You’ll never believe why people click on those terrible website ads

This is just one of the stories from our “I’ve Always Wondered” series, where we tackle all of your questions about the world of business, no matter how big or small. Ever wondered if recycling is worth it? Or how store brands stack up against name brands? Check out more from the series here.

Ali C. asks:

I've wondered why even the most legitimate websites are littered with those crappy ads on the bottom. How do those websites that advertise at the bottom of articles with photo galleries make money? The ones that say stuff like "People you never knew were in Harry Potter" or "Horribly aged celebrities." Do people actually click on those?

Many people do click on those ads, and the reason may shock you.

You’re probably familiar with these sensationalistic ads at the bottom of web pages — they might show you “shocking” before-and-after photos of celebrities, shill weight loss remedies, or feature grotesque imagery of various skin ailments.

These ads are actually supposed to be low quality and they’re designed to pique the reader’s interest, said Stacy Jones, CEO of the marketing agency Hollywood Branded.

“When people see it, they don't instantly think in their head, ‘Oh, that's an ad.’ Instead, it causes them to have curiosity,” Jones said.

The ads might make claims, “Look at the before and after. Her face literally was falling off, and now she looks like she's 19 years old,” Jones said. These are the same elements that have made outlets like the National Enquirer popular, Jones pointed out.

These ads target universal triggers like fear, presenting you with health hacks, or greed, claiming that they can offer you secrets on how to get rich quickly, said Garrett Johnson, a marketing professor at Boston University.

“These are pretty effective,” Johnson said.

Taboola and Outbrain are the primary companies that have been behind these types of ad placements. While the two announced a merger back in 2019, it was called off in 2020. However, Outbrain acquired the company Teads last year, calling the merged company Teads Holding Co.

The business model behind these ads

It doesn’t take a lot of clicks for an ad to be considered successful. Most click-through rates are low, and if you have a click-through rate of 2%, that’s considered “solid,” Jones said. These types of ads have a click-through rate of about 0.5% to 2%, although it could be higher, Jones said.

So if you’re putting ads in front of tens of millions of people, and just 2% of users click on these ads, that’ll generate a significant amount of money, Jones said.

Every time someone clicks an ad, that might pay out about 5 to 30 cents to the publisher, Jones said. “This makes up a good base for a lot of publishers. This is going to be somewhere between 10% to 30% of their revenue,” Jones said.

And the company behind that ad makes money when the user who clicks on it ends up buying something, like a skincare product, Jones said.

You might click on a page expecting to learn more about a celebrity’s transformation, only to end up in a sea of endless ads.

“When you click into that article, you have more ads being advertised. It is giving you another place to go to find more brands that are trying to get your money,” Jones said.

Even people who think they’re immune to advertising can end up on these pages.

“I think that as humans, we're not even necessarily aware of where we click sometimes,” Jones said. “If you actually start being more an observer of what you're clicking online, you are going to be surprised about how much of it is actually advertising packaged in different ways.”