Banner Advertisement Pricing, Measurement, and Pretesting Practices: Perspectives from Interactive Agencies

This study reports findings from a survey of media directors of interactive advertising agencies regarding how they price, evaluate, and pretest banner ads. Results suggest that more than 90% of the responding agencies used cost per thousand frequently to price banner ads, whereas about 33% used click-throughs. In addition, a majority of the agencies used click-throughs and outcomes (e.g., inquires, purchases) rather than exposures to gauge banner advertising effectiveness. Although few agencies pretested their banner ads on a regular basis, most perceived the lack of measurement standards and independent auditing of Web sites as major problems facing Internet banner advertising. Findings from this study should provide benchmarks for future research on the topic and help facilitate the process of developing viable pricing and measurement standards on the Internet.