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Online advertising
Online Advertising
Online advertising
Overview of the market
A significant number of firms, from small businesses to multinational
corporations, incorporate online advertising into their marketing strategy. This
is even true of firms which conduct their business through more traditional
brick and mortar channels. In response to this demand, a number of firms
specialize in facilitating online marketing. Therefore, online advertisements
typically involve at least two separate firms: the advertiser or agency which
purchases or sponsors the advertisement and the publisher or network which
distributes the ad for display. Additional parties may also be included, such as
an ad serving technology provider, a third party sales network, or other
combinations.
In capitalizing on the increasing importance of the Internet as a marketing
medium, the online advertising industry has developed specialized technical
systems to manage the ways ads are distributed and viewership totaled. The
Internet Advertising Bureau (IAB) has established guidelines for the
counting methodology, size requirements, and other aspects of the business.
Because of the close relation between technical innovation and online
advertising, many firms specialize in both. For example, most search engines
couple their search service with an advertising program, exploiting the benefits
of keyword-based search technology by including ads in search results. Many
technology firms specialize in
ad serving, the systems used to select the ads to show, optimize results,
and generate reports.
Payment conventions
Because of the ability to track results of online advertising at a more
granular level than what is available through traditional advertising, varying
ways have developed for the advertisers and publishers to do business. The three
most common ways in which online advertising is purchased are
CPA,
CPC,
and
CPM.
CPA (Cost Per Action) advertising is performance based and is common in the
affiliate marketing sector of the business. In this payment scheme, the
publisher takes all the risk of running the ad, and the advertiser only pays for
the media on the basis of the number of users who complete a transaction, such
as a purchase or sign-up.
CPC (Cost Per Click) advertising is also performance based and is common in
search marketing, where it is often known as
Pay
per click (PPC). In this scheme, an advertisement may be displayed (and
assumedly viewed) many times, but the advertiser only pays based on the number
of user clicks. This system provides an incentive for publishers to target ads
correctly (often by keyword), as the payment depends upon the ad not only being
seen, but the viewer responding and following the hyperlink.
CPM (Cost per Thousand) advertising is the most common basis in the business
and is used for most display advertising and rich media.
This scheme most closely resembles offline advertising, wherein the advertiser
is paying for exposure of their message to a specific audience. CPM costs are
priced per thousand, so that a $1 CPM, means that the advertiser pays $1 for
every thousand impressions.
Rich Media advertising
The display advertising portion of online advertising is increasingly
dominated by rich media, generally using
Macromedia Flash. Rich media advertising techniques make overt use of color,
imagery, page layout, and other elements in order to attract the reader's
attention. Some users might consider these ads as intrusive or obnoxious,
because they can distract from the desired content of a webpage. Some examples
of common rich media formats and the terms of art used within the industry to describe them:
-
Interstitial or Expanding ad: The display of a page of ads before the requested content.
-
Floating ad: An ad which moves across the user's screen or floats above
the content.
-
Expanding ad: An ad which changes size and which may alter the contents
of the webpage.
-
Polite ad or Polite download: A method by which a large ad will be downloaded in
smaller pieces to minimize the disruption of the content being viewed
-
Wallpaper ad: An ad which changes the background of the page being
viewed.
In addition, ads containing
streaming video or streaming audio are becoming very popular with advertisers.
Email advertising
Legitimate Email advertising is often known as
opt-in email to distinguish it from
spam.
Affiliate marketing
Affiliate marketing is a form of advertising where the advertiser allows a
potentially large number of small publishers to pick specific creative elements
or offers to market in exchange for payment should such marketing create sales
or other revenue. This is usually accomplished though a self-service online
system, such as those offered by third parties
Performics, BeFree, CommissionJunction, or Linkshare. Affiliate marketing was an
early innovation of online retailer Amazon, which
has used its program to generate enormous volumes of low cost brand exposure.
Contextual advertising
Many
advertising networks display text-only ads that correspond to the keywords
of an Internet search or to the content of the page on which the ad is shown.
These ads are believed to have a greater chance of attracting a user, because
they tend to share a similar context as the user's search query. For example, a
search query for "flowers" might return an advertisement for a florist's
website.
Another newer technique is embedding keyword
hyperlinks
in a webpage which are sponsored by an advertiser. When a user follows the link,
they are sent to a sponsor's website.
Ads and malware
There is also class of advertising methods which may be considered unethical
and perhaps even illegal. These include external applications which alter system
settings (such as a browser's home page), spawn pop-ups, and insert
advertisements into non-affiliated webpages. Such applications are usually
labeled as
spyware or
adware. They may mask their questionable activities by performing a simple
service, such as displaying the weather or providing a search bar. Some programs
are effectively
trojans. These applications are commonly designed so as to be difficult to
remove or uninstall. The ever-increasing audience of online users, many of which
are not computer-savvy, frequently lack the knowledge and technical ability to
protect themselves from these programs.
See also
- Industry calculations:
Click Through Rate(CTR),
Cost Per Action(CPA),
effective Cost Per Action(eCPA),
Cost Per Click(CPC),
Cost Per Impression(CPI),
Cost Per Mille(CPM),
effective Cost Per Mille(eCPM)
- Web advertising:
Web
banner,
Ad
filtering,
central ad server,
pay per click,
Pop-up ad,
click
fraud
- E-Mail advertising:
e-mail spam,
opt-in e-mail advertising,
Spamming
External Links
Home | Up | Online advertising | Advertising agency | Ad filtering | Ad serving | Advertising network | Classified ad | Direct navigation | Pixel script | Pop-up ad | Web banner | Flyposting
Online Advertising, made by MultiMedia | Free content and software
This guide is licensed under the GNU
Free Documentation License. It uses material from the Wikipedia.
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