Targeted online marketing started with banner ads. In its infancy, publishers paid lots of money for these ads. They were based upon either CPI (cost per impression) or simply displayed on sites that received a lot of traffic.
It was interesting to discover that this type of advertising did not work well on the Internet. Based upon the traditional business model of providing content, banner advertising was not working in this non-traditional environment.
In the meantime, a company called GoTo, which became Overture, and which was eventually bought out by Yahoo!, was busy developing a new type of advertising strategy: keywords. With this method, companies would bid on a per-click basis for certain keywords or phrases which would send traffic to the companys web site.
This new advertising method was successful because it brought visitors to a site based upon relevance. Since the company only bid on keywords or keyword phrases that represented their product, the companies were only paying for visitors to their site who had already expressed an interest in the product or service.
Google decided to take this even further. It was already displaying on its home page targeted online advertisements. It now created Adsense where owners of websites could sign up and place ads on their site. Google would ?read the pages content and, based upon that, would display targeted online advertisements.
Next came Gmail, Google's free email service. It could be provided free because ads similar to the Adsense model were being displayed on the same pages where the user viewed their email. And how did Google know which ads to display? Simple. Google just 'read' your email! Did this bring up privacy issues? A lot of people thought so.
A BRIEF HISTORY OF ONLINE ADVERTISING
Updated: 10/25/2008 14:14
Targeted online marketing started with banner ads. In its infancy, publishers paid lots of money for these ads. They were based upon either CPI