I know I can place ads on Google with Adwords, target ads to individuals' interests on Facebook, use an ad network that distributes my ad broadly, or even buy ads on specific individual sites.
Clearly, there are many places I can potentially waste my ad dollar budget. If I take a shotgun approach, I'm sure my money will end up somewhere, but I'm not sure if users will end up at my site!
So my question is: How can I learn about effective online advertising? Pointers to specific books, articles, videos, etc. including summary of key takeaways would be very helpful answers. Thank you!
The answer to your question is simple: start advertising. There are a bajillion places to advertise on the Internet, and none of them are better than another. If you want to advertise a software tool for developers, Stack Overflow is probably a good fit. If you want to advertise smiley icons that install spyware on user's computer, then you may want to consider MySpace.
Once you identify a few places that are probably a good fit and might work, then shoot your shotgun at them. There's simply no other way of knowing which audience will be right for your product until you try it. The secret is to spend as little as it takes to find effective data. Once you find the short list of effective sites, then throw more money at them until they stop working. If nothing works (and your list of sites has other advertisers), then the problem is not them, but you. Maybe its the message, or maybe its the banners.
Whatever route you go, consider the following:
Keeping these in mind, you can avoid a lot of mistakes such as having your company logo be big and prominent.
Alex is right that you just have to try things. I've found that I cannot predict whether a particular site or ad will be good or bad.
One thing for sure: You have to be able to measure the effectiveness of the ad. Otherwise you're just spraying money and praying it works.