The Economics of Online Advertising

The current online advertising ecosystem has in many ways become very complex, featuring a host of contenders with heavy pockets. They are stranded in a crowded value chain all across the web with limited transparency as to which ads were visible and where they appeared. Unlike other forms of media, in digital marketing, it's possible for ads to be served, but not appear in front of a consumer. In fact, some served ads never make it into a consumer's viewport, and are therefore never have the chance to be seen. In addition, the cost of producing an incremental digital ad is either zero or near zero. These dynamics have created an unlimited supply of display ad inventory with a gaping inability to differentiate high quality inventory from low or no quality inventory.

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