@Rosemary16 It works the same way as an ad in a newspaper or on TV. Companies contact the newspaper/station and buy a section of the printing/airing for the ad at an established price. In this case, companies contact AG and buy an ad slot on the screen.
It is completely logical that there are advertisments on AG and I don't have any problems with it but I could think now: 'ey, that site (in the advertisment) is a lot cooler than AG.' And than you loses AG a member.
Armor Games must be doing something right. This site has over a million users and gains several thousand each day. Most of the advertisements are just online/browser games. If a person leaves a free flash gaming and forums site because of one single game, then let them. I, and I'm sure many others would rather be on Armor Games.
I wonder how the ads give AG revenue to keep things free
The companies pay armorgames to put the ads there and I'm not 100% sure, but I think they pay them for how many people see them. The more people, the more money.
There are several different kinds of ways to get paid by ads.
CPM is "cost per mille", which is how much we'd get paid if 1,000 users saw that ad.
CPC is "cost per click", which is how much we'd get paid if a single user clicks on an ad.
CPA is "cost per acquisition", which is how much we get paid if a user clicks on an ad and fills out a form or buys something, etc., at that advertiser's web site.
Obviously CPA's pay the most, but I don't think we've ever done those. CPC's pay decently well, but the average click-through-rate (CTR) on online ads is generally less than 1%, so the most common kind of ad is a CPM ad, where we simply get paid based on the number of "impressions" we show to users.
Then there are "site skins" which are special deals we do with companies who want to pay us a big chunk of money to show a huge promotion, like Disney did recently with their "Kickin' It" show, or the Priest Movie game where we sponsor a game and site skin.
And we also make money on selling iPhone/iPod/Android games, etc.
