Adverts are silly, long time annoyances that we have long become accustomed to. We all know their purpose, they help companies raise money. Their inclusion on websites was, for a time, very, very annoying. Pop ups plagued web pages and popular sites we visited. We can’t bypass ads on TVs or in movie theaters but we can easily avoid them on websites and the like. But by doing so we may be driving our favourite websites into financial dire straits.
Let’s take for example those who are hardest hit: print and news media. With online news faster and more accessible than traditional newspapers or periodicals, they have turned to online publication to save costs and meet the consumer demand. Their advertising revenue has converted to those streams as well. Online advertising can be very lucrative; Google earns billions annually. The issue lies in how websites hosting are paid. Revenues can be very slow for sites that have tons of exposure but very little click through. In fact, clicking a few interesting or relevant ads will easily provide the company with as much revenue in a month as your subscription used to. Clicking on those few ads is actually a free way to pay for a service.
To understand why we need to click through, we need to understand how advertising revenue works.
Views per 1000 versus clicks per 1000
One of the most popular ad services online, Google Adsense/Adwords, is most likely the service serving up the ads on the website you visit. They pay host sites using two measurements: one measures how often your website displays an ad and how many times it’s clicked. You’re repaid using one of these two metrics and clicks are worth tons more than exposures. Websites that click more ads with less views will earn more money that have thousands of views but only a few clicks. Websites that only have views, however, earn substantially less than one that only has a few clicks per 1000 views, in an order of magnitude. One click in a thousand is worth 2-5 times more than simply a thousand views.
Websites with a lot of popularity can earn sums of money simply from a value per 1000 rating. This rating basically says how valuable your website is to companies who want exposure. It’s the same reason why companies pay tens of millions for advertising space during the Superbowl: massive audience is massive exposure. That being said, your click through percentage is worth way more. It’s through the combination of these two metrics that a website is paid. So when you simply visit a website and you’re displayed an ad that site receives a small fee for showing that ad to you. By clicking it you give the website a nominal fee but much more than before.
Why you need to click appropriate ads
Simple; its how they’ll make money. In a real life example we can look a website I frequent: National Post. By visiting their site I consume resources: reporter time, staffing time, electricity, server hardware etc. All these costs go into just serving up my website view. By viewing a few articles and leaving I’ve consumed, albeit a fraction of their total monthly usage, now they’re operating at a loss. When you add up daily usage it might become a death by a thousand cuts situation. That said, those who do click on ads or the overall popularity of the website will likely help them turn a small profit. Clicking on ads helps offset the cost of those who don’t.
Getting people to click ads is the subject of a lot of science and study. Websites like Facebook or Pinterest only turn a moderate profit from ad revenues, sometimes even incurring losses. They have put great effort into creating adverts that you want to click on. When you click on an ad the advertising service remembers that click and gives that ad priority over other ads on the page. This is why it’s important to only click on ads that you like or are relevant. If you click on a certain ad expect to see a lot more of that ad.
A lot.
Since Google runs the AdAware service, used by pretty much everybody, and cookies are placed onto your computer about your browsing/ad click history, that ad will start to appear everywhere. If you simply click randomly you’ll find yourself seeing lots of weird ads not only on your favourite websites, but everywhere else.
Simply put, adverts are a modern form of commerce for websites. There isn’t any sale of products like amazon but they do provide a service. It’s only fair that we return the favour every now and again by clicking on an ad. There are sites that depend on it.