Beautiful Security

Advertisers As Victims

It’s tempting to blame advertisers for all that goes wrong with online advertising. After all, advertisers’ money puts the system in motion. Plus, by designing and buying ads more carefully, advertisers could do much to reduce the harm caused by unsavory advertising practices.

But in some instances, I’m convinced that advertisers end up as victims: they are overcharged by ad networks and get results significantly worse than what they contracted to receive.

False Impressions

In 2006 I examined an online advertising broker called Hula Direct. Hula’s Global-store, Inqwire, and Venus123 sites were striking for their volume of ads: they typically presented at least half a dozen different ad banners on a single page, and sometimes more. Furthermore, Hula often stacked some banners in front of others. As a result, many of the “back” banners would be invisible, covered by an ad further forward in the stack. Users might forgive this barrage of advertising if Hula’s sites interspersed banners among valuable content. But, in fact, Hula’s sites had little real material, just ad after ad. Advertising professionals call these pages “banner farms”: like a farm growing a single crop with nothing else as far as the eye can see, banner farms are effectively just ads.

Industry reports indicated that Hula’s advertisers typically bought ads on a Cost Per Thousand Impressions (CPM) basis. That is, they paid a fee (albeit a small fee, typically a fraction of a cent) for each user who ...