Online advertising has exploded as an alternative to print and broadcast placements. During the third quarter of 2012, online ad revenues reached a record $9.3 billion in the U.S. alone, an 18 percent increase over the same quarter in the previous year. You can create, place and benefit from website-based advertising in much less time that you need to develop other forms of outreach to customers who may be interested in your company and its products or services, but that doesn't mean this new option lacks disadvantages.


Although some consumers don't object to viewing ads on the websites they visit, others either ignore or refuse to click on them. Because these ads appear in a setting within which the viewer may not expect to see commercial messages -- on a news or informational site, for example -- your message runs the risk of failing to connect with an audience that dislikes and even distrusts online ads. Because online ads run above or alongside the content viewers really want to see or read, they can be seen as nuisances rather than added value.

Measuring Effectiveness

Measuring the reach and effectiveness of online advertising can involve evaluating complex, ongoing sets of metrics. Even after you crunch the numbers and look at how many sales you convert from the ads you place, these simple measurements may not tell the entire story of how effectively your message gets across. Everything from how you pay for your ads -- by the click or by the sale, for example -- to where your ads appear plays a role in how well your online outreach works. Evaluating the full range of outcomes can require time and statistical savvy.

Click Fraud

Depending on how you pay for your online advertising, you may encounter a common form of ad-result fraud based on inflated clickthrough results. If your ad placement costs rely on the number of clicks your messages receive, your competition can pay people to inflate the click rate and drive up your costs. These deceptive strategies can cost the competition much less than they do you.

Ethical and Privacy Concerns

As an online advertiser, you need to remember that even though your commercial messages appear on websites instead of in print or on broadcast media, your ads must comply with applicable laws that regulate truthfulness, disclosure, claims from unhappy customers and other regulations. These regulations can vary from state to state and country to country. At the same time that you face compliance mandates from government, you also can encounter consumers' ethical concerns about the use of cookies, Web bugs and other tracking mechanisms to aggregate together their online clicks.