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Karl Wabst on 21 Apr 09Chris Nolter Department store proprietor John Wanamaker is famously said to have quipped, "Half the money I spend on advertising is wasted; the trouble is, I don't know which half." The founder of Wanamaker's department store is known as the "father of modern advertising." His innovations, in late 19th-century and early 20th-century Philadelphia and New York, included publishing reliable prices in advertisements, copyrighting pitches, offering money-back guarantees and hiring a full-time writer to produce ad copy. A century later, advertising professionals have gotten more sophisticated and adapted to radio, television, outdoor and digital media. Wanamaker's observation about the value and effectiveness remains profound for merchants and manufacturers, as well as for media outlets that have seen broadcasting or print-advertising dollars reduced to digital pennies. The Internet has made the amount of space that can be filled with advertising virtually infinite, while the recession has all but emptied the advertising coffers of automakers, financial services firms and real estate companies. While digital media has disrupted the traditional ad business, it also presents the tantalizing promise to answer Wanamaker's question. Prior generations of digital advertising gave us spam and banner ads that tempted us with animated mortgage holders wildly dancing on the roof of their home or prizes for whacking a mole. The new proposition is that digital ads will allow advertisers to target audiences and track their returns on investment, and provide users with advertising and content that is more relevant. More than 400 advertising networks have come into existence to sell ad space on the expanding inventory of Web sites and pages. These networks connect advertisers with online publishers, often shopping ad space that a Web site's own sales staff cannot fill. Many of the networks cater to niches, such as food, wine, cars or sports. Increasingly, they are selling access to a
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