Online advertising for website owners explained

So which is the best format to choose? It depends greatly on what is being advertised. For example, a skyscraper can be suitable for some messages but not those that feature more than a few words, which don't translate well to a vertical format.

Data from AdRelevance suggest that MPUs are the most popular ads with advertisers, as they're usually easier to design and get more standout on a web page.

According to Tim Evans, global product manager for AdSense at Google: "The 300x250 ad unit performs well. Advertisers like this format; it's noticeable." It's good to pay attention to what type of ads are popular with advertisers – but what is more important is which ads work well with YOUR website.

Your site is unique: it has its own design and layout with its own features and quirks. Some ad formats will integrate well into your pages, but steer clear of those that may reduce the quality of your website. The ads should fall into the layout nicely. They shouldn't stand out like a sore thumb; nor should they be too subtle. You want your visitors to pay attention to them (especially if you're getting paid on performance, which we'll expand on later), but you also want the visitor to enjoy your website and your content.

"The key to successfully monetising your website is to effectively sell your white space for as much as possible, without reducing your customer experience," says Alison Guise, general manager for Commission Junction Europe and UK managing director of Mediaplex. "If the advertising is too intrusive this will cut down your traffic which will, in turn, cut down on the amount you can sell your space for."

It's a balance that is unique to every site and so can be difficult to get right. Consequently, Tim Evans advises "an interactive approach, experimenting with different ad units and layout, with a good content-to-ad ratio, to make sure the visitor has a good experience". It's also worth reading the IAB's research on what visitors think of, and how they react to, different format.

How to place ads

So how do you as a site owner go about placing ads on your site? There are three main options:

1. Talk to the advertisers directly. This involves setting up an ad sales team and building relationships with advertisers and their agencies. Only the larger websites would ever usually do this, as you're building a team from scratch and paying the salaries of ad sales specialists.

2. You're represented by an ad sales house. Ad sales houses represent a number of the larger websites and act as an easy buying destination for the online media planner/buyer (the person at the advertiser or agency that buys the advertising). The main sales houses include Unanimis and regional companies such as Media-Link and Agenda Media.

The ad rep at the sales house speaks to a number of ad agencies, building relationships and making sure that the websites they represent are pushed forward whenever the media planner has a suitable ad campaign to place. The benefits are that you don't have to pay any salaries, you only pay commission and can choose ad sales houses that already have good relationships and experience. However, this is really only for the larger websites out there.

3. You sign up with a network. This is the most popular option for the majority of websites. Networks have really increased in both size and stature in the past few years and are now a staple of any online media planner/buyer's repertoire of buying points.

Buying through a network brings new ad targeting options and an easy one-stop-shop place to purchase the advertising placements.

There are three types of network that you can deal with: Google AdSense (see box, below left, for details); ad networks (sometimes known as online display networks); and affiliate networks.

Ad networks

Advertisers choose ad networks because they have great targeting capabilities and their ads will get a high reach – the networks reach a high percentage of the UK online population, due to their size.

Ad networks enable advertisers to target on a 'behavioural' basis (eg "I want to target women that are interested in expensive clothes") or on a 'demographic' basis (eg "women aged 25 to 55").

Within an ad network, you as a website owner would be known as a 'publisher'. You go into a pool of sites within the network and place whatever ad formats suit your particular website (eg a skyscraper or an MPU). That's when the ad network's technology kicks into action, displaying the appropriate advertising onto your website.

Google adsense

Each network has its own technology to serve and optimise the ads on your website to get the best return. These systems quickly learn which types of ads work best on your website and then give you more of those.

"Very few websites will be able to sell their inventory as well as a network," says Guise. "A network will have access to multiple advertisers in a way that would be simply too time-consuming to replicate on a single-site basis.

"Quite often larger sites will have an in-house sales team to sell the easier content and then give the rest to an ad network to sell on their behalf. A network will also have the technology to measure and track your advertising spend and ensure that you get paid."

How the pricing and revenue for you works depends on the network and on your website. For example, with 24/7 Real Media, "pricing depends on multiple factors including content, audience and volumes," says Pangis. "We work with clients on an individual basis to determine revenue relationships for our media network".

When choosing an ad network, research carefully. Look at a few different networks to get a feel for the marketing. Some ad networks can be US-focused, so if your website visitor profile is very UK-based, make sure that that you stick to those networks that have a big UK presence.

Affiliate networks

Within an affiliate network, you as a site owner are known as an 'affiliate' or 'reseller'. You promote products and services in exchange for a commission on leads or sales.

You display the advertiser's display ads, text links or product links on your site, in email campaigns or in search listings. You're then paid a commission by the advertiser when a visitor takes a specific action such as filling out a form, subscribing to a service (a lead) or making a purchase (a sale).

The lines between ad and affiliate networks often blur. Most networks have both a 'media network' side and an 'affiliate network' side. Website owners can sometimes be part of both, but advertisers usually think of them separately.

They tend to use ad networks for fixed length campaigns, where their objectives might be to increase brand awareness or to stimulate a response (eg a sign-up or a sale) and they use affiliate networks for longer-term campaigns that are only response based, as a deal is agreed for them to only pay when the desired action is taken by the website visitor.

Try out different combinations of Google AdSense, ad networks and affiliate networks. Try to test them all before choosing the right solution for you and your website. In other words, experiment, experiment, experiment!