Product Code Database
Online advertising, also known as online marketing, Internet advertising, digital advertising or web advertising, is a form of marketing and advertising that uses the Internet to promote products and services to audiences and platform users. (2025). 9783030040918, Springer International Publishing. ISBN 9783030040918 Online advertising includes email marketing, search engine marketing (SEM), social media marketing, many types of display advertising (including web banner advertising), and mobile advertising. Advertisements are increasingly being delivered via automated software systems operating across multiple websites, media services and platforms, known as programmatic advertising.
Like other advertising media, online advertising frequently involves a publisher, who integrates advertisements into its online content, and an advertiser, who provides the advertisements to be displayed on the publisher's content. Other potential participants include advertising agencies that help generate and place the ad copy, an ad server which technologically delivers the ad and tracks statistics, and advertising affiliates who do independent promotional work for the advertiser.
In 2016, Internet advertising revenues in the United States surpassed those of cable television and broadcast television. In 2017, Internet advertising Revenue in the United States totaled $83.0 billion, a 14% increase over the $72.50 billion in revenues in 2016. And research estimates for 2019's online advertising spend put it at $125.2 billion in the United States, some $54.8 billion higher than the spend on television ($70.4 billion).
Many common online advertising practices are controversial and, as a result, have become increasingly subject to regulation. Many internet users also find online advertising disruptive and have increasingly turned to ad blocking for a variety of reasons. Online also may not adequately replace other publishers' revenue streams. Declining ad revenue has led some publishers to place their content behind .
The first known large-scale non-commercial spam message was sent on 18 January 1994 by an Andrews University system administrator, by a religious message to all USENET newsgroups. In January 1994 Mark Eberra started the first email marketing company for opt-in Mailing list under the domain Insideconnect.com. He also started the Direct Email Marketing Association to help stop unwanted email and prevent spam.
Four months later, Laurence Canter and Martha Siegel, partners in a law firm, broadly promoted their legal services in a USENET posting titled "Green Card Lottery – Final One?" Canter and Siegel's Green Card USENET spam raised the profile of online advertising, stimulating widespread interest in advertising via both Usenet and traditional email. More recently, spam has evolved into a more industrial operation, where spammers use armies of virus-infected computers () to send spam remotely.
According to Ad Age Datacenter analysis, in 2017 over half of agency revenue came from digital work.
The March 2021 eBay advertisement for the first Asian Giant Hornet ( Vespa mandarinia) nest in the US was controversial. The owner of the first nest discovered in the United States in Blaine, Washington demanded its return instead of allowing scientific investigation, and proceeded to sell it. A nearby beekeeper bought it to gift it back to the state entomology team which had exterminated it, for study.
Banner ads can use rich media to incorporate video, audio, animations, buttons, forms, or other interactive elements using , HTML5, Adobe Flash, and other programs. Frame ads were the first form of web banners. The colloquial usage of "banner ads" often refers to traditional frame ads. Website publishers incorporate frame ads by setting aside a particular space on the web page. The Interactive Advertising Bureau's Ad Unit Guidelines propose standardized pixel dimensions for ad units.
Pop-ups/pop-unders: A pop-up ad is displayed in a new web browser window that opens above a website visitor's initial browser window. A pop-under ad opens a new browser window under a website visitor's initial browser window. Pop-under ads and similar technologies are now advised against by online authorities such as Google, who state that they "do not condone this practice".
Floating ad: A floating ad, or overlay ad, is a type of rich media advertisement that appears superimposed over the requested website's content. Floating ads may disappear or become less obtrusive after a pre-set time period.
Expanding ad: An expanding ad is a rich media frame ad that changes dimensions upon a predefined condition, such as a preset amount of time a visitor spends on a webpage, the user's click on the ad, or the user's mouse movement over the ad. Expanding ads enable the inclusion of more content within a limited initial ad space.
Trick banners: A trick banner is a banner ad where the ad copy imitates some screen elements users commonly encounter, such as an operating system message or popular application message, to induce ad clicks. Trick banners typically do not mention the advertiser in the initial ad, and thus they are a form of bait-and-switch. Trick banners commonly attract a higher-than-average click-through rate, but tricked users may resent the advertiser for deceiving them.
Some examples are: Facebook's "Sponsored Stories", LinkedIn's "Sponsored Updates", and Twitter's "Promoted Tweets".
This display ads format falls into its own category because unlike banner ads which are quite distinguishable, News Feed Ads' format blends well into non-paid news updates. This format of online advertisement yields much higher click-through rates than traditional display ads.
As advertisers collect data across multiple external websites about a user's online activity, they can create a detailed profile of the user's interests to deliver even more targeted advertising. This aggregation of data is called behavioral targeting. Advertisers can also target their audience by using contextual to deliver display ads related to the content of the web page where the ads appear. Retargeting, behavioral targeting, and contextual advertising all are designed to increase an advertiser's return on investment, or ROI, over untargeted ads.
Advertisers may also deliver ads based on a user's suspected geography through geotargeting. A user's IP address communicates some geographic information (at minimum, the user's country or general region). The geographic information from an IP can be supplemented and refined with other proxies or information to narrow the range of possible locations. For example, with mobile devices, advertisers can sometimes use a phone's GPS receiver or the location of nearby mobile towers. Cookies and other persistent data on a user's machine may help narrow down a user's location even further.
This involves many parties interacting automatically in real time. In response to a request from the user's browser, the publisher content server sends the web page content to the user's browser over the Internet. The page does not yet contain ads, but contains links which cause the user's browser to connect to the publisher ad server to request that the spaces left for ads be filled in with ads. Information identifying the user, such as cookies and the page being viewed, is transmitted to the publisher ad server.
The publisher ad server then communicates with a supply-side platform server. The publisher is offering ad space for sale, so they are considered the supplier. The supply side platform also receives the user's identifying information, which it sends to a data management platform. At the data management platform, the user's identifying information is used to look up demographic information, previous purchases, and other information of interest to advertisers. The process is sometimes described as a 'waterfall'.
Broadly speaking, there are three types of data obtained through such a data management platform:
This customer information is combined and returned to the supply side platform, which can now package up the offer of ad space along with information about the user who will view it. The supply side platform sends that offer to an ad exchange.
The ad exchange puts the offer out for bid to demand-side platforms. Demand side platforms act on behalf of ad agencies, who sell ads which advertise brands. Demand side platforms thus have ads ready to display, and are searching for users to view them. Bidders get the information about the user ready to view the ad, and decide, based on that information, how much to offer to buy the ad space. According to the Internet Advertising Bureau, a demand side platform has 10 milliseconds to respond to an offer. The ad exchange picks the winning bid and informs both parties.
The ad exchange then passes the link to the ad back through the supply side platform and the publisher's ad server to the user's browser, which then requests the ad content from the agency's ad server. The ad agency can thus confirm that the ad was delivered to the browser.
This is simplified, according to the IAB. Exchanges may try to unload unsold ("remnant") space at low prices through other exchanges. Some agencies maintain semi-permanent pre-cached bids with ad exchanges, and those may be examined before going out to additional demand side platforms for bids. The process for mobile advertising is different and may involve mobile carriers and handset software manufacturers.
Interstitial ads: An interstitial ad displays before a user can access requested content, sometimes while the user is waiting for the content to load. Interstitial ads are a form of interruption marketing.
Text ads: A text ad displays text-based . Text-based ads may display separately from a web page's primary content, or they can be embedded by hyperlinking individual words or phrases to the advertiser's websites. Text ads may also be delivered through email marketing or text message marketing. Text-based ads often render faster than graphical ads and can be harder for ad-blocking software to block.
Search engine optimization, or SEO, attempts to improve a website's organic search rankings in SERPs by increasing the website content's relevance to search terms. Search engines regularly update their algorithms to penalize poor quality sites that try to game their rankings, making optimization a moving target for advertisers. Many vendors offer SEO services.
Sponsored search (also called sponsored links, search ads, or paid search) allows advertisers to be included in the sponsored results of a search for selected keywords. Search ads are often sold via real-time auctions, where advertisers bid on keywords. In addition to setting a maximum price per keyword, bids may include time, language, geographical, and other constraints. Search engines originally sold listings in order of highest bids. Modern search engines rank sponsored listings based on a combination of bid price, expected click-through rate, keyword relevancy and site quality.
Mobile advertising is growing rapidly for several reasons. There are more mobile devices in the field, connectivity speeds have improved (which, among other things, allows for richer media ads to be served quickly), screen resolutions have advanced, mobile publishers are becoming more sophisticated about incorporating ads, and consumers are using mobile devices more extensively. The Interactive Advertising Bureau predicts continued growth in mobile advertising with the adoption of location-based targeting and other technological features not available or relevant on personal computers. In July 2014 Facebook reported advertising revenue for the June 2014 quarter of $2.68 billion, an increase of 67 percent over the second quarter of 2013. Of that, mobile advertising revenue accounted for around 62 percent, an increase of 41 percent on the previous year.
Considering that most marketing involves some form of published media, it is almost (though not entirely) redundant to call 'content marketing' anything other than simply 'marketing'. There are, of course, other forms of marketing (in-person marketing, telephone-based marketing, word of mouth marketing, etc.) where the label is more useful for identifying the type of marketing. However, even these are usually merely presenting content that they are marketing as information in a way that is different from traditional print, radio, TV, film, email, or web media.
Unlike television marketing in which Nielsen TV Ratings can be relied upon for viewing metrics, online advertisers do not have an independent party to verify viewing claims made by the big online platforms.
The European Union defines online platforms as "information society services that allow business users to offer goods or services to consumers, with a view to facilitating the initiating of direct transactions between those business users and consumers; they are provided to business users on the basis of contractual relationships between the provider of those services and business users offering goods or services to consumers."European Union, Online intermediation services – fairness and transparency for business users , accessed 14 November 2020 Almost half of the small and medium-sized businesses who responded to an Eurobarometer in 2018 said that they use online marketplaces to sell their goods and services.European Commission, Online platforms: Commission sets new standards on transparency and fairness , IP/18/3372, published 26 April 2018, accessed 14 November 2020
Publishers use a variety of techniques to increase page views, such as dividing content across multiple pages, repurposing someone else's content, using sensational titles, or publishing tabloid or sexual content.
CPM advertising is susceptible to "impression fraud," and advertisers who want visitors to their sites may not find per-impression payments a good proxy for the results they desire.
Like impressions, not all recorded clicks are valuable to advertisers. GoldSpot Media reported that up to 50% of clicks on static mobile banner ads are accidental and resulted in redirected visitors leaving the new site immediately.
Online advertisers can collect data on their ads' effectiveness, such as the size of the potential audience or actual audience response, how a visitor reached their advertisement, whether the advertisement resulted in a sale, and whether an ad actually loaded within a visitor's view. This helps online advertisers improve their ad campaigns over time.
Advertisers have a wide variety of ways of presenting their promotional messages, including the ability to convey images, video, audio, and links. Unlike many offline ads, online ads also can be interactive. For example, some ads let users input queries or let users follow the advertiser on social media. Online ads can even incorporate games.
Publishers can offer advertisers the ability to reach customizable and narrow market segments for targeted advertising. Online advertising may use geo-targeting to display relevant advertisements to the user's geography. Advertisers can customize each individual ad to a particular user based on the user's previous preferences. Advertisers can also track whether a visitor has already seen a particular ad in order to reduce unwanted repetitious exposures and provide adequate time gaps between exposures.
Online advertising can reach nearly every global market, and online advertising influences offline sales.
Once ad design is complete, online ads can be deployed very quickly. The delivery of online ads does not need to be linked to the publisher's publication schedule. Furthermore, online advertisers can modify or replace ad copy more rapidly than their offline counterparts.
Click fraud is especially associated with pornography sites. In 2011, certain scamming porn websites launched dozens of hidden pages on each visitor's computer, forcing the visitor's computer to click on hundreds of paid links without the visitor's knowledge.
Online impression fraud can occur when publishers overstate the number of ad impressions they have delivered to their advertisers. To combat impression fraud, several publishing and advertising industry associations are developing ways to count online impressions credibly.
Furthermore, advertisers may encounter legal problems if legally required information does not actually display to users, even if that failure is due to technological heterogeneity. In the United States, the FTC has released a set of guidelines indicating that it's the advertisers' responsibility to ensure the ads display any required disclosures or disclaimers, irrespective of the users' technology.
Use of mobile and desktop ad blocking software designed to remove traditional advertising grew by 41% worldwide and by 48% in the U.S. between Q2 2014 and Q2 2015. As of Q2 2015, 45 million Americans were using ad blockers. In a survey research study released Q2 2016, Met Facts reported 72 million Americans, 12.8 million adults in the UK, and 13.2 million adults in France were using ad blockers on their PCs, smartphones, or tablet computers. In March 2016, the Internet Advertising Bureau reported that UK ad blocking was already at 22% among people over 18 years old. As of 2021, 27% of US Internet users used ad blocking software, a trend that has been increasing since 2014. Among technical audiences the rate of blocking reaches 58% as of 2021.
Many consumers have reservations about online behavioral targeting. By tracking users' online activities, advertisers are able to understand consumers quite well. Advertisers often use technology, such as web bugs and respawning cookies, to maximize their abilities to track consumers. According to a 2011 survey conducted by Harris Interactive, over half of Internet users had a negative impression of online behavioral advertising, and forty percent feared that their personally-identifiable information had been shared with advertisers without their consent. Consumers can be especially troubled by advertisers targeting them based on sensitive information, such as financial or health status. Furthermore, some advertisers attach the MAC address of users' devices to their "demographic profiles" so they can be retargeted (regardless of the accuracy of the profile) even if the user clears their cookies and browsing history.
Consumers also face malware risks, i.e. malvertising, when interacting with online advertising. Cisco's 2013 Annual Security Report revealed that clicking on ads was 182 times more likely to install a virus on a user's computer than surfing the Internet for porn. For example, in August 2014 Yahoo's advertising network reportedly saw cases of infection of a variant of Cryptolocker ransomware.
As with offline advertising, industry participants have undertaken numerous efforts to self-regulate and develop industry standards or codes of conduct. Several United States advertising industry organizations jointly published Self-Regulatory Principles for Online Behavioral Advertising based on standards proposed by the FTC in 2009. European ad associations published a similar document in 2011. Primary tenets of both documents include consumer control of data transfer to third parties, data security, and consent for collection of certain health and financial data. Neither framework, however, penalizes violators of the codes of conduct.
The Online Intermediation Services Regulation (2019/1150/EU) or P2B Regulation came into force in all EU Member States and the UK on 12 July 2020. The Regulation aims to promote fairness and transparency for business users of online intermediation services or online platforms. The main aim of the Regulation is to establish a legal framework which will guarantee transparent terms and conditions for business users of online platforms, as well as effective opportunities for redress when these terms and conditions are not respected. Such transparency and fairness underpin improvements in the function of the Digital Single Market especially for the benefit of SMEs.Livingstone, C., Online Intermediation Services for Business Users (Enforcement) Regulations 2020 laid before Parliament , published 29 June 2020, accessed 14 November 2020 The regulations also set up an EU Observatory to monitor the impact of the new rules, called the Observatory on the Online Platform Economy.Observatory on the Online Platform Economy, About – Observatory on the Online Platform Economy
The UK's Online Intermediation Services for Business Users (Enforcement) Regulations 2020 replicate the effects of the EU Regulation.
Different jurisdictions have taken different approaches to privacy issues with advertising. The United States has specific restrictions on online tracking of children in the Children's Online Privacy Protection Act (COPPA), and the FTC has recently expanded its interpretation of COPPA to include requiring ad networks to obtain parental consent before knowingly tracking kids. Otherwise, the U.S. Federal Trade Commission frequently supports industry self-regulation, although increasingly it has been undertaking enforcement actions related to online privacy and security. The FTC has also been pushing for industry consensus about possible Do Not Track legislation.
In contrast, the European Union's "Privacy and Electronic Communications Directive" restricts websites' ability to use consumer data much more comprehensively. The EU limitations restrict targeting by online advertisers; researchers have estimated online advertising effectiveness decreases on average by around 65% in Europe relative to the rest of the world.
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