Demographic buying has also been effective online thus far and is similarly based on successful offline buying models. The main benefit of demographic targeting is that is allows you to reach people who are similar to your consumers and who may like your product even if they have not yet shown an interest (we call this prospecting).

When ads are shown outside of context, they also have the benefit of not having to compete for attention with competitor's ads. The major downside to this type of planning is that it can miss people who don't fit the profile and waste dollars on those who have no interest. Let's see how this works in our example.

There are 44.6 million people online who visit gaming information websites. There are 115 million households, according to the last census. Sixty-nine percent would be 79 million game playing heads of household. That means that if half the people who visited a gaming information website were a head of household, and you could reach all the people who visited gaming information websites, you'd still only reach 28 percent of game playing heads of household. While this isn't an exact science, it does show us that relying only on contextual placements won't get us all the reach needed against our audience.

Our video game maker knows that many of the people who have bought games in the past have been 18-34-year-olds. There are 51.3 million people online in the 18-34 demographic. If you want to reach as many of them as possible, and even if you run ads with a company that has the highest reach of any ad-supported entity, it's still likely that with a pure mass reach buy only about one in three of your ads will actually be shown to someone who is 18-34, unless you add additional targeting.

You could also run on sites that have a high composition of unique users who are in your target demographic, such as Rediff.com, the outdoor network, or Self.com. But none of these sites has an audience larger than 2 million. Even if you bought every site with an audience composed of at least 60 percent or more of your target of 18-34-year-olds, you'd still only reach 5 million people or a tenth of your 18-34-year-olds. That's a nice addition to your contextual buy, but it's not going to sell enough games for you as a technique alone. Interestingly, none of the top contextual sites overlaps with the top demographic sites. That leads us to believe the target is more complex than either of these methods alone.