If you use the Internet then you are already familiar with the ubiquitous banner ad. A banner ad is a long, thin advertisement typically appearing on the top of a web page. Banner ads often use specialized graphics and animation to draw the user’s attention and encourage them to click the ad.

With the cost of other forms of online advertising, such as Pay per Click advertising, becoming increasingly expensive, the use of banner ads is on the rise again.

The primary goal of a banner ad is to entice the people visiting your site to click the ad. Clicking the ad will then redirect that person to the advertiser’s site.

The effectiveness of banner advertising is easy to measure. Software can track the number of times the ad is displayed (impressions) and the number of times the ad is clicked (clicks). This information can be used to calculate the percentage of time someone clicks on the ad (click through rate).

Banner ads also offer your website a branding opportunity each time the ad appears. Unfortunately, it’s nearly impossible to measure the value these impressions may have for the advertiser.

Banner ads are often sold by the CPM* or cost per 1000 impressions. Ads that cost $10 per 1000 impressions will be advertised as $10 CPM.

Targeted banner advertising can be very effective and offer a high ROI (rate of investment) if you advertise on the right site. However, it’s equally easy to pick the wrong placement and blow through a huge number of impressions without making a single sale. Like other advertising, it’s best to test banner ad spots and carefully measure their effectiveness before signing on for a long term or expensive advertising campaign.


*CPM makes more sense as an acronym when you remember that M is 1000 in the Roman number system.

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