Online advertising is a form of promotion that uses the Internet and World Wide Web to deliver marketing messages to attractcustomers. Examples of online advertising include contextual ads on search engine results pages, banner ads, blogs, RichMedia Ads, Social network advertising, interstitial ads, online classified advertising, advertising networks and e-mail marketing,including e-mail spam. Many of these types of ads are delivered by an Ad server.Competitive advantage over traditional advertisingOne major benefit of online advertising is the immediate publishing of information and content that is not limited by geography or time.To that end, the emerging area of interactive advertising presents fresh challenges for advertisers who have hitherto adopted aninterruptive strategy.Another benefit is the efficiency of advertisers investment. Online advertising allows for the customization of advertisements, includingcontent and posted websites. For example, AdWords, Yahoo! Search Marketing and Google AdSense enable ads to be shown on relevantweb pages or alongside search resultOnline advertisementThe internet has become an ongoing emerging source that tends to expand more and more. The growth of this particular media attractsthe attention of advertisers as a more productive source to bring in consumers.A clear advantage consumers have with online advertisement is the control they have over the item, choosing whether to check it out ornot.Online advertisements may also offer various forms of animation. In its most common use, the term "online advertising" comprises allsorts of banner, e-mail, in-game, and keyword advertising, on platforms such as Facebook, Twitter, or Myspace has received increasedrelevance. Web-87related advertising has a variety of sites to publicize and reach a niche audience to focus its attention to a specificgroup. Research has proven that online advertising has given results and is a growing business revenue.  For the year 2012, Jupiterresearch predicted $34.5 billion in US online advertising spending.Revenue modelsMain article: Compensation methodsThe three most common ways in which online advertising is purchased are CPM, CPC, and CPA.CPM (Cost Per Mille) or CPT (Cost Per Thousand Impressions) is when advertisers pay for exposure of their message to a specificaudience. "Per mille" means per thousand impressions, or loads of an advertisement. However, some impressions may not be counted,such as a reload or internal user action.CPV (Cost Per Visitor) is when advertisers pay for the delivery of a Targeted Visitor to the advertisers website.CPV (Cost Per View) is when advertisers pay for each unique user view of an advertisement or website (usually used with pop-ups, pop-unders and interstitial ads).
CPC (Cost Per Click) or PPC (Pay per click) is when advertisers pay each time a user clicks on their listing and is redirected to theirwebsite. They do not actually pay for the listing, but only when the listing is clicked on. This system allows advertising specialists torefine searches and gain information about their market. Under the Pay per click pricing system, advertisers pay for the right to be listedunder a series of target rich words that direct relevant traffic to their website, and pay only when someone clicks on their listing whichlinks directly to their website. CPC differs from CPV in that each click is paid for regardless of whether the user makes it to the targetsite.CPA (Cost Per Action or Cost Per Acquisition) or PPF (Pay Per Performance) advertising is performance based and is common inthe affiliate marketing sector of the business. In this payment scheme, the publisher takes all the risk of running the ad, and the advertiserpays only for the amount of users who complete a transaction, such as a purchase or sign-up. This model ignores any inefficiency in thesellers web site conversion funnel. The following are common variants of CPA:CPL (Cost Per Lead) advertising is identical to CPA advertising and is based on the user completing a form, registering for a newsletteror some other action that the merchant feels will lead to a sale.CPS (Cost Per Sale), PPS (Pay Per Sale), or CPO (Cost Per Order) advertising is based on each time a sale is made.CPE (Cost Per Engagement) is a form of Cost Per Action pricing first introduced in March 2008. Differing from cost-per-impression orcost-per-click models, a CPE model means advertising impressions are free and advertisers pay only when a user engages with theirspecific ad unit. Engagement is defined as a user interacting with an ad in any number of ways. Cost per conversion Describes the cost of acquiring a customer, typically calculated by dividing the total cost of an ad campaign by thenumber of conversions. The definition of "Conversion" varies depending on the situation: it is sometimes considered to be a lead, a sale,or a purchase.PrivacySee also: HTTP cookie#Privacy and third-party cookiesThe use of online advertising has implications on the privacy and anonymity of users. If an advertising company has placed banners intwo Web sites. Hosting the banner images on its servers and using third-party cookies, the advertising company is able to track thebrowsing of users across these two sites.Third-party cookies can be blocked by most browsers to increase privacy and reduce tracking by advertising and tracking companieswithout negatively affecting the users Web experience. Many advertising operators have an opt-out option to behavioral advertising, witha generic cookie in the browser stopping behavioral advertising.MalwareThere is also a class of advertising methods which are considered unethical and may even be illegal. These include external applicationswhich alter system settings (such as a browsers home page), spawn pop-ups, and insert advertisements into non-affiliated webpages.Such applications are usually labelled 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. These programs are designed to dupe the user, acting effectively as Trojanhorses. These applications are commonly designed so as to be difficult to remove or uninstall. The ever-increasing audience of online
Pop-under: Similar to a Pop-Up except that the window is loaded or sent behind the current window so that the user does not see it untilthey close one or more active windows.Video ad: similar to a banner ad, except that instead of a static or animated image, actual moving video clips are displayed. This is thekind of advertising most prominent in television, and many advertisers will use the same clips for both television and online advertising.Map ad: text or graphics linked from, and appearing in or over, a location on an electronic map such as on Google Maps.Mobile ad: an SMS text or multi-media message sent to a cell phone.Superstitial: An animated adv on a Web page from Enliven Marketing Technologies. It uses video, 3D content or Flash to provide a TV-like advertisement. Used to be known as Unicast Transitional ads as they were originally made by Unicast Communications but thecompany was acquired by Viewpoint Corporation in 2004, which then changed its name to Enliven in 2008. Interstitial ad: a full-page ad that appears before a user reaches their original destination.In addition, ads containing streaming video or streaming audio are becoming very popular with advertisers.E-mail advertisingLegitimate Email advertising or E-mail marketing is often known as "opt-in e-mail advertising" to distinguish it from spam.Display advertisingDisplay advertising appears on web pages in many forms, including web banners. These banners can consist of static or animated images,as well as interactive media that may include audio and video elements. Display advertising on the Internet is widely used for branding.This is why metrics like interaction time are becoming more relevant. This may change in the future as display advertising is becomingmuch more targeted to users, much like how search engine ads can be extremely relevant to users based on what they are searching for.Display advertisers use cookie and browser history to determine demographics and interests of users and target appropriate ads to thosebrowsers. Banner ad standards have changed over the years to larger sizes, in part due to increased resolution of standard monitors andbrowsers, in part to provide advertisers with more impact for their investment. The standards continue to evolve. Banner ads can betargeted to internet users in many different ways in order to reach the advertisers most relevant audience. Behavioral retargeting,demographic targeting, geographic targeting, and site based targeting are all common ways in which advertisers choose to target theirbanner ads.Affiliate marketingMain article: Affiliate marketingAffiliate marketing is a form of online advertising where advertisers place campaigns with a potentially large number of small (and large)publishers, whom are only paid media fees when traffic to the advertiser is garnered, and usually upon a specific measurable campaignresult (a form, a sale, a sign-up, etc.). Today, this is usually accomplished through contracting with an affiliate network.Affiliate marketing was an invention by CDNow.com in 1994 and was excelled by Amazon.com when it launched its Affiliate Program,called Associate Program in 1996. The online retailer used its program to generate low cost brand exposure and provided at the same timesmall websites a way to earn some supplemental income.
Behavioral targetingIn addition to contextual targeting, online advertising can be targeted based on a users online behavior. This practice is knownas behavioral targeting. For example, if a user is known to have recently visited a number of automotive shopping / comparison sitesbased on clickstream analysis enabled by cookies stored on the users computer, that user can then be served auto-related ads when theyvisit other, non-automotive sites.In the United States the Federal Trade Commission has been involved in the oversight of behavioral targeting for some time. In 2011 theFTC proposed a "Do Not Track" mechanism to allow Internet users to opt-out of behavioral targeting.Semantic advertisingSemantic advertising applies semantic analysis techniques to web pages. The process is meant to accurately interpret and classify themeaning and/or main subject of the page and then populate it with targeted advertising spots. By closely linking content to advertising, itis assumed that the viewer will be more likely to show an interest (i.e., through engagement) in the advertised product or service.Ad server market structureGiven below is a list of top Ad server vendors in 2008 with figures in millions of viewers published in an Attributor survey. Since 2008Google controls estimated 69% of the online advertising market. Vendor Ad viewers (millions)Google 1,118DoubleClick (Google) 1,079Yahoo! 362MSN (Microsoft) 309AOL 156Adbrite 73Total 3,097It should be noted that Google acquired DoubleClick in 2007 for a consideration of $3.1 billion. The above survey was based on asample of 68 million domains .