Online advertising covers all the ways you can make your internet audience aware of your products and services. It should be a major part of any strategy to build your presence online.
Consumers increasingly encounter and trust brands online, though the most trusted source of all hasn't changed. In Nielsen's 2021 Trust in Advertising study of some 40,000 people worldwide, 88% said they trust recommendations from people they know more than any other channel. Online formats, from search results to branded websites to opt-in email, continue to climb in trust as well, which is part of why global ad spending now tops $1 trillion a year, with the digital share growing fastest.
There are many ways to advertise online, along with different ways to pay for it. Here are the most common approaches.
Common Types of Online Advertising
Display and Banner Ads
Banner ads were among the first forms of online advertising. A banner is essentially a piece of "real estate" on a website that promotes your product or service. Sizes vary by placement and vendor, with common formats like the 728x90 leaderboard or the 300x250 rectangle, positioned where they'll get the most visibility. People do scroll now, so you don't have to chase the old "above the fold" rule as rigidly, but prominent placement still helps. Your creative can be static or animated.
Be realistic about performance, though. After decades of exposure, most people tune banners out, a phenomenon known as "banner blindness," and click-through rates are typically a small fraction of one percent. Display still has its place for building awareness and for retargeting (more on that below), and these days it's usually bought programmatically, with software placing your ads across many sites automatically based on who you want to reach.
Text Ads
A text ad is just a few words of copy, linked to your website, with no images. You'll most often see them today inside search results and within native or contextual placements. Like banners, they only work when you put the right message in front of the right audience.
Search Engine Ads (Paid Search)
Paid search remains one of the most effective forms of online advertising, because your ad appears exactly when someone searches for terms related to what you sell. The intent is already there; you're just meeting it. To get the most out of it, continually research and refine your keyword lists, watch the search terms people actually use on Google and Bing, and analyze the results for trends and opportunities. For retailers, shopping ads (the product listings with photos and prices at the top of search results) are an especially strong format.
Video
Online video keeps gaining ground, and for many advertisers it now rivals or beats traditional TV for effectiveness. The landscape is much bigger than it used to be: YouTube, short-form video on TikTok, Instagram Reels, and YouTube Shorts, and connected TV (CTV), the ads served through streaming services on smart TVs. Your job as the advertiser is to find the platforms that best fit your audience, choose the right format for each, and decide up front how you'll measure whether the ad worked.
Email is one of the activities people do most online every day, so it makes sense to advertise where your audience already is. There are a few approaches. A solo ad is an email a publisher sends to its own list focused entirely on your offer; these can cost more, but they're measurable and can deliver a strong response. Newsletter sponsorship, buying a text ad, banner, or logo placement inside someone else's newsletter, has surged in recent years thanks to the boom in creator and niche newsletters. One word of caution: renting or buying email lists, once common, is now discouraged. It runs into privacy laws and hurts deliverability, so growing and mailing your own opt-in list is almost always the better investment.
Social Media Ads
Millions of people, very likely including your audience, spend part of every day on social platforms like Facebook, Instagram, LinkedIn, TikTok, and X (formerly Twitter). Their targeting tools let advertisers zero in on specific audiences, which makes social a prime place to promote your products and services. It's also no longer a small line item: global social media ad spend reached close to $250 billion in 2024, roughly a third of all digital ad spending, according to DataReportal, and it's still growing.
Native and Sponsored Content
Native ads match the look and feel of the platform they appear on, like a "recommended" article on a news site or a sponsored post in a social feed. Because they blend in (and must be labeled as advertising), they tend to feel less intrusive than banners and can earn more engagement, as long as the content genuinely offers something useful rather than just dressing up a hard sell.
Retargeting
Retargeting (also called remarketing) shows ads to people who have already visited your site or engaged with your brand but didn't convert. Because you're reaching people who already know you, it usually delivers some of the best returns in digital advertising. It's why the product you looked at once seems to follow you around the web.
Mobile
Mobile isn't a separate category so much as the default setting for everything above. The majority of digital ad spending now goes to mobile, because that's where people are: most searches, social scrolling, video, and email happen on a phone. The practical takeaway is to design mobile-first. Make sure your ads, and the pages they lead to, look great and load fast on a small screen. As always, the key is matching the right audience with an ad and an offer compelling enough to earn a tap.
Pricing Methods
Cost-Per-Mille (CPM)
CPM is the traditional pricing method, billed per 1,000 impressions. It's tied to inventory rather than performance, which is why many publishers prefer it: if they know how many people will see your ad, they can calculate the fee. CPM works well when your goal is awareness and reach.
Pay-Per-Click (PPC) / Cost-Per-Click (CPC)
PPC, also called CPC, is a performance-based model: you pay only when someone clicks your ad, no matter how many times it's shown. Marketers, especially small and mid-sized businesses without a household-name brand, tend to prefer it because the risk is lower than with CPM, it's straightforward to run, and you can scale it up or down to fit any budget. (You'll also see performance models that charge per action or conversion, such as cost-per-acquisition, when the goal is a sale or lead rather than a click.)
What's Next?
The online advertising world moves fast. By this time next year there may well be a new format or platform in the mix. But the fundamentals don't change: this is where your audience spends its time, so your business needs a strategy to put the right message in front of the right people. If you'd like help building one, our team can help.
This is part of our guide to marketing your small business online.
0 Comments