"I know that 50% of my advertising is wasted. I just don't know which half," retail guru John Wanamaker said in 1886. If he were alive today, and was selling on the Internet, then he would know exactly which 50% of his advertising was performing - in fact, he would have had enough data to ensure that his ad spend was never wasted.

Search engine based advertising has brought about a profound change in the way marketers reach out to their audience. Marketing was all about determining the right demographic and finding the appropriate vehicle to reach out to them. Hence cosmetics were advertised during the "Oprah Show" and beer during the "Man Show." Keyword based search engine marketing turns the tables and brings the buyer to the seller - irrespective of demographic.

An additional dimension in the online world is the ability to understand the behavioral characteristics of the user based on her searching and browsing behavior and incorporate that into focused and targeted advertising, one-on-one. Here is a primer on the two important new ways of online advertising - contextual and behavioral advertising - Behavioral & Contextual Targeting: A Primer.

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