Why do internet ads make so much money?

There are two types of Google Ads - There is AdSense, mentioned here already, where (anybody’s) website has Ads posted on it and the website gets a small commission whenever somebody clicks one of the ads.

Then there is ‘AdWords’ - these are the green ads on the right hand side when the Google site returns search results. It’s quite common to get 1% clicks/impressions ration. And a lot of people search with Google every day.

I sell my software products from a web page and use Google AdWords to bring potential customers there. Google Adwords now results in about 50% of my customers and I’m a ‘little fish’. I do not use Google AdSense on my own website because the last thing I want to do is let a customer click away once they’ve come to my site.

But the internet is different because you aren’t forced to watch them, as you are in between programs on TV, although it is starting to get the same problem with the introduction of Tivo. If people in the 1920s for radio or the 1950s for TV had had the ability to block ads, the whole scheme could have been different. What if you had to subscribe to all individual channels ala HBO?

Since banner ad fees are paid to the website per-view (or per-unique-view) and Google ads pay the websites per-click, it means that the website owner has a better ability to determine the ratio of bandwidth used per banner ad displayed, as opposed to hoping that Google places the right ads on the right pages so that users click on the links.

I spend on Google Adwords and get great revenue for our company. The advertisements have easily paid for themselves. Online adverstising is still very small, however:

North American Advertising Expenditures in 2006

Direct Mail: $55.9 Billion
Internet: $9.3 Billion
Yellow Pages: $14.3 Billion
Radio: 19.6 Billion Television: 66.2 Billion
Magazines: $13.4 Billion
Newspapers: $44.7 Billion
Misc.: $54.5 Billion

You’re making the wrong comparison. The Internet is much more like newspapers and magazines in the way ads are displayed and can be skipped or not.

There are some differences between the way readers browse newspapers/magazines and the way they read web pages. For instance, text attracts web readers more than images, which is the reverse of newspapers and magazines. Here is an eyetracking study that shows this, in part.

You have a point, but the big difference I see is that newspapers’ classified ads used to be the only way to find used items, jobs, and services locally. It’s one of the reasons why they’re dying out. So those ads were a lot more useful to people then than internet ads are now.

Many are pay-per-click, but there are some that operate that way. I personally find a lot of sites recently having some success with, say, Project Wonderful which allows companies to bid on your site based on a calender via an auction interface, this eliminating mass clicking schemes as well.

To respond to the original post. I have clicked on a few, one was the aforementioned “OMG PROOF OF GODS EXISTENCE!” but that wasn’t for pay. The only other ones off the top of my head are:
Sites I already go to and took a shortcut via add (a lot of times webcomics or game sites sell adspace to each other)
A webcomic I thought looked interesting (I found Dreden Codak from Quesitonable Content and now its one of my favorite webcomics)
Snorg Tees, they looked funny enough… I even bought a couple.

I haven’t clicked on mayn but as stated above I definately have clicked on some.

You’re confusing classified advertising with “true” advertising. Those services that are now on relator.com, craigslist.com, kudzu.com, autotrader.com, monster.com etc are the ones that are comparable to newspaper classified content.

The advertising that is wrapped around content like classified advertising is the subject of this thread, classifieds are a whole other business model. It’s obvious why classified ads make so much money, there’s no need for the OP.

An example of that:
Article on how the U.S. Census Bureau’s web site managed to successfully hide its most prominent data point - the population of the U.S. by displaying it in large red numbers, which made most site visitors think ‘ad - disregard’

Search Engine Spammers must make a mint. I define Search Engine Spammers as sites that are nothing but a listing of other sites. I get them a lot while searching for electronic parts.

Here’s the index page for SE Spammer that I found in another thread. Click on any category and you’re taken to a page of ads. Not this particular site but I often get these ad pages from similar spammers on a Google search. Say I’m looking for part xyznnn. A Google search will turn up these spammers with nothing but a list of all similar part numbers. Kind of like porn pages did with metas, putting a dictionary into a content meta.

I’ve never been forced to watch ads on TV. When they come on, I’m perfectly free to take a bathroom break, or go back to the crossword puzzle I’m working on, or talk with the other people in the room, etc.

My wife’s business relies heavily on such ads. They’re a legitimate, stable business that sells an ordinary, legitimate product, and it’s sold primarily through the internet (it’s a subscription-based service, for the most part.) The clicky ads work.