From Wikipedia:

Banner blindness is a phenomenon in web usability where visitors to a website consciously or subconsciously ignore banner-like information, which can also be called ad blindness.

The term “banner blindness” was coined by Benway and Lane as a result of website usability tests where a majority of the test subjects either consciously or unconsciously ignored information that was presented in banners. Subjects were given tasks to search information on a website. The information that was overlooked included both external advertisement banners and internal navigational banners, e.g. quick links. The placement of the banners on a web page had little effect on whether or not the subjects noticed them. The result of the study contradicted the popular web design guideline that larger, colourful and animated elements on a website are more likely to be seen by users.

However, in an experiment by Bayles the results showed that users generally noticed web banners. This was proven by eye-tracking tests and other means. The experiment concentrated on how users perceived a single web page and what they could recognise and recall of it afterwards. It has been argued that experiments like this without real-world tasks have poor methodology, and produce poor results.

Pagendarm and Schaumburg  argued that a possible explanation for the banner blindness phenomenon lay in the way users interacted with websites. Users tend to either search for specific information or aimlessly browse from one page to the next. Users have constructed web related cognitive schemata for different tasks on the web. This hypothesis was also suggested by Norman. When searching for specific information on a website, users focus only on the parts of the page where they assume the relevant information will be, small text and hyperlinks. Large colourful or animated banners and other graphics are in this case ignored. Usability tests that compared the perception of banners between groups of subjects searching for specific information and subjects aimlessly browsing seem to support this theory