1.1 Introduction
Internet advertising refers to the use of the internet to deliver promotional marketing messages to consumers. It encompasses various forms, including display ads, search engine marketing, social media ads, email marketing, and video ads (Chaffey & Ellis-Chadwick, 2019). The advent of the internet has revolutionized the way businesses interact with consumers, fundamentally altering traditional advertising paradigms. Internet advertising, encompassing a range of formats from search engine ads to social media promotions, has become an integral tool for influencing consumer behavior and purchase decisions. Unlike traditional media, internet advertising offers interactive, personalized, and data-driven approaches to reach target audiences.
The consumer purchase decision is the process by which individuals identify their needs, gather information, evaluate alternatives, and make the purchase decision. This process is influenced by various factors including advertising, personal preferences, and social influences (Kotler & Armstrong, 2018). Recent studies indicate that internet advertising significantly affects consumer purchase decisions by enhancing brand awareness, and fostering purchase intention through targeted and engaging content (Smith, 2022). The precision of internet advertising allows businesses to tailor their messages to specific demographics, increasing the likelihood of conversion. Additionally, the interactive nature of digital ads facilitates a two-way communication channel between consumers and brands, fostering deeper engagement and trust.
As a prelude to other parts of this study, this chapter will discuss the background upon which this study was initiated, the statement of problems that led to this study, the Aim and Objectives of the study. Others are Significance of the study, Scope of work, Research hypothesis and questions, Limitation of the study and Definition of terms.
1.2 Background of Study
The history of internet advertising and its impact on consumer purchase decisions traces back to the early days of the World Wide Web. in the mid-1990s, the internet began to gain widespread public access, and businesses quickly recognized its potential as a marketing tool. The first known internet advertisement, a simple banner ad for AT&T, appeared on the website HotWired in 1994. This marked the beginning of a new era in advertising, where digital platforms offered unprecedented reach and measurability (Kaye & Medoff, 2001). in the late 1990s and early 2000s, search engine advertising emerged as a powerful tool with the introduction of Google's AdWords in 2000. This pay-per-click (PPC) model allowed advertisers to target consumers based on search queries, making advertising more relevant and cost-effective. The ability to measure clicks and conversions provided businesses with clear insights into the return on investment (ROI) of their advertising efforts (Jansen & Mullen, 2008).
The advent of social media in the mid-2000s further transformed internet advertising. Platforms like Facebook, launched in 2004, and Twitter, launched in 2006, created new opportunities for targeted advertising based on user interests, behaviors, and demographics. Social media advertising leveraged user-generated content and peer influence, enhancing consumer engagement and trust (Kaplan & Haenlein, 2010). Mobile advertising gained traction with the proliferation of smartphones in the late 2000s and early 2010s. The development of mobile apps and the increasing use of mobile devices for browsing and shopping led to new advertising formats, such as in-app ads and location-based targeting. This shift further personalized advertising experiences and influenced purchase decisions by reaching consumers in real-time and in specific contexts (Ghose & Han, 2014).
Programmatic advertising, which uses automated systems and algorithms to buy and place ads, became prominent in the 2010s. This technology allowed for more efficient and precise targeting, optimizing ad placements based on consumer data and behavior. Programmatic advertising's ability to deliver personalized and timely ads has significantly impacted consumer purchase decisions by making advertising more relevant and engaging (Lambrecht & Tucker, 2013). Today, internet advertising continues to evolve with advancements in artificial intelligence (AI) and machine learning, which enhance the ability to analyze consumer data and predict purchasing behavior. The ongoing development of new advertising formats and technologies ensures that internet advertising remains a dynamic and influential force in shaping consumer purchase decisions.
The digital age has ushered in a new era of advertising, where the internet plays a pivotal role in shaping consumer behavior. Traditional advertising mediums such as television, radio, and print have seen a decline in favor of more dynamic and interactive online platforms. The shift towards internet advertising is driven by its ability to reach a global audience, provide real-time data analytics, and offer personalized user experiences. According to a report by eMarketer (2021), digital ad spending worldwide reached $455 billion in 2021, reflecting the growing importance of online advertising in marketing strategies.
Internet advertising encompasses various formats, including display ads, search engine marketing, social media advertising, email marketing, and influencer partnerships. Each of these formats leverages different aspects of the internet to capture consumer attention and drive purchasing behavior. For instance, social media platforms like Facebook and Instagram use sophisticated algorithms to deliver targeted ads based on user interests and behaviors, thereby increasing the relevance and impact of advertising messages (Chaffey & Ellis-Chadwick, 2019).
The impact of internet advertising on consumer purchase decisions is multifaceted. It involves the interplay of factors such as brand awareness, emotional appeal, and peer influence. Research indicates that consumers are more likely to trust and engage with brands that have a strong online presence and positive digital interactions (Kumar & Gupta, 2020). Moreover, the immediacy and accessibility of online information empower consumers to make informed purchasing decisions, often leading to higher conversion rates compared to traditional advertising methods. Therefore, in Nigeria where the research was carried out, the activities that was conducted is to know the impact of internet advertising on consumer's purchase decision.
1.3 Statement of Problems
Investigation revealed that many businesses struggle to integrate internet advertising with traditional marketing strategies effectively. This lack of integration can result in inconsistent messaging and missed opportunities to reinforce brand identity across different channels. Identifying strategies to create cohesive and synergistic advertising campaigns is vital for maximizing the overall impact on consumer purchase decisions (Smith, 2022).
Additionally, the increasing use of ad blockers reflects a growing resistance to internet advertising. Coupled with evolving consumer behavior, such as the preference for ad-free content platforms, this trend poses a significant threat to the reach and effectiveness of digital ads. Understanding the motivations behind ad blocker use and adapting advertising strategies to these changes is critical for maintaining engagement (Redondo & Aznar, 2018).
Furthermore, despite advancements in analytics, accurately measuring the impact of internet advertising on consumer purchase decisions remains difficult. Metrics such as click-through rates (CTR) and conversion rates provide some insights, but they do not capture the full spectrum of consumer behavior and the long-term effects of advertising. Developing comprehensive measurement frameworks is essential for evaluating the true impact of digital ads (Pavlou & Stewart, 2000). Hence, it is against this backdrop that this study aims to examine the impact of internet advertising on consumer's purchase decision.
1.4 Aim and Objectives of Study
The aim of the study is to investigate the impact of internet advertising on consumer purchase decisions. In achieving this aim, the following specific objectives were laid out as follows:
- To compare the effectiveness of various digital advertising strategies, such as targeted ads, and influencer marketing, in driving consumer purchase decisions;
- To identify key factors that contributes to sustained consumer engagement and loyalty through digital marketing;
- To examine how consumers perceive different types of online ads and the factors that influence these perceptions;
- To identify the elements of internet advertising that contribute to positive or negative consumer attitudes; and
- To assess the long-term impact of internet advertising on brand loyalty and customer retention compared to traditional advertising methods.
1.5 Research Questions
The study came up with research questions so as to be able to ascertain the above stated objectives. The specific research questions for the study are stated below as follows:
- How effective is the various digital advertising strategies, such as targeted ads, and influencer marketing, in driving consumer purchase decisions?
- How does a consumer perceive different types of online ads and the factors that influence these perceptions?
- What are the key factors that contribute to sustained consumer engagement and loyalty through digital marketing?
- What are the elements of internet advertising that contribute to positive or negative consumer attitudes?
- What are the long-term impact of internet advertising on brand loyalty and customer retention compared to traditional advertising methods?
1.6 Research Hypothesis
In order to pursue the objective of this study, the following generalized statements have been designed to guide and aids in obtaining the result for the experiment to be conducted. For this work, the null hypothesis will be represented with H0 while the alternative hypothesis will be represented with hypothesis H1.
- H01: Consumers does not have favorable perception of personalized internet advertising compared to non-personalized ads.
- H02: Internet advertising has a significant positive impact on long-term brand loyalty compared to traditional advertising methods.
- H03: Integration of internet advertising with traditional marketing strategies results in more cohesive and effective advertising campaigns.
1.7 Significance of Study
The findings of this research will provide a comprehensive analysis of how internet advertising influences consumer behavior and purchase decisions. By identifying the key factors that drive consumer engagement with online ads, marketers can tailor their strategies to better meet consumer preferences and expectations (Kotler et al., 2018).
Additionally, businesses will benefit from the findings by optimizing their internet advertising strategies to achieve higher ROI. Understanding which types of ads and targeting methods are most effective can lead to more efficient allocation of advertising budgets and improved marketing performance (Chaffey & Ellis-Chadwick, 2019).
Furthermore, this research contributes to the academic literature on digital marketing and consumer behavior. It provides a theoretical framework and empirical evidence that can inform future studies in the field, fostering a deeper understanding of the dynamics of internet advertising (Pavlou & Stewart, 2000).
1.8 Scope of Study
The scope of the research is focused on the Impact of Internet Advertising on Consumer's Purchase Decision using AJ fast food in Delta State as a case study.
1.9 Limitations of the Study
During the course of this study, many things militated against its completion, some of which are:
- Time Constraint: The time frame given to accomplish this project was very short due to school academic calendar and it was carried out under pressure which made the researcher not to implement some necessary features.
- Establishment Policies: Establishment policies posed a serious limitation as most staffs are not ready to release information needed for this project work. There were lots of information needed from the staffs of this establishment to enhance the study which took them time to release or they did not release at all for security purposes, hence the scope was reduced.
- Financial Constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
1.10 Definition of Terms
Advertising:
Advertising is any paid form of non-personal presentation and promotion of ideas, goods and services through mass media such as newspapers, magazines, television or radio by an identified sponsor.
Internet Advertising (Online Advertising):
Internet advertising refers to the use of the internet to deliver promotional marketing messages to consumers. It encompasses various forms, including display ads, search engine marketing, email marketing, and video ads (Chaffey & Ellis-Chadwick, 2019).
Consumer Purchase Decision:
The consumer purchase decision is the process by which individuals identify their needs, gather information, evaluate alternatives, and make the purchase decision. This process is influenced by various factors including advertising, personal preferences, and social influences (Kotler & Armstrong, 2018).
Personalized Advertising:
It involves tailoring advertisements to individual consumers based on their preferences, behaviors, and demographic information. This strategy aims to increase relevance and engagement by delivering customized ad content (Tucker, 2014).
Targeted Advertising:
Targeted advertising is the practice of directing advertisements to specific segments of the population based on characteristics such as age, gender, interests, and online behavior. This method aims to increase the effectiveness of ads by reaching the most relevant audience (Lambrecht & Tucker, 2013).
Ad Blockers:
Ad blockers are software tools or browser extensions that prevent advertisements from being displayed on web pages. These tools are used by consumers to avoid unwanted ads, which can impact the reach and effectiveness of online advertising (Redondo & Aznar, 2018).
Brand Loyalty:
Brand loyalty refers to the tendency of consumers to continue purchasing the same brand's products or services over time due to positive experiences and satisfaction. It is a key indicator of long-term business success (Oliver, 1999).
Customer Retention:
Customer retention is the ability of a company to retain its customers over a period. High customer retention indicates satisfaction and loyalty, which are essential for sustained business growth (Reichheld & Sasser, 1990).
Return on Investment (ROI):
It is a measure of the profitability of an investment. in the context of advertising, ROI evaluates the financial returns generated from advertising expenditures, helping businesses assess the effectiveness of their marketing strategies (Rust et al., 2004).
Consumer Engagement:
It refers to the interaction between consumers and brands through various touchpoints, including advertisements. High levels of engagement typically lead to greater brand awareness, loyalty, and purchase intentions (Hollebeek et al., 2014).
