To explore this broad and evolving type of advertising we need to begin by defining some terms:

·         Hits -- A fuzzy term meaning the number of times a webserver has been "hit" by a request for a webpage or a graphic image. Since perhaps 5 out 6 "hits" are for graphic images, the number of "hits" can be grossly misleading. Usually people mean by "hits" the number of times a webpage has been seen, but to be precise, the better term is "views," "pageviews," or "impressions."

·         Page impressions or pageviews -- Refers to the number of times a webpage has been requested by the server.

·         Banner views or impressions -- Refers to the number of times a banner has been viewed. Almost the same as "page views," but some banner server programs don't count the banner view unless the visitor stays on the page long enough for the banner to be fully downloaded from the banner server.

·         CPM -- A metric from the print advertising, meaning "Cost Per Thousand," using the Roman numeral "M" to stand for one thousand. A price of $15 CPM means, $15 for every thousand times a banner is displayed.

·         Banner ad -- An ad graphic hyperlinked to the URL of the advertiser. These are sometimes static graphic images, but animated rich-media banners do much better. The most common banner size used to be 468 x 60 pixels (Full Banner). To standardize, the Internet Advertising Bureau (IAB) specifies ad sizes in their Ad Unit Guidelines. The sizes they're recommending these days are 300x250 (Medium Rectangle), 180x150 (Rectangle), 728x90 (Leaderboard), and 160x600 (Wide Skyscraper). In fact, I don't see people following these IAB size recommendations very closely. You'll see a lot of 125x125 (Square Button) on sites, too.

·         Creative -- "Ad-speak" for the actual banner graphic.

·         Click -- When a visitor clicks their mouse on a banner ad, they are transferred to the advertiser's site. The number of responses to a banner ad is sometimes referred to as the number of "clicks."

·         Click Throughs -- Same as "click," commonly used to count the number of visitors who click on the banner and are transferred to the advertiser's site.

·         Click Through Rate (CTR) -- The percentage of click throughs to banner views. A 1% CTR means that 1% of each 1000 banner views (or 10 visitors) have clicked through.

·         Conversion Rate -- The percentage of shoppers in an online store who actually make a purchase. This varies a great deal, and depends a great deal on the quality of the landing page 

·         Cookies -- Small files written to your computer when you view a banner ad, visit a website, or put a product in a shopping cart. This helps the banner server to keep from showing you the same ad, or perhaps show you ads you might be more interested in seeing. Cookies are controversial, but are here to stay; too much of the Web is run by cookies to get rid of them. Cookies also allow an advertiser to track which banner ad a visitor saw that brought him to the advertiser's site, and which banner ads resulted in actual sales.

·         Run of Site (ROS) -- Refers to displaying a banner ad throughout a website or a banner network with no targeting by keyword or site category. Run of site advertising will probably cost less than more targeted advertising.