For almost as long as Americans have looked to the Internet for news, weather, sports scores, and other valuable and entertaining information, online advertising has fueled the availability of such content. Initially, ads were customized—if at all—only on the basis of the site the user was viewing. Advertisers had little insight into how effective their ads were or how users interacted with them.

In the mid-1990s, however, new business models emerged that enabled data to be collected and correlated across nonaffiliated websites, giving advertisers the ability to optimize their campaigns and to understand how users interact with them. This data—bits of information left behind by consumers navigating the web, often referred to as “clickstream data”—also enabled advertisers to target their campaigns to
people who were most likely to be interested in them—whether that meant sports enthusiasts, men living in Los Angeles that fell into a certain age range, or people in the market for a new car. This “network advertising” also allowed publishers to earn greater revenues from the ads served on their sites because users were more likely to act on them. Click here to read the full article.