Banner Ads: Can They Work For You?

Posted by Christa Palm on December 04, 2010


Banner ads have become controversial lately. Many experts state that banner ads have been replaced by other means of internet marketing; however, many major companies continue to advertise using banner ads. Let's take a look at banner advertising to help you determine if banner ads are a good fit for your business.

What are Banner Ads?

To begin, we have to define banner ads. One of the first forms of advertising on the internet, banner ads began to show up as obtrusive and often annoying pay-per-click ads on the web. Typified by the traditional banner format at the top of an internet page, banner ads have been developed into half-sized ads, quarter-sized ads, and micro-ads, to name a few. Banner ads can either be very simple, or the ads can be developed into flashy, animated ads or rich media ads (with sound effects or videos).

What is the Purpose of Banner Ads?

Banner ads are produced to make increase business affiliation, provide advertising, and brand a new business into consumers' minds. Banners are mainly used to make the business' purpose known. In advertising, the more times a business name is seen, the more likely a customer will recognize the business later. This is known as branding. Though branding and advertising are the main purposes for banner ads, another perk to the ads is that an ad can create some income. Let's look at the cost and income portions in depth.

The Cost of Doing Banner Business

Banner ads work on a pay-per-click basis: Basically, every time a customer clicks on the banner, your business has a potential customer. The more customers who actually purchase your product, the cheaper the banner ad becomes to you. For example, say you have 100 people clicking your banner and you pay $0.10 per click. If all 100 potential customers make a purchase, your advertising rate per customer is only $0.10. However, if only 2 of those 100 customers purchase an item, your advertising rate is $5.00 per person. This can become very expensive as your clicks become more frequent without purchase.

The Perks of Hosting Banner Ads

The other end of the banner money spectrum is the potential income. If you have a site that gets a lot of business, you can sign up for banner ad hosting. In this case, every time another business' banner is clicked on your site, you get a small payment.

Banner ads have become controversial because studies show that text link advertising is a more trusted by consumers, and text link ads therefore receive more clicks. However, banner ads may be a good fit for your business to establish a brand name quickly. Though the ads may be annoying to consumers, they do encourage branding and may be a great introductory advertisement for your beginning business.

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