An exploratory study of search advertising in China

This paper examines the effects of serial position, price promotion, user experience and brand familiarity on search advertising in China. Past research on traditional media has hypothesized that TV ads in prime time and print ads in cover pages received more audience's attention than other ads placed in nonprime time spots on TV or other ads placed in inside pages in print media. Recent study finds the "banner blindness" phenomenon in interactive advertising due to user expertness. Past research also indicates that price promotion and brand familiarity have positive effects on consumer behavior. Will these theories also apply to the new media search engine? This study investigates whether higher ranked ads will result in higher click-through rates, whether "banner blindness" phenomenon also exists in search advertising and whether price promotion and brand familiarity lead to higher level of user attention and thus higher click-through rate. First, this paper analyzes advertisements in varied positions within the same context to better understand the effect of advertisement position ranking on consumer behavior, its role in advertising effectiveness, and the implications for interactive advertising and marketing communication. Second, it compares advertisement with price promotion message in ad copy with advertisement without price promotion message at the same ranking position within the same context. Finally, this study explores the relationship between user experience, brand familiarity and click-through rate. Major findings of this study include the following: first, primacy effect, price promotion and brand familiarity can lead to higher level of user attention to search advertisements and thus result in higher click-through rates. Second, user experience has a negative effect on search advertising effectiveness. The more experienced the users are, the less likely they click on search advertisements. Lastly, recency effect is not obtained in search advertising in this study. This study helps us better understand the effects of ad serial position, price promotion, user experience & brand familiarity on search advertising. It adds to our knowledge in search advertising and provides theoretical & practical implications for future research.