From the June 2002 issue of Entrepreneur

We've all encountered those ads that pop up in front of or behind the browser window when we're trying to open a Web page. While consumers generally find these aggressive online advertising formats to be disruptive and even annoying, online marketers are using them more and more. Why?

According to Panos Anastassiadis, president and CEO of Cyveillance, an Arlington, Virginia, company that uses proprietary technology to analyze Web sites, "When the economy is down, businesses will go to great lengths to wring more out of their marketing dollars. It's no surprise to see these tactics emerge into the mainstream."


By 2007,
59%
of Net surfers will be accessing the Web via wireless connections.
SOURCE: Computer Industry Almanac

Advertisers are seeking new ad formats that demonstrate better effectiveness than the static banner ad, which has been the subject of criticism for several years. Analysts report that intrusive tactics are growing in popularity because they usually result in more site visits. "Most evidence we see is that pop-up ads are giving advertisers response rates and a connection that they haven't seen in a long time," says Charles Buchwalter, vice president of media research at Jupiter Media Metrix.

Consider X10 Wireless Technology Inc., based in Seattle, which blanketed the Internet with pop-under ads for its wireless cameras last year. "For better or worse, X10 took the bull by the horns very early on and differentiated itself from competitors in the electronic component business," says Buchwalter.

A study from Cyveillance that analyzed the 100 most popular Internet sites and a representative sample of 100,000 sites last year found 30 percent of the top sites in the United States employ pop-up ads. In fact, 12 percent of all sites on the Internet employ these ads.

Some companies can get away with it. Travel site Orbitz LLC uses pop-up ads offering attractive rates on travel packages. "It's interesting that Orbitz actually doesn't come up on lists of Web sites that show people being offended by pop-up ads," says Buchwalter. "X10's ads, on the other hand, irritate people because of the frequency with which they pop up, and because the ads themselves can be considered a bit racy."

Popping Up

One company that considers pop-up ads a great technique is OneTravel.com, an East Greenville, Pennsylvania, travel Web site that was founded by president/CEO Michael Thomas in 1995. The company, which had sales of $100 million in 2001 and expects that figure to increase between 25 and 30 percent in 2002, regularly uses pop-up ads to cross-sell services on its site. After a consumer purchases a plane ticket, for instance, a pop-up will ask the consumer if he would like to purchase additional services, such as a hotel room or a rental car.

"Cross-selling is a wonderful way to use pop-up ads," says Thomas, 36. "When we bring a pop-up window up, we are helping the consumer think about something he might need that he may not have considered or thought about without the pop-up window."

Susan Jefferson, vice president of sales and marketing at OneTravel.com, says that the company sometimes purchases pop-up ads on other Web sites, but rarely places other companies' pop-up ads on its site. "Basically, we make our money by selling products, not advertising," she says. "We are trying to help somebody through a buying process, and if on page three of the buying process a pop-up ad from another company takes that person off-site, we've done ourselves a disservice."

One company that refuses to use pop-up ads in its advertising--or even have them pop up on its Web site--is Houghtaling's Garage in Middlebury Center, Pennsylvania, a family-owned business in continuous operation for almost 50 years. Now run by 46-year-old Kevin Houghtaling, the garage sells new and used farm, lawn and garden machinery. C.J. Houghtaling, Kevin's wife, was responsible for getting the company online and currently maintains its Web site (www.houghtalingsgarage.com). C.J. built the original site through Tripod.com, a free Web page provider from Terra Lycos. But because pop-up ads automatically come with free hosting services, she decided to switch to a different hosting company. "For us, it's worth it to pay for a service in order to have a nice, professional-looking Web site with no advertisements on it," says C.J., 45.

So will pop-up ads ever duck down? According to Buchwalter, although pop-up ads probably won't go away, over time they may change. "What will probably happen," he says, "is that an innovative ad agency will come up with the next iteration of these pop-up ads that may [retain] some of the more pleasant attributes, and they will be the next big thing."


Melissa Campanelli is a marketing and technology writer in Brooklyn, New York.