Why are so many people down on banner ads? Honestly, this is getting out of hand! I’ve heard people use language like "Banner Ads Suck" to blast into the effectiveness of Internet advertising. Others say it less blatantly, often while promoting their own alternative way to capture customers.

Now I’m not one who really enjoys advertising (web based or not), so let’s make that clear. Many sites feel like a Las Vegas strip with banner ads popping out everywhere. Ads on other sites are plainly tasteless and they annoyingly bounce around with the ever-present call-to-action "Click Me", "CLICK ME!" It seems there are plenty of good reasons why banner ads should be attacked.

But let’s not indict a possibly good advertising strategy because of bad tactics. That’s a classic trap in business.

True, click through rates hover at a pitifully low level (about 0.6%according to 1999 Nielsen/Netratings figures) and they appear to continue to fall. But banner ads are effective in other ways.

The View from Academia

Rather than rely on personal opinion, intuition, or the claims of DoubleClick and other web advertising companies (who have an incentive to say banner ads work), let me report what empirical studies in universities are documenting.

Banner ads can make people aware of a product, associate a brand name with what a product stands for, lead to higher recall, build brand equity, and sometimes create a positive brand attitude. Ads that are highly relevant to someone in a buying mood are the most likely to be clicked.

Many banner ads, however, are not even viewed. Is this a problem?

There is evidence that suggests web surfers who don’t report seeing a banner ad take in ad information anyway. This effect is called "pre-attentive processing." Studies in marketing and psychology have neatly documented this human process and the punch line is this: your ad doesn’t need to be directly viewed to get into a web surfer’s mind.

But you probably already know that banner ads can have these effects. So do we academics.

In fact, these results are so unsurprising that virtually no published papers on banner ads exist in top level marketing journals. The editorial reviewers, an ornery lot who cut through hype and publish only scientific contributions, simply can’t find anything unique about banner ads and its effects on people that hasn’t been found for TV, magazines, radio, and billboards.

So why do people still put a negative rap on banner ads? I think this is for several reasons.

First, the net has revolutionized the opportunity to purchase products by eliminating the distance between information and products. We can get information about computers and also go to sites like Outpost.com and buy one. As a result, some expect people to buy using reflex actions. But the net hasn’t repealed the laws of human psychology and people don’t react reflexively, unless of course they’re standing in a grocery store checkout line.

For example, go to ESPN and you’ll sometimes see a banner ad for United Airlines. If you don’t click on it (because you’re there to read about sports and not travel), does that mean the United Airlines banner ad doesn’t work? No. Just like ads in the offline world, your awareness and recall for United Airlines will increase and the more likely you’ll think of United Airlines when you do make travel plans.

Second, people seem to demand click-through measures of effectiveness because they can measure a click though rate. This is much easier than measuring and diagnosing why a banner ad works or not, yet few people seem to care about this (but I’m sure you’re glad your doctor cares about diagnosis).

Finally, some people who accept the idea that click through rates aren’t a good measure of effectiveness think that web ads will work only when we get graphics, audio, and other rich forms of communication promised by broadband technologies. But that’s not true. Ads worked long before television appeared, and we know that in certain cases rich moving graphics will actually hurt awareness and brand knowledge.

Some Perspective

I often think about the packaged goods companies like Procter and Gamble and General Mills and how a long, long time ago they had to learn about how advertising works. That’s because they were transforming commodity products (soap, rice) into branded products. Really understanding targeted advertising and how consumers process information has always been important to them. But they’re considered part of the old world economy, aren’t they?

Then I think about the "new economy" companies and how they’re struggling to understand and accept the same basic advertising concepts that are applied to banner ads. It’s ironic that the sexy "new economy" way of doing business is, in fact, grappling with the long-resolved old economy problems.

Let’s not trash banner ads because we’ve got a short term focus and completely unrealistic expectations about banner advertising and the way it works on people. Banner ads can still create brand awareness and make it more likely that consumers will think of the brand the next time they are in a buying mood. Isn’t that, after all, the purpose of advertising?

Allen Weiss is the founder of MarketingProfs.com.