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The Origin of The Internet's Original Banner Ad

By Wesley Fenlon

Web magazine Hotwired and AT&T proved the viability of web advertising with the first banner ad in 1994.

In an Adblocked world, the Internet banner ad doesn't carry the advertising weight it once did. But it's also come a long way from its origins in 1994, which Digiday highlighted in a blog post on Friday titled "How the Banner Ad Was Born." The life of the banner ad stretches back to four years before Google existed and begins with Hotwired, a webzine spin-off of Wired magazine. As Digiday tells it, Hotwired needed to come up with a way to pay its writers. They coined the term banner ad.

"The idea arrived to create a dozen sections that would carry “banner” advertising," writes Digiday. "This wasn’t entirely original. Early Web service Prodigy had used similar methods, although it placed its banners at the bottom of the screen. (This led to the first ad blocker; a piece of plastic affixed to the bottom of monitors to obscure the dreaded advertising.) The ad was small and unobtrusive by necessity. 'We were designing for a 13-inch black and white screen,' said Hotwired’s CEO at the time, Andrew Anker. 'It was state of the art at the time.'

Photo credit: Flickr user SamahR via Creative Commons.

AT&T ended up becoming the first company to buy a banner ad on Hotwired. It cost the company $30,000 for three months. When the ad launched in October of 1994, it pulled in a 44 percent click-through rate, which is absolutely insane. Today's banner ad click-through rate has been holding steady at about 0.09 percent since 2008.

There were a lot of intersting firsts about AT&T's banner. Digiday describes how its creators had to fight for the idea of web advertising, which was uncharted water at the time. And the ad was only vaguely self-promotional. The advertisers shrewdly recognized that the Internet was, at that time, mostly the domain of artists and other creatives, so they didn't direclty attempt to sell AT&T services through the banner.

The banner led to a "a webpage that collected the early sites of great museums of the world," which was created by the advertisers. "AT&T would enable people to tour the great works of The Louvre, the Warhol Museum and others. The brand would be, as [interactive ad agency] Modem founder GM O’Connell preached, a service."

When the ad went up, it was hard-coded into the Hotwired page. There were no servers dedicated to delivering ads. The depth and breadth of today's analytical tools throw into relief just how basic that first ad was.

"Measuring how many ads were shown was a manual process," writes Digiday. "John Nardone, who joined Modem to lead its media department at the time, recalls getting log files from publishers in order to count the “hits” an ad got. Log files included hits for each piece of the page’s content; that meant combing through for the .jpg file associated with the ad. The first Web analytics tool was a highlighter pen."