What is contextual targeting in advertising?

contextual targeting

What is contextual targeting?

In advertising, contextual targeting is the practice of placing an advertisement in an environment occupied by content that is relevant to the content of the ad. The content on a webpage informs the process, providing context as to the reason the ad is being shown to the targeted user. Through automation, ads are displayed on a website or among video content based on recognition of keywords and topics.

For example, a user browsing on a site like ESPN.com might be presented with a display ad for baseball cleats. This ad for a sports product is contextually relevant to the content of a website about sports.

How does contextual targeting work?

Contextual targeting hinges on the theory that a user may be more likely to take interest in an ad that is related to or directly about a subject that the user is already interested in. They’ve proven their interest in the subject of the webpage’s content by visiting the page. Presenting this user with an ad for a relevant product, service or company is therefore likely to pique their interest as well.

Consider the example of listening to multiple music artists whose songs are each categorized into a common genre. When you listen to a certain style of music, you may be more apt to wade through a list of related artists to find new songs that sound familiar.

Contextual advertising offers that exploratory experience to users on a website, asking them to peel back the next page of content that seemingly fits right in alongside what they had already shown up for. Though it’s an advertisement, its relevance — the context in which they are seeing it — makes it worth engaging.

Contextual targeting platforms assess the content on a page, finding keywords, contextual categories, tags and more. Google AdSense is one example, but there are plenty of platforms out there which are often industry-specific and offer a deeper focus on context within those industries. In practice, this automated process delivers this contextual data to the ad networks, or SSPs, that in turn provide it to media buying platforms to display contextual ads.

Are keywords and context the same?

Keywords and context are related, but not entirely the same when it comes to targeted advertising. Contextual ads are targeted based on context, which considers both keyword and topic analysis. Contextual categories cover the topics that a webpage’s content includes, like sports, home goods or fashion. Contextual keywords help match targeted ads to the keywords that can be found on the page, like an ad for reusable water bottles being shown on a page where “water bottle” is a present keyword.

What is behavioral targeting and how is it different from contextual targeting?

Contextual and behavioral targeting are different methods of reaching an audience target based on different sets of data that inform the targeting strategy.

Behavioral targeting selects a target user by analyzing their previous behavior online — such as websites they have browsed, searches they have performed and other digital content they have engaged with — to match an ad with that user’s behavior. For example, a user who has been searching for shaving kits may be served display ads for shaving kits.

Behavioral advertising differs from contextual advertising in its disregard for the environment in which these ads show up to the user. That is how ads are targeted contextually, by being shown on a webpage where relevant ads are deemed relevant based on the content of the webpage matching the content of the ad. If an ad is targeted to a user based on their behavior, it could show up anywhere the user might be browsing.

Returning to the previous example: An ad for shaving kits being served to a user who has been searching for shaving kits might show up on ESPN.com, where the central theme of sports and all related topics and keywords would typically have nothing to do with shaving kits or beauty products.

This explains how behavioral advertising is more dependent on a user’s personal information, like their browsing history. This method of targeted advertising has historically relied on third-party data captured by cookies, which are being phased out by all major search engines. Moving forward, targeted advertising will need to be informed by other data sources like first-party data.

Why is contextual advertising important?

The benefits of contextual advertising are becoming clearer as the cookieless world approaches.

  1. Contextual advertising eliminates the need for third-party data and quells privacy concerns by maintaining focus on the content of a website rather than the personal information of a user and their online activities.
  2. Using context as a methodology for targeted advertising is also beneficial to engagement due to its inherent relevancy of content. Instead of educated guesses at what sort of ads might resonate with a user based on their behavior or personal data, context simply allows for ads to leverage the interest a user has shown in a topic and apply that potential interest to an ad within the same realm.
  3. Avoiding the need to juggle privacy regulations and secure premium user data, contextual targeting helps cut down the cost of ad campaigns. It also makes establishing a campaign strategy simpler, because audience segmentation is less specific.
  4. Brand safety is more easy to confirm with contextual targeting, because brands don’t need to worry about their ads showing up on potentially harmful or offensive sites based on a user’s behavior. The ads will only show up where they are contextually relevant.

What are the benchmarks of contextual targeting?

Contextual ads have been shown to perform better in average CTR than the industry average for behaviorally targeted ads by around .05% according to an eMarketer report. As contextual targeting becomes used more often in the coming years, more research is expected to examine the potential advantages and disadvantages of this method over behavioral targeting. The current consensus, though, is that a more interested audience likely lends more conversions and surface-level engagements like clicks at the very least.

Where does contextual advertising shine?

Certain industries with strict privacy standards, like healthcare, may favor contextual targeting as a method for audience targeting because of its benefits to brand safety and privacy regulation conformity. However, contextual targeting is a valuable option for any brand.

How does programmatic benefit contextual targeting?

All major real-time bidding exchanges that use the power of programmatic to scale ad campaigns allow for contextual targeting as a method of audience targeting. This means that brands can target very large audience segments at once simply by reaching them beside the relevant content they are already browsing.

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