How do you know you can trust the person who wants to buy a banner ad from you? Should I put the ad on my website first, and then trust that the advertiser will follow-through and pay me? Or, does the advertiser pay the publisher first (and then trust that the publisher will follow-through)? What is standard? I decided to trust the person who emailed me, and I went ahead and put the banner ad onto my site. It has been 14 hours, and I have not received payment or heard back from this person. So, I feel that this individual cannot be trusted, and I have removed his ad. Was I wrong to place the ad on my website before receiving payment? Either way, it seems that one party must take all the risk, and trust that the other party will follow-through.
This is where the community comes in. If the person you dealt with is part of a common community forum where you are also a member, you can sort out the issue there. For example, here in DP, you can use the Buy and Sell forum for all your trading needs. Also each member is assigned an iTrader rating showing how many successful transactions he has been part of. Next, if you do have to take the risk, the seller should take it since most of the time, you are trying to sell the ad inventory.. the buyer has thousand other sites to buy from. What you did was correct.. wait for some time for the payment, send a reminder or two, if the person does not respond remove the ad. But if yours is a large site with a waiting list for potential advertisers you can take the payment in advance. It all depends on who has more need for the ads - the buyer or seller.
As it turned out, he was waiting on funds from his business partner. Payment was sent via Paypal, and his ad was placed back on my website. So, it all turned out well, and he was trustworthy. Thanks for your advice iwm1979.
It would all depend on how much the ad spot is worth. If it is expensive you may feel you are losing out on potential revenue if the buyer backs out. But if there are no other advertisers waiting in the queue, you may as well leave the ads for a few days - you have nothing to lose.