How do people advertise online?
Advertising is a major contributor to the internet economy. When you browse a web page, you will often see advertisements for other products and websites. Advertising online allows consumers to find out about new products and services that are available and gives businesses a cost effective way to advertise to their customers. While a company can spend a lot of money on a big billboard or TV ad and never know exactly how many people saw it, let alone actually acted on it, web advertising allows companies to track exactly how many people saw their ad, clicked on their ad and even how many actually purchased. There are two main types of web advertising.
Impression based advertising works basically like a billboard on the side of the road, except companies pay to advertise based on how many people see the ad. This is often used by big companies that are just trying to promote their brand and get awareness.
Pay Per Click
A more recent kind of advertising online is called Pay Per Click or PPC. This is when an advertiser only pays when someone actually clicks on their ad. This is far more cost effective than impression based advertising because the company is only paying for people who actually click on their ad and go to their website, rather than just anyone who sees their ad. The most obvious example of PPC ads are the “Sponsored Links” in the Google search results (see the how to use Google video). These are companies or individuals who have selected to have their ads placed near the search results when someone searches for some specific key words. When you click on one of these ads, you are taken to their website, and the company pays a small fee, anywhere from a few cents to $50 to Google for the traffic.