Log onto Circuit City’s Web page and the first thing you see isn’t the Web page. A large advertisement pops into view from nowhere touting "Special Offers From Circuit City," such as $1.99 off shipping on your DVD orders and free shipping on all CDs.

The Richmond-based retailer’s Internet ad is one example of how Web advertisers are bucking a sour environment, according to Mitchell Caplan, president of Martin Interactive, part of the Martin Agency based in Richmond. Circuit City hits its Net ad audience at the right moment when people are trying to get information about the firm. They aren’t annoyed by slow-to-load ads or ones that stall your ability to get your e-mail, Caplan says.

Overall, however, Net ads are taking their lumps. They have yet to reach their market potential predicted five years ago. This year, Net ads in the U.S. will increase only 6 percent to $5.7 billion — down from the forecasted $7.3 billion, reports Jupiter Media Metrix Inc. They now represent only 3 percent of overall advertising.

"Internet advertising business has been its own worst enemy," Caplan says. "We have arguably done a pretty bad job of telling our clients what the value of the Net ads could and should be." Advertisers need to be more considerate of their viewers’ time and not annoy them at inopportune moments.

The biggest problem is continually slow modem connection speed. Most computer users still are stuck at 56 kilobytes per second or even slower. The promised high-speed broadband that should be a big boon to Net ads hasn’t really hit the market and won’t for about four more years.

One solution, Caplan says, is to tailor ads to viewers’ connection speeds. If an advertiser, for example, is trying to reach people as they place orders on United Parcel Service, they might use higher-speed ads since many clients already are on high-speed T1 telephone lines. By contrast, customers of agricultural firm FMC Corp. need slower ads because they tend to be farmers with slower modems.

For now Circuit City has been rethinking its Net ad strategy. "We’re doing some new experiments," says Jim Babb, Circuit City’s director of media relations. " We will still have a presence in Internet advertising."