Worldata

The History of Internet Advertising

Article as seen in DM News April 21, 1997

In just a relatively short time, advertising on the World Wide Web has become a common activity embraced by advertisers and marketers across all industry sectors. Looking back a little more than two years, that was not the case.

As a VP at Worldata for over 10 years, I have been privileged to witness the development and growth of a pioneering media placement service for the Internet. Taking a look at the early direction and misdirection that has gotten Web advertising where it is now gives us a better understanding of where it is heading.

Working with prominent high-tech clients during Comdex '94, Roy and Jay Schwedelson identified the buzz in the air about the "new Internet" and the Information Superhighway. As regular exhibitors at and attendees to Comdex, they received certain technical insight that was not as available to their colleagues in the direct marketing community.

At Comdex '94, Jay Schwedelson was helping man the booth during his break from the University of Florida. A marketing/communications major, Jay grew up around direct marketing and looks forward to an exciting future within the DM community. Both Roy and Jay had attended the keynote speech by Phillipe Kahn, which touched on futures within the high-tech industry.

After listening to the speech, Jay's concern was in regards to the future of direct marketing in the next 10, 20, or even 30 years, and would it be there for him.

On the flight home, Roy and Jay continuously brainstormed different ways that advertising could and should work on the Internet. They synthesized traditional direct response marketing with the Internet, conceptualizing the dynamics of targeted media placement on the Web. It was at this point in time, WebConnect was born.

Roy Schwedelson and Jay Schwedelson realized that the Web was the next direct response medium and that the brokerage of information served on this new technology was a logical outgrowth of their traditional business. While the Schwedelson's were working towards the future, others entrepreneurs and industry pioneers were doing the same. It was evident that Web-based advertising was the next mountain to be climbed. Below is a short time-line representing some of the key events which occurred relating to the Internet.

Milestones on the Information Superhighway relating to Advertising (Source: Ad Age, corporate press releases, and the Internet)


Chronological History Of Internet Advertising

1989

  • Tim Berners-Lee invents the World Wide Web while working at CERN, the European Particle Physics Laboratory.

    April 1994

  • Andreesen and Clark start NetScape.

    October 1994

  • HotWired site launches with ads from AT&T, Sprint, MCI, Volvo, and others.
  • Time-Warner launches Pathfinder with test ads from AT&T.
  • Roy Schwedelson delivers a speech on the Information Superhighway at the Fall DMA conference in Toronto urging direct marketers to get involved.

    November 1994

  • CMP's TechWeb is launched with ads from AT&T, MCI, and Tandem Computers.
  • WebConnect is designed based on a direct response marketing model. Roy Schwedelson and Jay Schwedelson return from COMDEX with initial concepts on a banner ad placement service.
  • WebConnect advertising media kit is placed on the web detailing the program.

    January 1995

  • Prodigy is the first commercial online service to offer Internet access to its subscribers.
  • Vibe Online cuts deals with MCI, Saturn, Timex, Jim Beam and Air Walk for dollar amounts ranging from $20,000 to $60,000.

    February 1995

  • Grey Interactive is awarded the Procter & Gamble account for handling web-based media.
  • ESPN aggressively pitches advertisers on $1 million charter sponsorships of its future Web site and additional online properties.
  • CBS Web site is launched.

    March 1995

  • Yahoo!, a popular Web directory, transforms into a commercial business.
  • Modem Media is awarded the AT&T account for interactive media.
  • WebConnect signs up the "First 100" member sites to its advertising network: Home Education Resource Center, Art Cellar Exchange, 'Vettes on the Net, Dale Carnegie Systems, Home Business Review, and others.
  • Ragu is identified as one of the first packaged-good marketers to establish a presence on the Web.

    April 1995

  • AT&T and Saturn take banner ads on Pathfinder at the cost of $30,000 per quarter.
  • Internet Advertising Council meets to identify goals, objectives and membership guidelines for the newly-formed

    June 1995

  • WebConnect introduced to catalogers at the summer Catalog Conference in Chicago. Over 60 business, consumer, and high-tech market categories from a base of over 500 member sites are offered.

    July 1995

  • NetScape and InfoSeek alter their pricing model to accommodate cost-per-thousand impressions.

    August 1995

  • MSN online service is launched by Microsoft.
  • Proctor & Gamble and Kraft register a combined 184 domain names to secure their brand names in cyberspace.
  • WebConnect places banner ads for Encyclopedia Britannica.

    September 1995

  • ESPNET SportsZone acquires eight advertisers to contracts totaling more than $1 million. October 1995
  • In excess of 24 million adults in the U.S. and Canada have access to the internet.
  • Poppe Tyson spins off its web ad sales unit as DoubleClick. Whereas WebConnect took the path of traditional direct response marketing for Web ad sales, DoubleClick adopts the Cookie technology which tracks a user's activities on the Web.
  • Roy Schwedelson, CEO of Worldata and founder of WebConnect, takes a strong position against the usage of Cookie technology based on protecting a user's privacy.

    January 1996

  • Microsoft allocates and pays $200,000 for sponsorship of the Superbowl Web site.
  • The New York Times makes its entry into cyberspace with ads from Toyota and Chemical Bank.
  • NetGravity introduced the AdServer ad management system for Web sites.

    February 1996

  • Focalink Communications introduces the SmartBanner media planning service.
  • PointCast launches an innovative client-server application which delivers tailored content from the Web in the form of an animated screen saver.

    April 1996

  • Juno launches a free, ad-supported e-mail service. This is shortly followed by a similar service from Freemark Communications.
  • The Wall Street Journal makes its entry into cyberspace.

    May 1996

  • iVillage nets six-digit in advertising dollar commitments based on a corporate philosophy of humanizing cyberspace with targeted online communities.
  • Marketwatch, a Web media planning tool, is introduced by FocaLink Communications.

    June 1996

  • WebConnect creates and offers accurate measurement tools to advertisers. Private URL's created to track Impression and Click-Through rates. New ad management technologies support animated GIF's, banner rotation, and CGI/Pearl scripting.

    July 1996

  • An ad campaign featuring animated banners is launched by AT&T
  • As reported by Intelliquest, 35 million U.S. residents accessed the Internet or online services during a three month period.
  • WebConnect's family of participating member sites tops 1,000.

    August 1996

  • Microsoft says its aggressive plans will position them as the largest Web advertiser.
  • Privacy advocates heighten industry awareness on the invasiveness of the Cookie technology.
  • The delivery of free content to users of Microsoft's Web browser is agreed upon by major sites.
  • Poppe Tyson files for an IPO

    September 1996

  • GM expands its content to over 38,000 pages, making it one of the largest sites to market products.

    October 1996

  • CASIE issues proposed Web ad banner guidelines.
  • Prodigy Inc. takes the wraps off a long-anticipated Web-based version of its online service.

    November 1996

  • ONSALE, the Internet auction house for refurbished personal computers, announces recorded monthly sales of $4 million. February 1998
  • HotMail Corp. announces that registrations for its service has passed the 2 million mark.
  • A proposal submitted by Bell Labs's Information Science Research Center (RFC:2109) calling for new Cookie standards is under review by the Internet Engineering Task Force, a major step towards protecting a user's privacy.

    March 1998

  • Yahoo! makes a minimum advertising commitment to Netscape of $25 million over two years.

    April 1998

  • Time Inc. New Media agrees to syndicate some Pathfinder content on the Web site for the AT&T WorldNet Service.
  • Microsoft Corp. announces it plans to purchase WebTV Networks Inc. for $425 million.

    With all of the milestones that occurred, in such a short time span, we are still at the start of our climb. I'm sure many more pioneers and entrepreneurs will join in the adventure .

     

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