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Web Advertising

You have probably noticed that across the Web, two different things are happening right now:
  1. More and more sites are asking you to pay a fee to subscribe to all or part of the Web site.
  2. Advertising is becoming more and more "in your face." There are now pop-up ads, ads that play music and sound tracks, ads that swim across the screen, and so on.

The second trend is true of nearly all commercial Web sites. There are many new forms of Web advertising, and they are more and more obvious. Many Web users have questions about all of these new ad types. For example:

  • Why do Web sites have so many ads now?
  • Why do Web sites allow pop-up ads that open new windows? (Many people hate closing them all.)
  • Why do Web sites allow these floating ads that cover the content so I cannot read it?
  • How can I make all these ads go away?

In this article, we will look at all the different forms of Web advertising in use today, as well as the economics that are driving them, so that you can have a much better understanding of how Web advertising works. Whether you are a casual surfer or someone running your own Web site, you will find this article to be a real eye-opener.

Banner Ads

In the beginning, "advertising" on the Internet meant "banner ads" -- the 728x90-pixel ads you see at the top of almost all Web pages today (including this one). In 1998 or so, banner advertising was a lucrative business. Popular sites like Yahoo could charge $30, $50, even $100 per thousand impressions to run banner ads on their pages. These advertising rates provided fuel for much of the venture capital boom on the Web. The idea was that sites could start up and increase their page impressions to make easy money from banner ads. If a site could generate 100 million page impressions per month, it could make $3 million per month with banner ad rates at $30 per thousand impressions.

Where did numbers like $30 or $50 per thousand impressions come from? That's what magazines typically charge for full-page color ads. The Internet took the same payment model and applied it to banner ads.