The impact of online advertising on consumer buying behaviour towards mobile phones

“The impact of Internet Advertising on Consumer Buying behavior
towards Mobile phones”
Bachelor of Management Studies (BMS)
Semester V
Submitted
In Partial Fulfillment of the requirements
For the Award of Degree of
Bachelor of Management Studies
By
(Rahul Milind Yadav)
(Seat number: _______________)

Table of contents
Sr no. Topic Page
no.
1. Abstract 5
2. Chapter 1 6
1.1 introduction
1.2 the concept of Online advertising
1.3 the origin of online advertisement
1.4 TYPES OF ONLINE ADVERTISEMENT
1.5 UNDERSTANDING THE CONCEPT OF CONSUMER BUYING
BEHAVIOUR
1.6 STUDY OF GROWTH OF MOBILE PHONE USERS
1.7 INDIA’S SHARE IN GLOBAL MOBILE PHONE MARKET
3. CHAPTER 2
OBJECTIVE AND SCOPE OF RESEARCH
17
4. CHAPTER 3
LITERATURE REVIEW
20
3.1 INTRODUCTION
3.2 THEORETICAL FOUNDATION OF THE STUDY
3.3 INTERNET ADVERTISING
3.4 INTEGRATED MARKETING COMMUNICATION
5. CHAPTER 4
RESEARCH METHODOLOGY
25
4.1 RESEARCH DESIGN
4.2 DATA COLLECTION
4.3 VALIDITY AND RELIABILITY
4.4 DATA ANALYSIS
6. CHAPTER 5
DATA ANALYSIS AND INTERPRETATION
28
7. CHAPTER 6
SWOT ANALYSIS
41
8. CHAPTER 7
CHALLENGES FACED BY ONLINE ADVERTISING INDUSTRY IN INDIA.
44
9. CHAPTER 8 SUMMARY, CONCLUSION AND RECOMMENDATION 47
10. ANNEXURE(QUESTIONNAIRE) 50
11. BIBLIOGRAPHY 51

Abstract
Advertisers are expected to shift and spend millions in internet advertising in the
coming years than TV, print ads and another traditional advertising media. With the
rapid growth in technology, the internet is becoming an important one stop point for
consumers in finding most of their needs. Be it communication, entertainment,
shopping, information search, internet serves as a panacea for all their requirements.
Many consumers are online every day for their personal work, but do they notice the
ads, banners displayed on that webpage, and most important their recall value. The
current study investigated the impact of internet advertising on consumer buying
behaviour by conducting a survey.
The study sought to determine the effectiveness of internet advertising on reach and creation of
awareness; to establish the reliability of internet advertising through recall; and to
determine the relationship between internet advertising and purchase decision. The
study used a case study research design. The study used stratified sampling technique to select
100 study respondents. The primary data was collected using questionnaires. Content analysis
was used to analyse qualitative data. The data was presented through
percentages, means, standard deviations and frequencies. The study found that
internet advertising was effective on reach and creation of awareness due too diverse
usage, and established that its reliability as an advertising media was low compared to
TV. Internet advertising has significant relationship with purchase decision of the
consumers and therefore is a key determinant in influencing consumer behaviour.

Chapter One
Introduction
Advertising function is the pivot around which all other functions rotate. Goods and services
are not produced for their owner’s sake, but for the satisfaction of the consumer need. As it is always
said that business does not exist in a vacuums it must interact with certain factors, so is advertising.
Internet has grown tremendously in both its applications and number of users due to its
unique characteristics of flexibility, interactivity, and personalization. It has been a very useful tool
for communication, entertainment, education, and electronic trade. The revolutionary change
brought forth by information technology has an important impact on the daily lives. It has transformed
the way we do business by allowing retailers to offer unlimited range of products and services to all
consumers from around the world at any point in time. The Internet has emerged as an advertising
medium (Silk et al., 2001). Many companies have turned to the Internet to advertise their products
and services; and the Internet is deemed to be the most significant direct marketing channel for the
global marketplace. Companies are pouring billions of dollars into Internet advertising to obtain
greater return on investment on ads. The Internet has given consumers more control in accessing
information on products and services. There are several factors that contribute to consumers pull
for online content—consumers are the one who decide when, where, what, and how much
commercial content they wish to view. The Internet enables consumers to access an unlimited range
of products and services from companies around the world, and it has reduced the time and effort
they spend on shopping.
It has become a major source of information consumption, and to some extent, has replaced
old media such as the radio, television and the newspaper. The main advantages of the Internet
include its mass availability and its almost instant access to current information. As a result of the
public's reaction to these advantages, Madison Avenue realized the potential of the new media and
soon incorporated it to its budget. Convinced by the initial web publications of the early '90s,
companies soon instilled momentum in the new channel. Today, more than 700 million people use the

Internet daily, mostly so in developed countries (USA, China, Japan, Germany and Britain, e.g). The
most popular uses of the Internet are searching through data and information, and the purchasing
of products and services. In light of these, it is understandable why many companies advertise their
products and services online. In addition, advertisers can quickly benefit from changing advertising
scripts, from the possibility of better segmenting their market, and from relatively low costs.
Consumers play a much more active role in searching for information online with some goal
in mind, and that goal can influence individual behaviours and responses to online information and
advertisements (Smith, 2002). With the rapid advancement in the computer industry, many
companies have made the Internet as part of their advertising media mix to take advantage of the
online technologies. The Internet has become a popular advertising platform because marketers
found that the Internet possess greater flexibility and control over the advertising materials. Since
the Internet can be used as an efficient marketing 2 communication tool, both scholars and
practitioners are interested in understanding how to take full advantage and maximizing the value
of this communication medium
Encyclopaedia Britannica (1999) gives the following definition of advertising as: “Advertising is the
techniques and practices used to bring products, services, opinions or causes of notice for the
purpose of persuading the public respond in a certain way toward what is advertised”. Advertising
is an essential part of our life and the important source of income for the media. Many people say
they don’t like TV commercials in the middle of the favourite movie, advertising on a radio, billboards
and so on. According to Benson-Eluwa, (2005) “Advertising is a form of non-personal method of
communicating information which is usually paid for by sponsor through various media”. These
definitions can tell one that advertising is a persuasive communication, because it tries to persuade
the reader, viewers or listeners to take to the sponsors’ point of view and also to take some
appropriate actions towards something.
The essence of being in business by any business outfits is to produce the sales and make
profits. In order to remain in business, an organization must generate enough sales from its products
to cover operating costs and post reasonable profits. For many organizations, sales estimate is the

starting point in budgeting or profit planning. It is so because it must be determined.
In most cases, before production units could be arrived at, it will turn to material
purchases.
The economists believe that advertising is persuasive because they agree that advertising is
not interested much in fulfilling that desire of consumers, people taste are changed so that they will
buy what has been manufactured.
The criticism in reality is a negation of the concept of consumer sovereignty, which claims
that the free market generates the flow of production along the lines that satisfies consumer taste.
Here, taste determines what shall be produced; producer sovereignty governs the consumer versus
producer sovereignty in the market place.
For us to fully know the meaning of advertising we should also know the various ways
advertising can be performed and some of these ways are:
- Through media, which can be broadcast media (television and radio) or print media
(newspaper, magazine or pamphlets) these are means or channels where information on the
product can be disseminated to a scattered audience usually at the same time and
successfully. It requires a lot of research before it can be done properly.
- It can also be done through displays of the product on a moving vehicle, shops or buildings.
It is usually done in a catching way in order to catch the attention of the people.
- Another is through billboards which are a large signpost or boards placed on busy roadsides,
creating the awareness of the existing product to all the people passing by.
- Traditionally, these are ways to advertise a product with the use of hawking,
town crying and calls to the village members with any significant symbol
depending on the culture of that place.

1.2The Concept of Online Advertisement:
Internet advertising is a form of promotion that uses the Internet and World Wide Web for
the expressed purpose of delivering marketing messages to attract customers. Examples of
online advertising includes contextual ads on search engine results pages, banner ads, Rich
Media Ads, Social network advertising, online classified advertising, advertising networks and e-
mail marketing, including e-mail spam.
Online video directories for brands are a good example of interactive advertising. These
directories complement television advertising and allow the viewer to view the commercials
of a number of brands.
If the advertiser has opted for a response feature, the viewer may then choose to visit the
brand’s website, or interact with the advertiser through other touch points such as email,
chat or phone. Response to brand communication is instantaneous, and conversion to
business is very high.
This is because in contrast to conventional forms of interruptive advertising, the viewer has
actually chosen to see the commercial. 4 Consumer can gather information about products
and services, communicate with other consumers and firms for related products and
services, and sometimes complete transactions. As the Internet session is a self-selected
environment of the consumer, the promotion message will be more effective. Internet
advertising is also capable of providing an experiential environment to the consumer
through virtual reality interfaces thus allowing the consumer to experience some of the
features of products before making the purchase decision. Consumer can provide feedback
content about the product, to the firm and to other consumers. A positive feedback
becomes a good promotion for the marketer. A marketer can even exploit a negative
feedback by solving the consumer’s problem and showing the commitment of the
organization to satisfying consumer needs. Consumer can also add “collective content” to
the medium through discussion forums like the virtual communities. In
India, online advertising has gained increased popularity with more people spending time online.

1.3 The Originof Online advertisement
In its 17-year existence, Online Advertising has become the fastest, and one of the most effective
advertising mediums in history. Today, it is one of the essentials of a successful business, a media
platform that allows interaction with customers in the most creative and interesting ways, (although
there continues to be a large majority of irritated web users).
For the sake of knowledge and a more sympathetic understanding of online ads, let us begin by
tracing the history of online advertising.
The Origin of Spam
In 1970’s, a British comedy named ‘Monty Python’ first used the word ‘spam’ in an early sketch of
a
couple at a restaurant trying to order food without ‘spam’ on it. This particular comedy had
tremendous impact on forum users who started to use the word in their Usenet posts. Soon, online
marketers started to overpots and flood forum users with junk mail that repeatedly recounted
‘spam’ in the Monty Python sketch.
By 1980, online marketers had changed from flooding Usenet forums to sending out emails,
practice that continues up until today. The numbers of spam emails that are sent everyday
is a whopping 90 million, which is not difficult to believe since 85% of our inboxes are
screaming spam
every hour.
As a marketing technique however, spam emails have little effectiveness since most of us barely
read any.
When Banners came to be…
The year 1994 saw the first online advertisement that was quickly followed by a period of
experimentation on advertiser and publisher ad formats and technology. This initial phase e
need with the launch of one of the first ad technologies, the DoubleClick in 1995. The earliest
advertisers were aware of the differences between traditional and online advertising and
undertook
a target-market research. However, it wasn’t until many years in following that the Internet was
used as a full-blown medium for effective advertising.
In the late 1990s, billions were invested in online advertising. Advertisers designed the standard
468×460-pixel banner ads that were traditionally highly demanded. With gradual increase in
market

competition, there were thousands pouring in money behind developing banner ads. At the time,
Yahoo! could charge anywhere between $30-$100 to run banner ads. Up until the dot com bubble
burst and 4 years following, Internet spending on banner ads reached $8.2 billion.
Banner ads today, as they were more than a decade ago, are not effective online advertising
mediums. With considerable designing required, they are time consuming and expensive to
create.
Besides, the low return on revenue spent on developing banner ads renders them useless to most
online advertisers. Not surprisingly therefore, by mid-2000, banner ads started to dry up, and has
become obsolete at the time of writing.
The efficiency of search engine technology has sustained online advertising. Because of its high
dependability and rate of interest, the search engine market has shown a steady growth over the
years, pulling online advertising many notches.
Google started as a search engine but clearly, is a hundred times more than that today. Google’s
algorithm shows the most appropriate results and for a long time, Google worked on its
functionality. Without selling anything, it continued to drive traffic until 2000, when it first
introduced Google AdWords.
Drawing away from banner advertising, still a popular form at the turn of the millennia, Google
revolutionized online advertising by using relevant text ads to sell. Google’s success rested on
introducing the click-through rate that would measure the relevancy of the advertisement, also
ensuring host payment only when users clicked on the ads.
Pay-Per-Click advertising was not a Google original. Google perfected PPC and changed the
approach
advertisers took to online advertising. Google AdWords encouraged advertisers to come up with
comprehensive, relevant ads instead of mere selling.
Pay-per-click and Pay-per-impression are two different online advertising models. Pay-per-click,
as the
name suggests, involves payment to host every time users click on an ad. Pay-per-impression
calculates the cost of the entire marketing campaign that is conducted online.
PPC is instrumental in bringing targeted traffic to a website while PPI is the best brand building
model. Both however, are susceptible to click fraud. Where Google’s success lies is in devising

automated systems that keep corrupt practices in check.
Social Media Advertising
Social media is everywhere and has been in vogue since the past five years. At its core, social
media
is a communications and networking tool, whose popularity has been constantly rising since its
users
can connect, share and interact among themselves. Instead of being a mere informative reading
interface, social media allows users to comment, rate and share news, views and information.
Social media can be divided into:
Social News – Digg Propeller, Reddit
Social Networking Tools – Twitter, Facebook, Hi-5
Social Photo & Video Sharing – YouTube, Flickr, Photobucket
Social Bookmarking – Simply, Del.icio.us
Targeting the right market is important for any business and this is one of the biggest advantages
of
social media advertising. By collecting a user’s demographic information, social media tells you
where a business’ target market is most wide and active. Advertisers can then use this information
to tap their intended market.
Social media advertising is viral, free and far-reaching. Although actual conversions cannot be
tracked from ‘friends’, ‘likes’, or ‘follows’, social media remains the best online advertising
mediums.
The Current Face of Online Advertising
Online advertising has recovered and has been steadily rising since 2004. With the number of
hours
an Internet user spends browsing websites, advertisers have realized the importance and
advantage
of exploiting user tendency to scour the web. From SEO marketing, blogs and social media to
sophisticated ads, interactive tools and branding technologies, advertisers are now using a wide
array of platforms to increase business visibility.

Viral marketing is now a popular mode of advertising using video ads to market products. Sites like
YouTube, Meta-cafe, etc., are popular product advertising platforms. But online advertising has
barely
been perfected. Annoying pop-up ads still exist while free sites like YouTube now include
commercials or pre-roll ads that cannot be bypassed to the actual video.
1.4 Types of Online advertisement:
Floating ads: A floating ad is a type of rich media Web advertisement that appears uninitiated
superimposed over a user-requested page, and disappears or becomes unobtrusive after a
specific time period (typically 5-30 seconds). The most basic floating ads simply appear
over the Web page, either full screen or in a smaller means of escape, such as a close button.
More sophisticated versions can come in any shape or size and include sound, animation, and
interactive components
Expanding ads: These are ads that expand when users click on them. The ads do not expand
just from mousing over hyperlinks, which is a technique used by some other advertisers. They
often take a long time to download, which in turn can negatively impact the
visitor's experience on that page. Polite ad formats were developed to address this challenge by
enabling advertisers to serve larger file formats without disturbing the load time for the rest of the
images on the page. A polite ad format is loaded in two phases:
Phase One: The initial load is a compact image or SWF file that is smaller in size, so there is no
delay in loading
other contents on the page. This could be the first few frames of the ad, or a teaser. file that is
smaller in size, so there is no delay in loading other contents on the page. This could be the first
few
frames of the ad, or a teaser.
Phase Two: The main load is the full version of the ad. The full ad can have a larger file size. It is
loaded only
after the whole web page has finished loading into the visitor's browser
Wallpaper ads: An ad which changes the background of the page being viewed
Trick Banner: A banner ad that attempts to trick people into clicking, often by imitating an
operating system
message.
Pop-up: A new window which opens in front of the current one, displaying an advertisement, or
entire
webpage.
Pop-under: Similar to a Pop-Up except that the window is loaded or sent behind the current
window so that the
user does not see it until they close one or more active windows.

1.5 Understanding the concept of Consumer Buying behaviour:
Consumer behaviour has been always of great interest to marketers. The knowledge of
consumer behaviour helps the marketer to understand how consumers think, feel and select
from alternatives like products, brands and the like and how the consumers are influenced
by their environment, the reference groups, family, and salespersons and so on. A
consumer’s buying behaviour is influenced by cultural, social, personal and psychological factors.
Most of these factors are uncontrollable and beyond the hands of marketers but they have
to be considered while trying to understand the complex behaviour of the consumers.
Consumer is the study “of the processes involved when individuals or groups select,
purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and
desires” (Solomon 1995, 7).
In the marketing context, the term „consumer ‟ refers not only to the act of purchase itself,
but also to patterns of aggregate buying which include pre-purchase and post-purchase
activities. Pre-purchase activity might consist of the growing awareness of a need or want,
and a search for and evaluation of information about the products and brands that might
satisfy it. Post-purchase activities include the evaluation of the purchased item in use and
the reduction of any anxiety which accompanies the purchase of expensive and
infrequently-bought items.
Each of these has implications for purchase and repurchase and they are amenable in
differing degrees to marketer influence (Foxall 1987). Engel, et al. (1986, 5) define consumer
behaviour as “those acts of individuals directly involved in obtaining, using, and disposing of
economic goods and services, including the decision processes that precede and determine
these acts”.
Simple observation provides limited insight into the complex nature of consumer choice
and researchers have increasingly sought the more sophisticated concepts and methods of
investigation provided by behavioural sciences in order to understand, predict, and possibly
control consumer behaviour more effectively.

1.6 The Study growth of smartphones users:
To date, it’s estimated that there are roughly 2 billion smartphone users in the market
(1.91 billion to be exact), with that number expected to increase another 12% in 2016
to top 2.16 billion people globally. That means that for the first time (possibly in
history) more than one-quarter of the world's population will all carry a similar device.
The growth of smartphone devices can be attributed to a number of factors.
Technological innovation, improved usability, increased accessibility, but for many
the growth has been heavily attributed to a decrease in price.
The era of inexpensive or ‘Budget-Friendly’ smartphones has greatly opened the
doors for mobile adoption in emerging markets. When smartphones first entered the
market, their price (closer to the $1000 mark) made it difficult for consumers to justify
the purchasing decision. But now the dramatic price drop of the smartphone is felt
largely to be the reason for its growth over the past two years in less developed
countries.
Heavy growth has been noticed in the Asia-Pacific ring, where global powerhouses
like China (500 million smartphones), Japan (57 million) and Indonesia (52 million)
set the standard for smartphone adoption. India, of course also plays a significant
role, with a population volume that demands respect.
India has a huge smartphone market of 167 million, with the number predicted to
grow past 200 million by 2016. What is interesting to note though is India's
smartphone penetration level, coming in last of our current list at 13%.

1.7 India’s Share in Global Smartphone Market:
Share of India in global smartphone market is expected to reach 13.5 per cent with 180
million units by 2019 from 7.6 per cent at present, according to a study by Assocham-
KPMG. “Thanks to digital revolution riding on the aggressively priced mobile data packages, India
is expected to have a total number of 180 million smart phones by 2019 claiming 13.5 per cent of
total global smart phone markets from 7.6 per cent at present,” industry chamber Assocham said
in a statement.
The study attributes growth to the advent of affordable smartphones in the price range of Rs
3,000–10,000 from local manufacturers and increase in low-cost data connectivity options as
reason behind shift of people towards smartphone. “Out of a total handset sale of 30 crore units
in financial year 2015, smartphones contributed 11.40 crore units, i.e., 38 per cent. This
contribution is projected to grow to above 50 per cent by 2020,” the statement said. With urban
penetration levels reaching saturation, the industry is looking at rural India for continued growth,
it added. “The growth of Indian handset manufacturing companies has been nothing less than
miraculous over the last five years.
India manufactured 11 crore mobile phones worth Rs 54,000 crore in financial year 2016, showing
a year-on-year growth of 83 per cent and 186 per cent, in volume and value terms, respectively,”
the statement said.
The study projects share of domestic smartphone makers is slated to grow further. “Out of 235
million handsets shipped in 2015, 40 per cent were smartphones and are projected to constitute
60 per cent of total mobile handset sales by 2020. The smartphone shipments in India grew a
healthy 23 per cent annually in first quarter of 2016 compared to the global growth, which stalled
for the first time ever since smartphones first began to sell,” the statement said.
It said that increase in Smartphone sales has changed the face of e- commerce industry in India in
the last two years. “Mobile transactions accounted for 41 per cent of total e-commerce sales in
2014. Developing a mobile (sometimes mobile only) strategy has been an important agenda for
many of the leading e-commerce players in the country over the last two to three years,” the
statement said.

Chapter two
Objective and Scope of the Research:
1. Research Objective:
1. To understand the coreconceptof Online Advertising.
2. To Study the effect on Consumer Behaviour.
2. To find out what influenced customer’s buying decision.
Scope of Research:
1. To understand role of online advertising.
2. Change in advertising trend after internet revolution.
3. Internet buying behaviour analysis and change in characteristics.

Value of study
The study may benefit marketers, businesses, government and academicians. This
study may be able to inform marketers on the consumer preference of the
advertising media and whether using Internet adverting would be effective in
reaching and increasing awareness of the target audience.
Before adapting marketing practices to the Internet, it is imperative to understand the
characteristics of the online customers towards online advertising as would be
revealed by this study. The Internet has grown in popularity as an advertising
medium because, among other things, it allows 24-hour interactivity between the
advertiser and customer. It is important for local businesses to look into internet
advertising as more consumers turn to the internet for their purchasing.
A small business that can offer online purchasing may be able to tap into this
customer base. The government from this study would understand the value of
Internet advertising
and its influence on consumer decisions which ultimately impacts electronic
commerce/trade, and therefore would effectively regulate how internet advertising is
delivered by acting rationally on laws that would restrict data usage, creating an
ambient environment and availing resources to internet providing companies and at
the same time safeguarding the interest of consumers.
For scholars and academic researchers, the current study forms a basis upon which
future research on Internet Advertising may be established. The findings may be
resourceful in providing viable information to academicians, researchers and
consumers on various concepts related to internet advertising.

CHAPTER THREE
LITERATURE REVIEW
3.1 Introduction
This chapter provides, through selective reference to some of the literature, a clearer
understanding of Internet advertising concept and outlines previous research
findings on the effectiveness of internet advertising based on measures of
advertising effectiveness.
3.2 TheoreticalFoundationof the Study
Emotional appeals in advertising theory and classical conditioning theory in learning
consumer behaviour form the theoretical basis of this study. Extensive academic
research has been conducted on the psychology of emotion (e.g., Lazarus 1984)
and the ways in which ad-evoked feelings may influence consumer response to
marketing communication.
Scholars have also observed that advertising may evoke both positive and negative
emotions when seeking to persuade. Indeed, Brown, Homer and Inman (1998,
p.115), suggest that from a practical perspective, “the relative strength of positive
and negative feeling effects potentially could guide advertisers’ decisions regarding
executional strategies.”
It has been suggested that ads use positive affect to make consumers like the ad
And then buy the product, and negative affect to evoke an uncomfortable state that
Makes consumers want the “solution” offered by the advertiser. Unfortunately, there are no
guarantees that what the consumer
actually experiences will be the affective response the advertiser intended to create:
Research has shown that this kind of mismatch between advertiser intentions and
consumer response occurs all too often.
Classical conditioning is often referred to as a means in which humans learn by
association. In the classical conditioning paradigm, Pavlov’s Dog, a neutral stimulus

is paired with an unconditioned stimulus to elicit an unconditioned response. For
example, after repeated pairings of meat (known to cause salivation) with the sound
of a bell, the sound of a bell alone elicits salivation. This association is dependent on
two characteristics of the association: contiguity and frequency. The law of contiguity
states that in order for associative learning to take place, the unconditioned stimulus
and the neutral stimulus must be paired close in time to each other. Furthermore, it is
not enough for a neutral stimulus and an unconditioned stimulus to simply co-exist in
a close period of time. The more frequent the pairing, the easier it is to form an
association.
Proponents of applying classical conditioning to marketing believe that the
association between a product and positive stimuli may help explain the effect of
many variables in communication and attitude change. It tested the
effects of a positive unconditioned stimulus on product preference. His results
support the notion that the simple association between a product (conditioned
stimulus) and another stimulus such as music (unconditioned stimulus) can affect
product preferences as measured by product choice.
However, these effects were diminished in situations where consumers were in a
clear decision making mode. The learning’s of classical conditioning give us some
insight on the characteristics of an effectively branded Internet advertisement. First
and foremost, the frequency with which an ad is served impacts brand awareness.
Frequency also impacts whether or not, an association between a message and a
brand, is made by a consumer.

3.3 Internet Advertising
As a new advertising channel the Internet and particularly the World Wide Web
(WWW) portion of the Internet, are challenging traditional forms of mass media
advertising (Hoffman and Novak, 1996; Hearn, Mandeville and Anthony, 1998).
Meeker (1998) defines a mass communication medium as the communication from
“one person or group of persons through a transmitting device (a medium) to a large
audience or market”. The Internet offers an interactive alternative to mass media
communication through the use of web pages, discussion groups and email
(Hoffman and Novak, 1996).
A significant advantage for advertisers will be the opportunity to communicate more
directly with individual consumers through this medium. Marketers will also be able
to promote their products and services in a personalized, targeted manner to
interested people within their target market. Importantly, wastage of advertising and
marketing funds often experienced when exposing promotional messages to the
mass market, may be reduced as a result of using this new interactive medium.
Advertisers will need to re-address their techniques, services and agency structure
and evolve need communication strategies for the Internet as market share is being
lost to this more personalized, interactive form of Internet advertising.
(1999) surveyed a national sample of over 400 participants and found
no majority opinion of Internet advertising-about a third of the participants liked,
disliked, and felt neutrally toward Internet advertising respectively. The Internet users
found online advertising was informative but less entertaining, and it did not
encourage them to make purchases even they did not perceive it to increase product
prices. they examined the differences between heavy,
medium, and light web users and concluded that “heavier users hold stronger beliefs
about and attitudes toward Web advertising which likely lead to stronger purchase

intent” (p: 201). Comparing with lighter users, the heavy Internet users believed that
web ads were more believable, entertaining, informative and helpful; but harder to
understand. They perceived that web advertising was a good thing, moderately
essential, and it reduced the cost of products. Marketers should include web
advertising in their promotion efforts but the ads should be designed with the
respective user groups in mind.
3.4 Integrated Marketing Communication
The Internet has contributed to a greater adoption of integrated marketing
communication (IMC) strategies, by allowing marketers to communicate more
directly with individual consumers (Low, 2000). Internet functions become integrated
into a company’s communications mix, which permits the operation of the Internet as
an advertising medium to be incorporated alongside more traditional media types.
The application of the IMC concept involves the progression away from the
traditional one-to-many marketing communication model for mass media to the one-
to-one communication, or many-to-many communication model (as illustrated in
Figure 2.2) (Hoffman and Novak, 1996).
The inclusion of the Internet in the promotional mix will not eliminate the use of mass
media advertising channels such as television, radio, newspapers and magazines.
However, the Internet may reduce the amount of mass media advertising required.
Arguably, this will occur because the personal computer with Internet access is being
utilized frequently by target audience members as an effective communication
channel to make both social exchanges using email and commercial exchanges to
purchase products on the web. The advertising industry is being challenged to create
more direct, personal and interactive communication with the target market through
the use of the Internet.

3.5 Effectiveness ofInternet Advertising
Various researchers have studied numerous factors that might have an impact on
Internet advertising recall. The factors include ad characteristics, Internet users’
viewing mode and duration of viewing, campaign publicity, attitudes toward the web
site or ad, and curiosity and innovative advertising strategy2003.
Mullarkey (2003) examined the effects of such factors as viewing mode, visit
duration, text and page background complexity, and the style of banner ads on both
aided and unaided recall. The authors did not find any significant impact of the web
site context factors on advertising recall. The key finding was that the duration of
page viewing is a strong determinant of the ability to recall banner ads; however, a
minimum level of exposure (around 40 seconds per page) is required to achieve a
reasonable level of advertising recall.
3.6 Internet Advertising and Consumer Behaviour
The evolution of the Internet as a global communication infrastructure (Cae, 2000)
has created a new advertising channel for advertisers and advertising agencies to
utilize and will provide advertisers with the means to more cost effectively target them
promotional messages to consumers. Psychological factors such as thinking, feeling,
sensation, and intuition directly correlate with customers’ online advertising
experience. Companies should aim to strengthen customer interactions with
advertisements on the Web, keeping both context and cognition in mind.
Unfortunately, most companies provide a generic experience to all customers rather
than relying on customer analysis to deliver a personalized experience. They’ve
failed to innovate and bring the online advertising experience to a whole new level of
interaction and integration that would truly let them achieve effective communication.

When customers weigh benefits, they become emotionally involved with advertising
and promotion. Consumers identify ways the product or service can make them
happier, improve their lives or give them pleasure. This part of the consumer
response is irrational and can lead to impulse buying and competition to obtain the
product.
Repeated advertising messages affect consumer behaviour. This repetition serves as
a reminder to the consumer. Behaviour that stems from reminders includes suddenly
thinking of a product while shopping and making a decision to buy it, as if it had been
on the consumer’s "to-do" list (Lee 2002).
Consumer behaviour splits between loyalty and alienation depending on how well the
product lives up to its advertised benefits (Thorson, 2000). Corporate behaviour –
such as scandals or charity work – can also affect alienation and loyalty responses.
Once the consumer makes this choice, advertising and promotion are not likely to
undo that decision. The Cannon-Bard Theory that Walter Cannon and Philip Bard
advocated suggests human beings feel emotions first, and then act upon them.
When customers visit a Web site, the ads they encounter evoke an emotional
response—before they even decide what their next step should be. If ads don’t
trigger customers’ emotions, they may not take any action in response.
Based on the review of the research studies mentioned above, it is clear that Internet
advertising is gaining much attention and should be an essential part of a marketer’s
advertising media mix. The inconclusive findings call for further studies on Internet
advertising to gain more insight into consumers’ response and perception of the
Internet as an advertising medium. Hence, this study determined the effectiveness of
internet advertising as an ad medium, and its relationship to consumers’ response

CHAPTER FOUR
RESEARCH METHODOLOGY
This chapter focuses on research methodology that was used in the study. It
provides a detailed description of the research approach adopted in this study.
Research design, target population, research instruments, data collection and
analysis methods used were presented in the subsequent sections.
4.1 ResearchDesign
This study used descriptive research. Descriptive research involves gathering data
that describe events and then organizes, tabulates, depicts, and describes the data
collection (Glass & Hopkins, 1984). It often uses visual aids such as graphs and
charts to aid the reader in understanding the data distribution and therefore offered a
better clarification on online advertising, and ultimately give a clear picture on the
effectiveness and reliability of online advertising and its relationship to purchase
decision.
4.2 Data Collection
The research made use of primary data and Secondary data, which was collected
using structured questionnaire distributed to the 100 respondents. The administered
questionnaires were collected after completion by the respondents on the same day
and them responses used for analysis. The questionnaire had both open ended
questions to enable guide the respondent through filling of the questionnaire as well
as probe them for more information. The secondary data was collected from articles

4.3 Validity and Reliability
Content validity refers to the extent to which an instrument represents the factors
under study. To achieve content validity, questionnaires included a variety of
questions on the knowledge of students on internet advertising and consumer
behaviour. All the subjects completed the questionnaires in the presence of the
researcher. This was done to prevent subjects from giving questionnaires to other
people to complete on their behalf.
Reliability can be ensured by minimizing sources of measurement error like data
collector bias. Data collector bias was minimized by the researcher’s being the only
one to administer the questionnaires, and standardizing conditions such as exhibiting
similar personal attributes to all respondents, e.g., friendliness and support. Pilot
testing was carried out by the researcher to identify any flaws on the questionnaire to
reduce errors of measurement and test for consistency.

4.4 Data Analysis
The study applied both nominal and ordinal scale to measure a range of factors
establishing the effectiveness of internet advertising on consumer behaviour and an
interval scale in determining the relationship between internet advertising and
consumer behaviour. Descriptive statistics was used to analyse this data. The mean
responses, standard deviation and other relevant statistics were computed to better
understand the data. The data collected was compiled and edited to check for logical
inconsistencies. The data was then coded according to the responses. Relationships
between responses was assessed and presented using tables and graphs and
analysis. Regression and Correlation analysis was applied in this study to reveal
relationships among variables in the findings from the data.

CHAPTER FIVE
Data analysis and Interpretation of Data.
This chapter presents analysis and findings of the study as set out in the research
methodology. The results were presented on the impact of online advertising
on consumer buying behaviour towards smartphones. The study objectives were;
1. To understand the core concept of Online Advertising.
2. To Study the effect on Consumer Behaviour.
3. To find out what influenced customer’s buying decision.
Buyers decision process study targeted 100 respondents out of which all the
100 respondents responded and returned their questionnaires contributing to a
response rate of 100%. This response rate was sufficient. Reporting; a rate of 60% is
good while a response rate of 70% and over is excellent.
This commendable response rate was due to extra efforts that were made via
courtesy calls made to remind the respondents to fill-in and return the
questionnaires. The chapter covers the demographic information, and the findings
based on the objectives. The findings were then presented in tables, graphs and
charts as appropriate with explanations being given in prose thereafter.

Primary Data and Secondary Analysis:
The above graph shows how many hours spend by the consumer on an average on internet. We can see that
40% people send around 5hours on internet where as 25% people send around 1hr to 2hr and 4hr to 5hr
respectively.
The show does people pay attention on online advertisement. We can see that almost 65% people
pay attention on various Ads whereas only 35% don’t pay attention.
40%
25%
10%
25%
On average, how many hours do you spend on the Internet
per day?
<1hr 1hr to 2hrs 3hr to 4hrs 4hrs to 5hrs above 5hrs
35%
65%
Do you pay attention to online advertising?
yes
no

The graph depicts liking of advertisement in regards to mobile phones we can see that 72% like
the various ads whereas rest 28% don’t like it.
The graphs shows 75% people are highly influenced where as 15% have medium influenced and
10% are not influenced.
72%
28%
YES N O
DO YOU LIKE ADVERTISEMENT REGARDS TO
MOBILE PHONES ?
Do you like advertisement regards to Mobile phones ?
large influence
75%
meduim influence
15%
Not likely
10%
How much influence do you feel
advertisements have over your buying
behavior?
large influence
meduim influence
Not likely

The graph depicts 50% of people think advertisement as informative where as 20% think they are
creating awareness and annoying. The rest 10% think they are waste of time
The bar graph shows 55% people are likely to make purchase after seeing an advertisement
whereas rest 45% don’t agree for making purchase decision
50%
20%
20%
10%
How you find such advertisements?
informative
creating Awareness
annoying
waste of time
55%
45%
YES N O
HAVE YOU MADE ANY PURCHASES AFTER
SEEING INTERNET ADS?
Have you made any purchases after seeing internet ads?

More than 60% people agree thinking online ads are beneficial for important
For providing information about the products and services whereas 15% disagree
And 20% are not sure.
According to graph 70% people think they had made unnecessary purchase because of online ads
where 25% disagree and rest 5% are not sure.
0%
10%
20%
30%
40%
50%
60%
70%
I agree I disagree not sure
Advertising is beneficial to consumers becauseit provides
importantinformation about goods and services.’To what
extent do you agreewith this statement?
Advertising is beneficial to consumers because it provides important information about goods and
services.’Towhat extent doyou agree withthis statement?
70%
25%
5%
Do you agree that people become victims of
Advertising by purchasing unnecessary
product?
I agree I disagree Not sure

The bar graph shows around 42% of people agree they likely to buy cell phones by watching ads
where as 34% disagree and the rest 21% are not sure.
0%
10%
20%
30%
40%
50%
I agree I disagree not sure
‘The moretimes an advertisementof new mobile phones is
viewed by a consumer, the more likely the consumer is to
go and buy the product.’To whatextent do you agreewith
this statement?
‘The more times anadvertisement of newmobile phonesis viewedbya consumer, the more likelythe
consumer is to goandbuythe product.’To what extent do youagree withthisstatement?
0 10 20 30 40 50 60 70 80
PRODUCT INFORMATION
PRICE INFORMATION
CELEBRITIESAND FAMOUS PEOPLE
COSTUMER REVIEWS
DISCOUNTS AND DEALS
What do you look out for in an mobile phone
advertisement?
Series 1

The bar shows 70% people buy phones depending upon the reviews of other customer where as
35% make purchase depend on celebrity endorsement, 25% make purchase depending upon
quality of product and 20% and 10% people make purchase decision depending information about
the product and discount and deals.
Around 45% people are influenced by YouTube ads and 35% are influenced by ads on Facebook
and 15% are influenced by banner ads on their website where as just 5% are influenced by twitter
ads.
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
facebook ads youtube ads Twitter ads Banner adverts
Which methods of online advertising are mostinfluential
on your buying behaviour?
Which methods of online advertising are most influential on yourbuying behaviour?

Secondary Data Analysis:
 80% of internet users own a smartphone (Source: Smart Insights, 2015)
 By 2018, eMarketer estimates over one-third of consumers worldwide, or more than 2.56
billion people will be smartphone owners. That 2018 figure also represents over half-51.7%
– of all mobile phone users. (Source: e Marketer)
 84% of small businesses who have invested in a mobile presence say that they see
immediate and long-term benefits (Source: Web.com)
 According to Google’s Mobile Search Moments Study, 40% of mobile searches have local
intent. Similarly, 77% of mobile searches occur at home or at work, while 17% is on the go.
(Source: Google Mobile Search Moments Study)
 According to a recent study, mobile internet traffic reached 60%, surpassing desktop
internet traffic which declined to 40%. (Source: CNET)
 84 percent of small businesses that are using mobile marketing methods report increases in
new customers. (Source: Marketing Zone)
 There are officially more mobile devices than people in the world. The world is home to 7.2
million gadgets, and they’re multiplying five times faster than we are. (Source: The
Independent, 2014)
 Mobile Marketing will generate $400 billion in 2014 (Source: Mobile Marketing Association)
 Mobile Ad Spending will top $160 billion worldwide by 2018, taking over 65% of the digital
market. (Source: E-Marketer)
 Mobile commerce will account for 24.4% of overall ecommerce revenues by the end of
2017. (Source: CMO Council)
 Android expected to have 31% market share by 2016 (Source: IDC)
Mobile Device Usage Statistics
 70% of all mobile searches result in an action within an hour. (Source: Forbes)
 75% of shoppers admitted to using their mobile device while shopping in store (Source: In
Reality)
 70% of mobile searchers click to call a business directly from Google’s search results
(Source: Search Engine Watch)
 53% of American consumers use their smartphones to access search engines at least once
a day (Source: Google and Mobile Marketing Association Survey)
 Globally, 80% of consumers have used computers to access the Web within the previous
seven days. Sixty percent used their mobile devices to do so (Source: Google and the
Mobile Marketing Association Survey)
 Some analysed the mobile capabilities of the top 50 high street retailers finding that: 40%
do not have a mobile optimized store locator, 20% don’t have a transactional mobile site,
46% don’t support responsive web design (Source: E-consultancy)
 68% of people use a mobile device to look up a store address (Source: Social Light)
 96% of new smartphones sold are either iPhone or Android Devices (Source: The Verge)
 91% of Smartphone users keep their phone within arm’s length. (Source: Forbes)

 52% of mobile users check the prices of an item online they wish to buy. (Source: Business
On)
 90% of consumers say buying decisions are influenced by online reviews (Source:
Marketing Land)
 86% of mobile internet users use their mobile device while watching TV, with 37% of those
browsing the internet for non-related TV material (Source: Yahoo)
 25% of US mobile web users only access the web from their mobile phones (Source: On
Device Research, as reported by MobiThinking)
 60% of global mobile consumers use their mobile device as their primary or exclusive
internet source (Source: Internet Retailer)
 25% of smartphone owners ages 18-44 can’t remember the last time their phone wasn’t
next to them (Source: Fast Company)
 Smartphone users spend an average of 60 minutes a day. iPhone users average 90
minutes a day. (Source: Experian)
 Wi-Fi has become the medium of choice. 2/3 of US consumers prefer Wi-Fi to Cellular.
(Source: Deloitte)
 By 2020, it is predicted that 24 Billion devices will be connected to the Internet. The vast
majority will use some form of wireless for access.
Mobile Websites Statistics
 55% of all searches are from mobile devices (Source: eReachConsulting)
 60% of global mobile consumers use their mobile device as their primary or exclusive
internet source (Source: Internet Retailer)
 “I’m out here.” 60% of mobile users expect a site to load in 3 seconds or less. 74% are
willing to wait only 5 seconds for a site to load before leaving. (Source: Compuware.com)
 48% of users say that if they arrive on a business site that is not mobile optimized, they
take it as an indication of the business not caring (Source: Margin Media)
 95% of smartphone users have used their phone to look up local information. After doing
so, 61% called and 59% visited. (Source: Forbes)
 50% of all mobile searches are conducted in hopes of finding local results (Source:
SearchEngineWatch)
 61% of local searches result in a purchase (Source: Business2community)
 50% of mobile users visit a store within a day after conducting a local search (Source:
Google)

Loyalty Programs and Rewards Statistics
 78% of consumer’s report being either “frequently” or “sometimes” influenced by coupons
(Source: FirstDataCanada)
 Mobile Coupons receive 10x higher redemption rates than print coupons (Source:
GoMobileBook.com)
 56% of smartphone users want to receive location-based offers on their phones when they
are near a store (Source: FirstDataCanada)
 89% of consumers carry at least one merchant loyalty program card in their wallet (Source:
Imprint)
 40% of shoppers look for offers on their mobile devices while in store (Source: Millennial
Media)
 48% of consumers say that the most critical time to gain their loyalty is when they make
their first purchase or begin service. (Source: Click Fox)
 Returning customers spend on average 67% more than first-time customers. (Source: Bain
and Company)
 Up to 15% of a business’s most loyal customers account for 55-70% of the company’s total
sales. (Source: The Centre for Retail Management at North-western University)
 Only 34% of SMB owners have any loyalty program at all, and of those who do, the majority
are offline. (Source: BIAKelsey)
 78% of consumers are not yet loyal to a particular brand. (Source: Nielsen)
 94% of loyalty program members want communications from the programs they participate
in. (Source: Maritz)
 Thirty-eight percent of marketers identified their biggest challenge in 2015 as improving
customer acquisition and retention. (Source: Teradata)
 Online content drives 62% of millennials to brand loyalty. (Source: NewsCred)
 73% of smartphone users are interested in interacting with their programs through their
mobile device. (Source: Maritz)
 61% of SMBs report that more than half of their revenue comes from repeat customers,
rather than new business. (Source: BIAKelsey)
 Socially connected loyalty program members have an 18% lift in spend. (Source: Crowd
Twist)
 63% of women and 53% of men say they will stay with a brand longer when earning
rewards. (Source: Cherry London)
 69% of consumers say choice of retailer is influenced by where they can earn customer
loyalty/rewards program points. (Source: Maritz)
 73% of smartphone users are interested in interacting with their programs through their
mobile device. (Source: Maritz)
 Mobile offers are redeemed 10x more frequently than print offers. (Source: eMarketer)
 A 2% increase in customer retention has the same impact as decreasing costs by 10%
(Source: Hub Spot)


Wi-Fi Marketing Statistics
 60% of people can’t go without Wi-Fi for more than 1 day; 75% of people say 1 week
without Wi-Fi would leave them grumpier than 1 week without coffee (Source: Iconic
Displays)
 62% of local business customers spend more time in store if Wi-Fi is available (Source:
iGR)
 Businesses who offer free Wi-Fi to boost sales numbers have a success rate of 72%
(Source: iGR)
 75% of businesses say they consider free wireless access to be either “important” or “very
important” to their business now. (Source: iGR)
 64% of consumers make a restaurant choice based on availability of Wi-Fi services
(Source: Accenture)
 79% of even the least Wi-Fi Interested shoppers, age 45+ are positively influences by in-
store Wi-Fi availability (Source: Accenture)
 78% of Facebook users are mobile-only (Source: CMO Council)
 56% of social network users have stated they would use their social profiles to login in
return for a customized experience with a brand. (Source: CMO Council)
 74% of people would be happy for a retailer to send a text or email with promotions while
they’re using in-store Wi-Fi (Source: OnDeviceResearch)
 Up to 70% of consumers in-store have a Wi-Fi capable device in their pocket (Source:
Retail Touch Points)
 64% of hotels now offer free Wi-Fi. (Source: Hotel Chatter)
 50% of consumers feel comfortable making a large purchase in-store if Wi-Fi access is
available. (Source: Accenture)
 By 2017, 60% of carrier network traffic will be offloaded to Wi-Fi. (Source: Wireless
Broadband Association)
 71% of all mobile communications flows over Wi-Fi. (Source: Wi-Fi Alliance)

Mobile Commerce and EngagementStatistics
 71% of consumers receiving a quick brand response on social media say they would likely
recommend that brand to others (Source: Forbes)
 80% of shoppers admit that they’re more likely to purchase from and interact with a brand
that offers an engaging mobile experience (Source: Huffington Post)
 78% of small businesses attract new customers through social media (Source: Relevanza)
 62% of shopper’s search for deals digitally for at least half of their shopping trips (Source:
MA/Booz & Company Shopper Survey)
 55% of US Internet users will redeem a digital coupon or code at least once per year
(Source: Digital Marketer)
 80 percent of mobile users prefer locally relevant advertising and 75 percent are more likely
to take an action after seeing a location-specific message (Source: Mobile Audience
Insights Report from JiWire)
 iTunes App Store now has 1.2 million apps, and has seen 75 billion downloads to date
(Source: TechCrunch)
 Forty-two percent of m-commerce sales come through apps (Source: Internet Retailer)
 Mobile app store revenues worldwide are projected to grow to US $76.5 billion in 2017
(Source: CMO Council)
 44% of consumers say that they would like brands to deliver deals and coupons to their
mobile devices (Source: CMO Council)
 53% of the “on-the-go” U.S. audience is willing to exchange their location in exchange for
more relevant content and better information, including mobile deals (Source: JiWire)
 More than 33.3 million U.S. consumers already engage in shopping-related activities on
their mobile phones, 7%, or 2.3 million, of those consumers have made a purchase on their
devices, the report finds (Source: Experian Simmons, Mobile Consumer Report)
 87% of millennials always have their smartphone at their side, day and night. 78% of
millennials spend over 2 hours a day using their smartphones. 68% of millennials consider
their smartphone to be a personal device (Source: CMO Council)
 46 percent of consumers have used their phone to get product information while in a store
(Source: Briabe Media)
 56 percent of people believe mobile can make the shopping experience more enjoyable
(Source: Light speed Research)
 13.1 million consumers access retail content via mobile phones with 8.2 million of those
visiting mobile commerce websites (Source: comScore/Millennial Media Mobile Retail
Study)
 67 percent of retailers see value of having customers use their smartphones within the
store and 41 percent said they perceive a lot of value in mobile in-store (Source: RSR
Research)
 Within the 49% of mobile users who have made a mobile purchase in the last six months,
84% look for local retailer information, 82% find online retailers, 73% find a specific
manufacturer or product website, 71% learn about a product or service after seeing an ad,
68% find the best price for a product or service, and 63% search before purchasing in a
store or from a catalogue (Source: Performers Mobile Search Insights Study, conducted by
ROI Research)
 75% of heavy mobile users said mobile search makes their lives easier, 63% said access to
mobile search has changed the way they gather information, and 32% said they use mobile

search more than search engines on their computers (Source: Performers Mobile Search
Insights Study, conducted by ROI Research)
 Over 70% of iPhone owners report using applications or their smartphone’s web browser to
help them while shopping in-store, and 41% are making purchases directly from their
phones (Source: Chadwick Martin Bailey and iModerate Research Technologies)
 78-84% of consumers now rely on their social networks when researching new products
(Source: IBM Report)
 62% of smartphone users said they have purchased physical goods from their mobile
devices in the last six months (Source: Adobe Survey)
 69% of retail executives said mobile is an important strategic initiative (Source: NRF)
 79% of smartphone users found it useful to download mobile coupons to their phones
(Source: Accenture, reported by Internet Retailer)
 73% of consumers find it useful to receive an instant coupon as they pass by an item in a
store (Source: Accenture, reported by Internet Retailer)
 56% of shoppers with smartphones believe using their phone during the shopping
experience will make it more enjoyable (Source: Accenture, reported by Internet Retailer)
 73% of shoppers with smartphones prefer to reference their mobile device while in-store
rather than ask a sales associate for help (Source: Accenture, reported by Internet Retailer)
 71% of Generation Y respondents (approximately 16-31 years old) said they use mobile
coupons to get e-commerce discounts (Source: Cognizant Technology Solutions and RIS
News)
SMS Statistics
 SMS coupons are redeemed 8% more than emailed coupons (Source: CMO Council)
 98% of all SMS messages are opened, but only 20 per cent of emails are looked at
(Source: Venture Beat)
 99% of text messages are read and responded to within 90 seconds of receiving them
(Source: DigitalMarketingMagazine)
 SMS sees an engagement rate 6-8 times higher than email marketing (Source:
60secondmarketer)
 Brands using SMS successfully reach 95% of smartphone and non-smartphone users.
(Source: GoMoNews.com)
 90% of users who enrol in an SMS loyalty program feel they gained value from it.

CHAPTER SIX
Swot Analysis
SWOT is an acronym for strengths, weaknesses, opportunities and threats. When
you do a SWOT analysis on your advertising agency, you must address all four
categories. This is important not only for your business planning but also for
presenting your case to lenders. They will want to see that you have addressed both
the negatives and positives of your advertising enterprise. Your SWOT analysis can
help you compete by emphasizing positives and neutralizing negatives.
Strengthsof this research:
– Easy to target and reach more audience at a cheaper price.
– Campaigns can be easily customized and made more targeted as per our business
requirements.
– As the world is more dependent on the internet, it helps the business to reach out and
connect with the people on a larger scale.
– Saves a lot of money as compared to the traditional way of marketing as it is cheaper and
efficient.
– Being recognized as a brand has become much easier.
– The options are not confined to one or two, there are many options and people can choose
to switch from one to the other if PLAN A doesn’t work and that does not cost a great loss of
money.
– Promotion of small business is easy as it is cost effective.
– Entrepreneurs find it very useful as they do not need a huge budget for this and it gives
them huge platform to make a mark on the digital world.

Weakness:
– A challenge to reach the population which is still not using the internet.
– High chances of failure of internet marketing campaigns because of confusion due to the
availability of many different marketing options.
– Keeping pace with new trends and technology.
– Need of deep understanding of changing human behaviour and requirements.
– If your brand or product is not justifying the users need, then the chance of getting bad
reviews in public is very high, which in turn might damage the reputation.
Opportunities:
– More and More employment for the youth as this field is just growing and number of
professionals are less.
– Increase the reach of your brand, therefore, leading to direct profit.
– There are lot of ways through which owners earn money apart from their primary business,
eg- giving space for ads on website, affiliate marketing in e commerce etc.
Threats:
– If it doesn’t work perfectly then chances of back fire is higher i.e. it might damage the brand
name.
– Due to ever changing trends of different marketing areas and ever changing rules of
search engine for optimizing the content, continuous awareness is required, which is very difficult.
– Storage of data with full security is still a big question mark.
– Analysing the data in a wrong way can lead to damaging results which is found in a lot of
companies.

CHAPTER SEVEN
Challenges faced by Online Advertising Industry in India:
World sees India, as the next place to be in and investing in its youth, the online marketers
face surmounting challenges from all sides. When you look at a pessimistic way, I see lots of
challenges. Take a break, come back and look again, you see lots of positives and feel thrill
about it. On a marketing perspective, I have clubbed some of challenges the digital
marketers in India face today or may be in near future
Educating the client: Do you prefer to have a good client? Take some time and effort
to educate them on digital marketing. Having a huge budget earmarked for digital media
or just having a Facebook page is not going to help anyways. It’s easy to entice and
convince client with digital parlance, but on long-term you will have a disappointed and
grumpy client. No agency would prefer that. Extra effort to train client will pay you on
long-term.
Engagement is the fundamental:
“Half the money I spend on advertising is wasted; the trouble is I don’t know which half” as
quipped by John Wanamaker long time ago doesn’t hold in digital marketing as such. We
spend, measure and improvise here with the watchword ROI. Here is the trouble in disguise-
let go off the engagement factor. When I mean engagement, it’s not about the impressions,
reach or SOV, but it’s more of intangible and broadly AIDA.

Diversity-
East to West, North to South, planning for a nationwide campaign or at a regional level,
the interest, culture and tastes vary and is very visible in any digital platform. This is a
debatable issue, as people use internet in the universal language English and covers the
educated middle and upper class. True, but local flavours rule the roost. Take any
successful marketing campaign in offline, we get the connect. Going forward where
smart phones and mobile penetration will be higher than broadband, Digital Marketers
have many platforms opened up to experiment? The challenge and success depends on
understanding the diversity.
Matrices Vs Creativity:
Loads of data are available once a digital campaign is running or even while at the
planning stage. Obsessed with data and its interpretation may lead to overlooking
creativity by digital marketer. Coming up with really out-of-the-box idea or replicating
some successful campaign or even tweaking an already successful campaign to get
more leverage or any other viable options, should have proper balance with creativity
and matrices.

Getting it Integrated:
Any digital campaign with its well defined goals have many platforms- e-mailers, sms, ad
words, special promotions on Social media and SEO and ORM which area long-term
affair and many more to come in future. Each of these platforms has its own perils and
should be approached with its own expertise. Thankfully, at present there are agencies
/individuals who have expertise in each area and all a good Digital Marketer has to do is
get it integrated.
Other challenges:
Everyone knows that targeting your audience doubles your chances of success. The aim of
every advertising campaign is to reach customers while avoiding those who are not interested,
but the reach of the internet is so huge that this not an easy task. It is also not easy to check if
you are indeed, reaching your target audience or not. Measuring the ROI or impact of your
advertisement is another grey area in online advertising? The click through rate has been used
as a metric of measuring success, but it is hardly a fool proof method

Another challenge faced by online advertisers is the rise and rise of the mobile internet
user. Internet use on mobiles and tablets is set to overtake desktop internet use soon. The fact is
that revenues generated from advertising on mobile devices are lower than revenues for desktop
advertisements. Not only that, the format for creating an ad on a desktop is different from that
required for tablets, which is in turn different from the format required for a smart phone. This
means that you essentially need to develop different ads for all three different platforms. The
good thing is that with every challenge comes an opportunity too. The fact that a phone can
pinpoint a persons’ location is a huge advantage for advertisers. It enables them to send ads that
are relevant to the location. A few months’ back UTuneMe, an internet radio app that allows you
to hear audio broadcasts from all over the world, launched a geo-targeted mobile ad platform.
Advertisers using this app can now deliver ad content based on the user’s location. This makes
the ad content received by the user a whole lot more effective and relevant.

CHAPTER EIGHT
Summary, Conclusion and Recommendation
8.1 Introduction
This chapter presents summary of findings, conclusion and recommendations of the
study in line with the objectives of the study.
8.2 Summaryof the Study
The study found that the effectiveness of internet advertising on reach and creation
of awareness was determined by the level of knowledge about the existing platforms
of advertisements and time spent on these media. On average, a person spent more
than4 hours on the internet during his free time than that of TV and movies and print
medium and therefore the reach of internet medium is much better than that of other
media. A higher percentage indicated that they were made aware of existence of
various products through internet advertising and therefore it was effective in
creating awareness. The study revealed that the ability of the respondents to recall
the internet ads were low compared to TV, and therefore even though the reach of
internet is much higher than other forms, TV ads are much more reliable than
internet advertising.
Internet advertising is a key determinant of purchase decision of the customers as
they consider it to be an interaction point between them and the company from which
they buy their products from. The study also established that internet advertising has
significant relationship with purchase decision of the consumers. From the Pearson’s
correlations analysis, the study established that there is a positive relationship
between consumer behaviour and internet advertising.

Conclusion
The objective of the study was to determine the impact of online advertising
on consumer behaviour using a sample of various students. After analysis of the
study findings, the study concludes that the impact of internet on reach and
creation of awareness was determined by the level of knowledge about the
existing platforms of advertisements adopted by various companies in India and
time spent on various media. Internet advertising was effective in providing higher
reach and creation of awareness. However, in spite of the diverse usage of internet
and wide interaction with various internet advertisements, fewer respondents were
able to recall the internet ads they had seen. This implies that the reliability of
internet advertising is quite low. The research established that TV advertising is
more reliable than internet advertising therefore conforming that TV ads are much
reliable than internet advertising. The study concludes that online advertising
influenced purchase decision of the customers to a moderate extent as only nearly
half of the respondents were influenced purchase decision. However, internet
advertising is a key determinant of purchase decision of the customers as they
consider it to be an interaction point between them and the company from which they
buy their products from. The study also concludes that internet advertising has
significant relationship with purchase decision of the consumers. The study further
concludes that internet advertising contributes most tithe consumer behaviour and
that internet advertising was a significant factor in predicting the consumer
behaviour. In addition, there is a positive relationship between consumer behaviour
and internet advertising. This implies that companies should invest more in internet
advertising to increase their market share and conduct market research on the
different markets in various countries to ensure that the internet advertising initiatives
being implemented suits the targeted markets to improve product purchases.

Recommendations
The study established that the reliability of internet advertising is low and therefore
recommends that the management of companies using internet advertising should
provide unique experience to its customers based on customer analysis to deliver a
personalized experience to the customers, the study also found that
internet advertising is effective in reach and creation of awareness and recommends
that the companies should invest more in internet advertising to increase them
market share and provide product information. Finally, the study determined that
there is a positive relationship between internet advertising and consumer purchase
decision and further recommends that companies should conduct a market research
on the different markets in various countries ensure that the internet advertising
initiatives being implemented suits the targeted markets to improve product
purchases.

CHAPTER NINE
Annexure
Questionnaire on The impact of Internet advertisement on consumer behaviour
towards mobile phones.
1. On average, how many hours do you spend on the Internet per day?
o <1hr
o 1hr to 2 hr
o 3hrs to 4hrs
o 4hrs to 5hrs
o above 5hrs
2. Do you pay attention to online advertising?
o Yes
o No
3. Do you like advertisement regards to Mobile phones?
o Yes
o No
4. How you find such advertisements?
o Informative
o Creates awareness
o Irritating
o Waste of time
5. How much influence do you feel advertisements have over your buying
behaviour?
o Large influence
o medium influence
o Not sure

6. Have you made any purchases after seeing internet ads?
o yes
o no
7. ‘Advertising is beneficial to consumers because it provides important
information about goods and services.‘To what extent do you agree with this
statement?
o I agree
o I disagree
o not sure
8. Do you agree that people become victims of Advertising by purchasing
unnecessary product?
o I agree
o I disagree
o not sur
9. ‘The more times an advertisement of new mobile phones is viewed by a
consumer, the more likely the consumer is to go and buy the product. ‘To
what extent do you agree with this statement?
o I Agree
o I Disagree
o Not sure
10.The Advertising is beneficial to consumers because it provides important
information about goods and services.’ do you agree with this statement?
o Yes, I agree
o No, I disagree
o Not sure
11. What do you look out for in a mobile phone advertisement?
o Product information
o Price information
o Celebrities and famous people
o Discounts and deals
o Costumer reviews
o Other
CHAPTER TEN

Bibliography:
 The following are the list of the website that were used in
completing this research project: -
 www.google.com
 www.ask.com
 www.wikipedia.com
 www.marketingland.com
 www.business.com
 www.linkedin.com
 www.knowonlineadvertising.com
Apart from these websites and use of internet, various articles and books and
newspaper were referred and have played major contribution in the completionof
project

The impact of online advertising on consumer buying behaviour towards mobile phones

The impact of online advertising on consumer buying behaviour towards mobile phones

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