Ethical Considerations and Cost Analysis of Internet Advertising: A Case Study of Helios Botanicals' Marketing Strategy
A case study examining the ethical and cost aspects of internet advertising for Helios Botanicals.
Sophia Johnson
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Ethical Considerations and Cost Analysis of Internet Advertising: A Case
Study of Helios Botanicals' Marketing Strategy
2‐
23
Calculate expected costs (LO 1) Helios Botanicals develops hybrid tea roses. A relative newcomer to
the field, Helios is looking for innovative ways to advertise its products to potential customers. Rose
Mayfield, sales manager and avid online shopper, wonders about advertising the company's roses on
various gardening websites. She has contacted Kimland Media, Inc., an advertising firm specializing in
Internet advertising campaigns, to explore some options.
After meeting with Rose, Sami Landon, regional sales coordinator, has suggested that Helios use a
targeted marketing strategy by placing banner ads on a few gardening websites. Helios would pay for the
service based primarily on the number of ad impressions (the number of times the ads are shown). Using
past campaigns as a guide, Sami has prepared the following quarterly estimate for Helios.
Banner ad development (5 banners per quarter) $5,000
Banner ad placement $0.80 per thousand impressions
Estimated ad impressions 2,000,000
Banner ad click‐throughs $0.02 per click‐through
From past experience, Kimland Media estimates that 10% of all viewers will “click through” the banner
ad to Helios's website. Of those viewers who click through, Kimland estimates that 5% will actually
make a purchase.
Required
a. What is the expected total cost per quarter of Helios's Internet advertising campaign?
Study of Helios Botanicals' Marketing Strategy
2‐
23
Calculate expected costs (LO 1) Helios Botanicals develops hybrid tea roses. A relative newcomer to
the field, Helios is looking for innovative ways to advertise its products to potential customers. Rose
Mayfield, sales manager and avid online shopper, wonders about advertising the company's roses on
various gardening websites. She has contacted Kimland Media, Inc., an advertising firm specializing in
Internet advertising campaigns, to explore some options.
After meeting with Rose, Sami Landon, regional sales coordinator, has suggested that Helios use a
targeted marketing strategy by placing banner ads on a few gardening websites. Helios would pay for the
service based primarily on the number of ad impressions (the number of times the ads are shown). Using
past campaigns as a guide, Sami has prepared the following quarterly estimate for Helios.
Banner ad development (5 banners per quarter) $5,000
Banner ad placement $0.80 per thousand impressions
Estimated ad impressions 2,000,000
Banner ad click‐throughs $0.02 per click‐through
From past experience, Kimland Media estimates that 10% of all viewers will “click through” the banner
ad to Helios's website. Of those viewers who click through, Kimland estimates that 5% will actually
make a purchase.
Required
a. What is the expected total cost per quarter of Helios's Internet advertising campaign?
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