The online marketing advertising business has become a huge industry and has been giving traditional media a stiff competition in terms of revenue and reach. Many large corporations have recognized the benefit they will get from online advertising that they allocate huge amount of money into it in their annual marketing program.

However, despite the fact that online marketing advertising business has become a part and parcel of our daily life, majority of us do not really understand how the online advertising industry really works.

Defining your product

Before we try to understand the nitty-gritty of online advertising, we must first understand our product. Identify what is your product? The products is advertising inventory also widely known as ad impression. This means the volume of opportunity to sell adertisement in every medium. The single viewing of a single ad by a single individual is also called the ad impression or opportunity to display.

The Publishers, or the web site owners, and developers of software, video games or emails creates these advertising inventories. These so called publishers can create huge amount and contant supply of ad inventories that they can turn into profit.

How to compute ad inventory

To better understand what an ad inventory is, you must learn how it is computer. One batch of advertisement per impression is derived when a website has basic functionalties such as simple online advertising features. You can compute advertising impression using two principles. These are the number of page impressions generated by the web site and the average number of ad per page. To put it simply a one million page impression per month and an average of 5 ads per page will result to 5m ad impressions per month (5 x 1m = 5m).

Who are the publishers

As mentioned above, Publishers refers to the site owners, or builders of game, mobile portal, etc, which have created advertising inventory to sell to advertisers with the intention of generating income.

Because their goal is to sell as much of their advertising inventories as possible, Publishers normally hire sales teams to engage advertisers and advertising agencies to conduct business. However, small-time publishers resort to Ad Networks to sell their ad inventories

Some of the biggest Publishers with large amounts of ad inventories are the search engines, such as Google, Yahoo, MSN, etc. Because of their size, these large groups have the advantage of going directly to advertisers and ad agencies to sell their advertising inventories.

These are some of the major players in the online marketing advertising business, next time we will discuss the other players in the game.

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