Israeli Companies Seek to Revitalize Internet Advertising

JERUSALEM – The new standards for larger Web advertisements, set in February by the Internet Advertising Bureau (IAB) was seen as a response to the eroding effectiveness of traditional banner ads.
The new standards were the first since 1996, when the sizes for the now traditional advertising banner was set. As response rates for these banner ads fell to approximately one in 200, down from one in 50 when they were introduced, the IAB was compelled to act.

Some companies haven’t waited for the IAB decision, and have taken the Internet advertising problem into their own hands. Rather than changing the sizes of the ads, these companies have relied on technological innovations to offer more features to the Internet advertising community.

Three Israeli players in the new generation web advertising field are Coovi, Ad4Ever and Amicada. Each of these companies addresses the problems of today’s Internet advertising from different perspectives, varying in substance and style from one another and the baseline banner advertisements that have accounted for the bulk of online advertising to date.

Coovi’s Web-based infrastructure is targeted at cross-media advertising and sales campaigns. Besides its obvious uses for Internet advertising, Coovi’s model uses a code to allow consumers to capture advertising from newspapers, radio, television and outdoor billboards and save it in a personal Web space.

On the Web, Coovi advertisements can have the appearance of a normal banner – a symbol on the advertisement indicates the ad is Coovi-enabled. Investors have shown faith in Coovi’s vision of cohesive all-media advertising. This week, the Jerusalem-based company closed a $2.5 million round of investment.

While Coovi’s Web ads may be subtle, Ad4Ever believes in a flashier approach. In fact, Ad4Ever’s advertisements greet surfers with a flash animation and sound teaser when a page with their advertisement is loaded. The animation, which moves across a transparent layer over the web page, is small and loads in seconds. After the teaser is shown, a banner is left as a reminder if the user wishes to opt-in for more information. Clicking the reminder can open a small applet with additional information or an input form, all without drawing the user off the original website.

Ad4Ever, based in New York and Ramat Gan, Israel, has had its own successes in gaining industry interest. In January, the company signed a deal with General Motors to apply its TopLayer advertising system to several of the carmaker’s product campaigns. On March 20, Ad4Ever reported click-through rates of 25 percent on its Opel Corsa advertisements.

Some companies envision moving past animation to delivering television commercials to the Internet. Amicada’s streaming technology claims to bring TV advertisements onto the Web, comprising full-motion full-frame video, both online and offline, to end-users over narrow-band connections.

Amicada users choose to receive advertisements through the service. Users are asked whether they would watch ads in return for a reward. Amicada is marketing its service to Internet service providers, which provide the incentives.

The company just released a market research report its commissioned through element, a youth-focused firm in New York. The report said that testers consistently chose to view Amicada advertising, and that its method of online advertising yielded higher click-through rates from the panel.

The company, headquartered in New Jersey with research and development in Ramat Gan, recently announced an agreement with Unilever to show TV ads on the Web as part of a test to assess the effectiveness of Amicada’s system.

The standard for the next generation of Internet advertising may not be clear for some time to come, and for the meantime, companies will continue to develop varying technologies to fill the needs of advertisers, no matter how they prefer to convey their message.

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