This is “How It Works”, section 3.2 from the book Online Marketing Essentials (v. 1.0). For details on it (including licensing), click here.

For more information on the source of this book, or why it is available for free, please see the project's home page. You can browse or download additional books there. To download a .zip file containing this book to use offline, simply click here.

Has this book helped you? Consider passing it on:
Creative Commons supports free culture from music to education. Their licenses helped make this book available to you. helps people like you help teachers fund their classroom projects, from art supplies to books to calculators.

3.2 How It Works

Learning Objective

  1. Understand when best to use online advertising.

Advertising, whether online or offline, has a number of objectives:

  • Building brand awarenessMaking sure someone is aware of a brand or product.
  • Creating consumer demandConvinces consumers that they need a product, and why they need it.
  • Informing consumers of the advertiser’s ability to satisfy that demand
  • Driving responseAdvertising that encourages an advertiser to take an immediate action. Also known as direct response. and sales

Building Brand Awareness

Making people aware of a brand or product is an important long-term goal for any marketer. Once customers know about the brand, the marketer has taken the first step toward gaining the customer’s trust and patronage. The better known a brand is, the more business they can do. And the ultimate goal is to do more business and sell more of the product.

Online, creative advertising or bannerAn online advertisement in the form of a graphic image that appears on a Web page. advertising is largely visual, making it an ideal channel for promoting brand collateral.

Creating Consumer Demand

Consumers can’t want what they don’t know about. Advertising needs to convince consumers about what they should want and why they should want it. Modern online advertising provides a great way to communicate the USPs (unique selling points) of a product, thereby helping stimulate demand.

Satisfying Consumer Demand

Once the consumer is aware of and desires a product, they need to find out how to satisfy that desire. If brand building has been effective, they will know that a particular brand exists. At this point, it is important for the marketer to show the consumer how their particular brand or product will best meet that need.

Driving Response and Sales

All forms of online marketing need to drive trafficThis refers to the visitors that visit a Web site. and sales in the long term. However, the immediacy of online advertising also drives traffic and sales in the short and medium terms. Unlike traditional media advertising, online advertising can turn the potential customer into an actual customer right there and then. What’s more, it is possible to measure accurately how effectively the online advertising campaign does this.

The Key Differentiator

Online advertising is able to drive instant sales and conversions. Unlike offline advertising mediums, the consumer can go from advertisement to merchant in one easy click. Because of the connected nature of the Internet, online activities are highly trackable and measurable, which makes it possible to target advertisements and to accurately track and gauge the effectiveness of the advertising. Each display advertisement can be tracked for success.

Key Takeaways

  • Advertising has four primary objectives: building brand awareness, creating consumer demand, informing consumers of the advertiser’s ability to satisfy that demand, and driving response and sales.
  • These objectives are applicable to online and offline advertising.
  • Online advertising is able to drive instant sales and conversions.
  • Each display advertisements can be tracked for success.


  1. Can you think of an example of when you would need to build brand awareness? Drive response and sales? Create consumer demand? Satisfy consumer demand?
  2. Online banner advertising and outdoor display advertising both use images to try to increase sales. In planning, both need to consider placement so as to be seen by their most likely audience. What are the key differences?