Let's tackle the position part of the online advertising equation. When you're advertising online, you place your ads on a web page. In most instances you can dictate both where on the page your ad appears as well as on what websites.
When you're managing a display ad, you routinely have the choice of several page placements. Many sites offer advertising across the top of the page (socalled banner advertising), along the right or left sides, across the bottom from the page, or in a box somewhere in the middle. Not all sites offer all positions, of course, but you'd be amazed at what's available if you're willing to pay for it. Page placement is less assured when you're running pay-per-click advertisements.
Bid lower, and your ad will probably appear lower on the page. It's a type of pay for placement deal. Equally important, you can easily place your ads with just those websites that meet specific targeting requirements. You can choose specific sites where you want to appear or identify sites by their traffic or demographic values. And with pay-per-click ads, you let the ad network determine which sites to use; you identify (and pay for) certain keywords, and your ad appears on sites with content that matches those keywords. You can't get much more targeted than that.
The thing is, online advertising is more about narrowcasting than broadcasting your message. Traditional media tend toward the broadcast model, where your message is out to a large audience with a lot of waste, and you end up overshooting your audience. In contrast, online media are very targeted. If you simply want to reach 45-year-old males who read comics, you can do it; you don't have to show your ad to everyone and their brother, either.
There's an old saying among advertisers that you realize that only half of your advertising works, however, you don't know which half. Well, with online advertising, you can quickly and easily determine which half of your advertising is working down to a specific ad on a specific website. That's because online, you can track when an advertisement is clicked. That's right, when someone takes action by having an ad, you know it. There's no guessing whether this ad or that drove a given person into a store to make a purchase; you know precisely which ads delivered the most traffic to your website.
This puts a lot more responsibility you as an advertiser, obviously. There's no more waffling about a given ad enhancing your brand image or planting the seeds of a sale or another happy horse manure. Online, an advertisement either gets clicked or it doesn't. You know immediately whether your advertising is working by tracking the traffic in the ad to your website. The more clicks you get, the more effective the ad is. If you don't get any or many clicks, then you know a particular ad is in the half that doesn't work.
This capability to track ad results clearly distinguishes online advertising from its offline brethren. With traditional advertising, there's not a way to know how effective any single ad is; sure, you can tell if sales go up during the course of a campaign, but you don't know which ads in which media truly drove those sales. With online advertising, there's no way not to understand how each ad has been doing; you get near-real time data that can help you tweak your future ad content and placement.
This mixture of relevant placement and improved tracking makes online advertising a much more efficient investment kinds of advertising. You don't need to engage in broad placement when you only want to target a narrow audience. You don't need to put up with half your ads no longer working when you can easily determine which ads are pulling customers and which aren't.
The upshot is that you can typically get better results with less investment online. Now, you might not get the broad reach that you do with traditional media, however, you also don't pay for that broad reach. You can create very targeted ads for any very targeted audience, which will likely result in higher response rates. In short, you can target the exact audience you want, and pay just for those results.
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