How Web Ads Work
You visit this blog every day (and if you don't, why the heck not?!). Sometimes you notice the ads on the page, sometimes you don't. Regardless, ever wonder how they help offset the costs of running a Web site/blog? Ever wonder how they get on the site? Well, it's time for a little primer. Web Ads 101, if you will.
There are two basic kinds of ads, display ads and text ads. Text ads are slowly being phased out, though our friends over at Neatorama still use them on post pages. The one pictured to the side for GoPro Cam is a good example. These ads are dynamically fed into the page by Google AdWords, who figure out what kinds of ads to place on the page based on what kinds of keywords they see in the post itself. The title of the post can often influence the Google placement bots, which is how you sometimes get those funny juxtapositions; a post about the benefits of nuclear power can trigger a text ad to sign a petition against nuclear power. A Web site makes money when you click the text and go off to the petition Web site. How much money? It depends on the size of the Web site, the placement of the ad, and a bunch of other factors. But it's not much money at all.
Much more common are display ads. These come in various sizes and shapes known in the industry as leaderboards, skyscrapers, blocks, and in rare cases, page skins where the sponsor takes over a page and wraps the whole site with their campaign. These ads are very rarely click-based, meaning they don't need to be clicked for the Web site to make money. The bulk of display ads usually earn between 25 cents and $1 per every thousand impressions, or views. Some campaigns on popular Web sites earn a lot more, but the traditional "run-of-network" ad (sometimes called "backfill") is generally under $1 per 1000 impressions. With display ads, the advertiser is looking to get the brand out there in front of you and is willing to pay whether you click through or not. On average, .02% of people will click through on any given ad—so it's really more about raising company/product/brand awareness.
Of course, there are lots of different kinds of ads making their way onto pages. Pop-ups, ads that expand when you roll over them, video ads, lightbox ads that need to be closed before you can view a page, gates that prevent you from seeing the content until you watch a few seconds of flash video, and others. But display ads are still far and away the most common because they're the easiest to work into site design and the least obtrusive.