Banner Advertising Costs

Before you spend money on advertising online, it would be a good idea to learn about banner advertising, including costs, effectiveness and models. In this article, we'll tell you what is banner advertising and how the cost for such ads is determined.
MarketingWit Staff
Surfing the net is one pastime that most of us indulge in on a daily basis. The Internet has become a necessity in our lives with most of our work being done on online portals. While visiting these websites, we come across flashy ads which direct us to different web pages that advertise umpteen number of products. This form of Internet advertising using banners with hypertext links and flash images is known as banner advertising. Users, on clicking these pages, are directed to products and webpages where they can order them. Of late it has been experiencing a slump due to the ease with which these ads tend to be ignored, decreasing the effectiveness of the advertisement.
Costs not only depend on advertising on the host webpage but on the action that the user performs after viewing the ad, which is either performing an activity that leads him to the advertiser's page directly or by clicking on the ad. Low costs make it an effective advertising technique for companies that cannot allot huge funds for marketing and promotion.
What is Banner Advertising?
One of the most common ways of advertising on the Internet is banner advertising. In simple terms, it is an advertisement that uses a hypertext link, inclusive of graphics to direct the user to a page that the advertiser wants to market. While initially banner advertising was extremely popular, in recent years the effectiveness of this form of marketing has been questioned, resulting in a severe drop in the number of people using banner advertising as a method of promoting their products. But regardless of the supposed drop in banner advertising effectiveness, the fact remains that these ads tend to create an impact on the visitor's mind. This subconscious effect or subliminal perception of the product, has been known to increase the sales of the product being advertised. Also with the increasing time that we spend in front of the computer, the chances of a visitor viewing an ad and possibly being directed to the webpage an advertiser intends to promote, also increases.
But there is a definite downside to banner advertising. Most banner ads tend to be viewed as some sort of distraction for a user who is working on something important. Also there is no specific way of determining whether these ads are reaching out to the intended target group or customer base. It is in view of such concerns, that costs have been cut down drastically in the recent past. In case you are interested in opting for banner advertising, then one of the determining factors where the cost of banner advertising is concerned is the size of the banner ad. As per the Internet Advertising Bureau, there are eight types of banners that you can opt for in case of banner advertising, out of which the most popular one is the full banner.
Type Width (in pixels) Height (in pixels) Aspect Ratio
Full Banner 468 60 7.8
Half Banner 234 60 3.9
Micro Bar 88 31 2.84
Button 1 120 90 1.33
Button 2 120 60 2
Vertical Banner 120 240 2
Square Button 125 125 1
Leaderboard 728 90 8.09
One of the main factors that affects the rate of advertising is how popular the website you are advertising on is. More popular the website you are advertising on, more the chances of your ads being clicked on. Many advertisers also prefer advertising on pages that have content that is relevant to the advertisement. Another major determiner of cost is the content of the ad. The position of the ad also plays an important role in determining the cost of banner advertising. Another cost that many advertisers tend to forget to add to their expenditure are the charges of the designer designing the ad for you.
The average cost of banner advertising as of today is around 20 USD per 1000 impressions. On websites where the rates are higher than this, it is because of the premium status of the website. Advertising costs also increase indirectly if the ad is advertised on a page with content relevant to the article. This increases the chances of the user clicking on the links advertised. There are different models that can determine the cost of banner advertising.
  • Cost per Impression: Costs depend on the number of impressions, i.e. the number of pages the ad is displayed on.
  • Cost per Action: The advertiser is charged on the basis of the action that the customer performs after viewing the page.
  • Cost per Click: The pay per click form of advertising charges the advertiser every time a visitor clicks on the ad.

The pricing model used is one of the major determining factors for advertising costs. Understanding the good and bad points of banner advertising is important as these help to determine whether or not the costs that the advertiser has to incur is worth the expense. Without understanding the effectiveness of an advertising method, it would be foolhardy to opt for it.