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Advertising Jargon

Before you search for and sign-up with advertisers, you need to know some of the key jargon. First off, from the advertiser's perspective, you are known as an affiliate, a Web publisher, or a content provider. These terms are important to know because, until your site gets big, you usually don't work with advertisers directly but rather sign up with them through advertising brokers. Good advertising brokers have hundreds of advertisers listed in a searchable Web site directory. You simply find the advertiser(s) you like and sign up via a simple form on the broker's site. It's common for advertising brokers to have separate sections of their Web sites devoted to Web publishers and advertisers. Remember, you're the Web publisher (or affiliate or content provider), so don't go into the advertiser section unless you want to pay for showing your banners on other Web sites!

There are five major types of advertisers you can sign up with:

  • Pay-per-click advertisers pay you some small amount (in cents) each time a user clicks the advertiser's banner on your site. A user clicking an advertiser's banner is known as a click-through. Usually advertisers only give you credit for one click per unique user per day. So, for example, say one of your users clicks an advertiser's banner at noon on April 1. You get credit for that click, but any other click from that same user on the same banner is ignored until noon on April 2.

  • Pay-per-sale advertisers pay you some percentage of sales each time a user clicks the advertiser's banner on your site and buys something from the advertiser's site. A word of caution: In my own and my students' experiences, pay-per-sale advertisements are not a good source of revenue for personal Web businesses. I only include them for the sake of completeness.

  • Pay-per-impression advertisers pay you some fraction of a penny for each of their advertisements that you display on your site.

  • Pay-per-lead advertisers pay you each time a user clicks the advertiser's banner on your site and fills out the advertiser's form.

  • Pay-per-search advertisers pay you each time a user uses the advertiser's search engine from your site to find something—you place the advertiser's search box on one or more of your Web pages.

Some advertisers combine payments, such as paying both per click and per sale, but most stick to one payment model.

Remember, these terms are from your perspective as a Web publisher. Advertisers have a corresponding set of terms, such as cost-per-click (CPC) or cost-per-thousand-impressions (CPM), which is basically what it costs them when your users perform the desired action. (M in this context is short for 1,000.)

Advertisers have a number of different vehicles for displaying their advertisements to your users. These are the four main advertisement vehicles:

  • Banners. By far the most common advertisement vehicle is a banner. The standard banner is 468 pixels wide by 60 pixels tall (468x60). However, banners come in a variety of shapes and sizes in addition to the standard banner (all measurements are in pixels, width by height): half-banner (234x60); stamp (125x125), half-stamp (120x60); sticker (120x30); and small sticker (88x31). Banners can be static, animated, or rich-media; the first two types are typically created with a standard paint program, while the latter are usually implemented in Flash, Java, or Dynamic-HTML, and include animation, sound, and interactivity.

  • Text links. As the name implies, a text link is a word or short phrase that links to an advertiser's Web site. The advertiser usually gives you the wording for the text link, which you aren't allowed to change. However, some advertisers permit you to create your own verbiage as long as it falls within their guidelines. Interestingly, although non-graphical, text links generally have a higher click-through rate (often abbreviated as CTR) than banners. CTR is the ratio of banner clicks to the number of times that banner is shown; or simply, the percentage of users that click a given banner.

  • Pop-ups (also known as interstitials). In contrast to banners and text links, which you display on your site's pages, pop-ups open in a separate window. Users activate a pop-up by viewing a page on your site in which you've added pop-up code. The pop-up code is usually JavaScript—given to you by the advertiser—that you insert into your Web pages. You can set up the code to pop up a window when the user either enters or leaves the page. You also have control over how often the advertisement pops up.

  • Go-behinds (also known as pop-downs). In response to users complaining about "annoying pop-ups," advertisers came up with the idea of "go-behinds." These are advertisements that are brought up in a separate window behind the user's browser. Thus, users only see the advertisement when they exit their browser window.

Suppose you've found an advertiser whose ads seem related to the theme of your personal Web business. For example, you have a golf Web site and you've found a golf magazine advertiser. Don't sign up just yet. There are at least five advertiser variables that you may want to consider:

  • Payout rate, or simply payout. This is one of the most important variables, since it's the amount you get paid for your user performing the advertiser's desired action—clicking a banner, purchasing an item, and so on. The payout rate depends on the type of advertiser. For example, pay-per-click advertisers usually pay 5–20 cents per click.

  • Payment threshold, also known as minimum payout. Although users may perform the advertiser's desired action, you may not get paid until your earnings equal or surpass the payment threshold, typically $25–50. If you don't meet the payment threshold, most advertisers will carry your earnings over to the next pay period.

  • Payment schedule. Unfortunately, advertisers don't automatically send you a check when your earnings exceed the payment threshold. They usually pay on a schedule, which is typically 30–45 days following the end of the month or quarter. Some advertisers pay more frequently than this (and conversely, some take longer to pay), but in general expect to wait for your paycheck to arrive.

  • Placement constraints. There are two kinds of placement constraints: layout constraints and vehicle constraints. Layout constraints are restrictions that advertisers place on the location of their ads in your Web pages. For example, some advertisers only allow you to display their banners if within the first 400 pixels of your Web page; any lower, and you don't get paid. Vehicle constraints are restrictions that advertisers place on non–Web page vehicles you use to display their ads. For example, an advertiser may tell you "no banners in pop-up windows" or "no banners in emails."

  • Tracking frequency. Most advertisers have a reports page you can view, which summarizes how much money you've made, along with key statistics such as how many times your users clicked a banner versus how many times that banner was displayed. Tracking frequency denotes how often this reports page is updated. The best tracking frequency is real-time, in which the reports are updated immediately. However, daily, weekly, and even monthly updates are not uncommon, especially for pay-per-lead and pay-per-sale advertisers.

Now that you understand some of the key advertising buzzwords, you probably could sign up with advertisers. But please don't do that just yet. I'll cover signing up with advertisers in detail in the next article. To optimize revenues, you still need to do some up-front preparation prior to signing up with advertisers.

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