach by a long shot. Search advertising – which generates an impressive sales lift – typically reaches a much smaller percentage of consumers.

Key Takeaway: So what do these findings tell us?

Based on the research we’ve conducted at comScore, it’s clear that the use of online advertising is a terrific way to grow retail sales. But, what’s also apparent is that media planners need to consider both sales lift and reach when designing online search and display ad campaigns that are intended to drive offline sales. While search advertising generates a much greater sales lift among the consumers it reaches, the far broader reach of display advertising can more than compensate for display ads’ lower sales impact. Smart media planners will carefully mix their use of both types of online advertising so as to optimize the return from their investment in online marketing.

I’m interested in hearing your thoughts on the above and getting a discussion going online…Please let me know what you think about these findings via the comments link below.