Ad Placement refers to a space on a website or blog that is allocated for advertisements. Publishers place ads on their websites and blogs in order to generate revenue from the traffic that they refer as well as to compliment their website's content.
With most programs a publisher can choose the format and presentation of the ads in order to match their website's style and layout. Generally publishers can select such parameters as advertisement format (Banner, Skyscraper, Square, etc.) as well as fonts and colors. The actual content (image or text) within the ad placement however, is determined by an ad-serving algorithm. Its primary purpose is to make sure that the ad's content matches and/or compliments the content of the website. This ensures maximum click through and conversion rates, thus generating higher revenue stream for publishers and effective return on investment for advertisers.