But it is now - just when cyberspace seems to have gone quiet - that online advertising is finally coming of age. Not a case of high-tech domination as previous hype would have had us believe, but one of acceptance.
The effectiveness of online advertising as a branding tool - and its place in a broader media mix - is increasingly being recognised. And while there are few hard figures to prove it, industry heads say this recognition is leading a growing pool of advertisers to put their hands in their pockets and spend online.
"I think we've seen an increase in internet advertising, says Hong Kong-based Peter Steyn of Nielsen//NetRatings. "Maybe not in banner advertising but different ways of using it, such as email marketing and so forth."
Advertisers are not simply building corporate websites but 'microsites' within other sites. And they are experimenting with more dynamic banner ads, as well as increasing their use of online databases and online clubs to capture consumers' attention and information.
"One of the problems at the beginning of the internet was people hoped there would be huge click rates and when there weren't, a lot of people lost confidence in online advertising. They came to the conclusion that it wasn't effective, Steyn says.
He says that if you look beyond hits and clicks, however, there is evidence that online campaigns do work. Job-search company monster.com, for instance, had low click rates for its recent banners on MSN, but at the same time saw a surge in traffic to its own website. Steyn said it was logical to conclude that consumers were seeing the ad, remembering the name and, later, when they needed a job service, they remembered the ad and went straight to the site. "Even though click rates were low, the impression was strong, he says.
In the past, however, it may have been the case that much of the money thrown at online advertising was wasted. "Before, banner ads were like billboards on a highway - they interrupted your journey and took you away from what you were doing, says Ken Mandel, CEO and regional director of CCG.XM in Singapore.
"And the way it was sold meant you would buy a basket of sites, so you weren't actually pinpointing sites that would cater to your target market."
Now, advancing technology is allowing for greater creativity, and static banners are giving way to flashing, moving messages. At the same time, major sites are being more flexible in what advertisers and agencies can buy.
"Before, they wouldn't allow you to slow down the site. Now you can do rich formats and do something more interesting, like have people register for a newsletter, or play a game that raises brand awareness, then go back to what they were doing, says Mandel.
Karen Jim, general manager of Grey Interactive Hong Kong, says tough economic times in Asia have forced advertisers to take a more considered approach in their use of all media, including online.
"In the past, people thought 'this is a new media, there's a boom on the internet' so they spent quite a lot on online advertising regardless of whether it was effective or not. Now, I think they're very cautious about every single dollar they spend."
Jim says that while the purse strings are more difficult to prise open, advertisers are still willing to spend online because it is cost-effective and easy to monitor. Floating icons and other, more creative takes on the traditional banner, are breathing new life into the medium, and email marketing allows for a more personal and less intrusive communication with customers, she says. "Also, you can very quickly change your creative message; you do it today, tomorrow you have a new ad."
"The drawback (compared with a medium like mobile SMS) is you need to get hold of a computer first, whether that's at home or in Starbucks or whatever, but a lot of people are going online, regardless of age or profession, and the advantage (of online advertising) is the visual impact and the interaction, Jim added.
Nielsen figures show staggering internet sign-up rates across the region.
In Australia, where just over half of all homes now have internet access, the penetration rate has risen by almost a quarter in the past year. Japan has just passed 40 per cent penetration, Taiwan is at 49 per cent, and South Korea, Singapore and Hong Kong all have rates between 50 and 60 per cent.
In China, meanwhile, internet access trails the rest of Asia by a long way but it is growing astronomically. Between the first and second quarters of this year, the number of homes online went from 5.5 per cent to 6.6 per cent - more than 20 per cent growth in just three months.
The potential of this strengthening link with consumers is not being lost on advertisers. At adidas, new media manager Asia-Pacific, Carmen Chen, says spending online has gone up this year due to sponsorship of the World Cup and its partnership with Yahoo. Online strategy varies from campaign to campaign, but Chen is wary of banners because "they seem to be something (computer users) want to get rid of".
"We tend to use email marketing because people can find other types of online activities quite annoying, depending on what they're doing. We have an online community (where consumers can earn points and redeem them for products) and that's very important. You really have got to give them a reason to come back, she says.
Curiously, Steyn says the annoyance factor is not necessarily a bad thing: "Some of the most annoying ads are the ones people remember most, and even if they recall the experience as a bad one, they still buy."
Another adidas online project is a microsite within Channel V's site to promote the new ClimaCool range. The project is part of a wider partnership with the music channel in which viewers are taught hip-hop dance moves by a teacher dressed in head-to-toe adidas on a specially created segment in a popular show, which adidas sponsors. "I would say the wastage is comparatively less, says Chen of online advertising. "If you have an outdoor or even TV ad, you can't really track how many people have actually seen it or taken notice of it, but with online you can."
Jeans legend Levi's also sees a strong future online. VRM Raju, director for strategic brand planning Asia-Pacific, says its spend next year will be about 30-40 per cent higher than this year. At the moment, the Levi's web sites are aimed at giving customers contact with the brand; in future, Raju says the focus will be on building up database capabilities and CRM.
"In 2003, we would see some more interactivity and a platform for something more of an experience of the brand through the website, with music for example, he says.
"We definitely believe this is an important and evolving medium. It's all about using it as an additional vehicle and the advantage is you can do things with this that you can't do with other media. It's about building intimacy and a one-to-one dialogue."
Yet, even as advertisers renew their passion for the medium, the interactive agency cull continues unabated.
Last month alone saw the closure of Mezzo Marketing, Modem Media, Spike and DoubleClick's media division, while in Singapore, Organic and Icon have closed their doors. This is despite International Data Corporation figures predicting 46 per cent a year growth in online advertising in Asia-Pacific for the next three years.
Mandel says these closures do not accurately reflect the state of the industry; some of the closures were the result of factors that had little to do with sales success.
"I do think there's been a massive shake-out ... but the problem now is when clients are finally seeing the benefits of online, they get this impression that everyone's closing and it's bad for business. We're busier than ever, he says.
Grey's Jim says broader economic factors are to blame for much of the turmoil. "The other thing is that interactive is part of the whole marketing and communications mix, and if you're a standalone interactive agency, it's quite difficult. A lot of people are only just realising that."
And of course, not everyone is convinced that online advertising can add value to their brands. Dougal McGeorge, marketing manager for Heineken Hong Kong, has no plans to extend investment beyond the company's current information-based site. "As an FMCG-type product with a relatively low purchase price, the web is not a natural medium for mass advertising, he says. "About two years ago we had an affiliation with hongkong.com, and the data on hits and clicks on that was significantly disappointing, but that's not a feature of hongkong.com - it just wasn't right for us."
Mandel says online advertising is best suited to "high consideration" products, for which research and price comparison are important, for instance with mortgages and holidays. "But internet adoption is only going up so as people sign on and use the internet, it's becoming a more homogeneous audience, whereas perhaps three years ago it was just the early users."
Nielsen//NetRatings' Steyn says advertisers are only now beginning to realise that choosing the right sites to advertise on is vital; bigger is not better, and ads on low-traffic niche sites are often more effective than those on high-traffic general portals.
They must also realise that the traditional 90-10 split in spending between media and production needs to be adjusted; a boring banner won't make much of an impression no matter how many sites it is splattered across, and it may actually contribute to consumer fatigue of online advertising.
The bottom line is, however, that as the spotlight on the dotcom world has faded, the medium is slowly gaining respect from advertisers and credibility among consumers.
Online now stands alongside its long-established media siblings and will rise - or fall - on its own merits rather than any misguided market frenzy.
"In some countries, the online demographics are the same as offline; advertisers are realising that online is just another touch point," Mandel says. "It's becoming more mainstream."
