webqem blog

emitch Limited (ASX Code: EMI) has appointed Lee Stephens as Chief Executive Officer. Lee has extensive experience in the sales and marketing areas of online advertising. He is a former senior executive with Fairfax Digital and jointly founded a media web development business. Most recently Lee has held a senior executive position with the Federal Publishing Company.

We asked Lee Stephens for his thoughts on the current state of online advertising in Australia:

Why has there been such a huge growth in the past 12-18 months in online advertising?

The growth has been a factor of two quite different trends. Firstly we are seeing particular industries such as consumer finance and travel adopt online as their primary acquisition channel. Companies realise that online is the most efficient way to contact and motivate their target audience(s).

We are seeing online acquisition costs working out to 1/4 the cost of print and cheaper than TV by a factor of 10 with some clients. Secondly, parts of the market are responding to increased competitive pressure, and that is driving online spend. You can see this particularly in the automotive and telecommunications sectors.

I know you recently joined Emitch as CEO? What attracted you to the company?

Emitch is an amazingly focused company. They are single minded in getting the best value for their clients and see online as part of their client’s sales and marketing channels. All the guys work hard to provide value whether it’s a $10,000 campaign or a $1 Million campaign. As a result they have a client list to kill for. The opportunities as a result of this are considerable and I wanted to be a part of it.

The company announced a great mid year result, what’s the secret? What new accounts have come on board?

The result was great but I think we can do better. We are taking a lot of time with our existing clients, showing how we can extend their online activity at a profit – the new initiatives are working for our clients and for Emitch and is showing in our profitability. There are a few new accounts on board but we prefer not to make a song and dance over it – new clients are great but we are only as good as the clients we keep.

Why should marketing directors and agencies be looking at including online advertising in their marcomm spend?

It depends on which industries you are working within but we look for two key characteristics of companies when considering how much of their online budgets should be spent online:
1. How direct is the sales channel and can the purchase decision be made online?
This doesn’t mean whether or not you can buy the product online. What is important to us is whether a company can communicate everything they need for the target audience to make a decision to act. This action might be a phone call or an in-store visit. We also look at the structure and relationship of re-sellers. Sometimes it makes sense to spend more money on re-seller support and less on direct online advertising. We work through these issues and plan media solutions accordingly.
2. How are your target audiences researching their purchases of your products?
If you are in the travel industry you need to be online. It’s not an option. We look very closely with our clients on how their customers are behaving and the online behavioural stages these consumers go through before making a purchase. There are often a couple of stages in the purchase consideration process and these require different advertising responses.

What do you see as the big things in online advertising over the next 12 months?

I think some other major publishers will follow 9MSN to offer a performance solution like Performance Plus. This will probably lead to an increase in the popularity of affiliate marketing networks similar to Linkshare and Commission Junction in the US. This diversity will be good for marketers and agencies in Australia.

We are also in for some consolidation within the industry as large traditional agency groups move to strengthen their online position.

Find out more about emitch.