The Complete Guide to Contextual Targeting: How it Works and Why It is The Solution for a Cookie-less Marketing

The Complete Guide to Contextual Targeting: How it Works and Why It is The Solution for a Cookie-less Marketing

Every marketer wants to produce ads that will reach the right customer at the right time. Contextual targeting has been making waves as the solution for achieving just that.

So, what is contextual targeting?

In this post, we’ll cover essential details of contextual targeting, from what it is to why it is important. Additionally, we feature best practices and the top platforms you can use.

What Is Contextual Targeting in Advertising?

Contextual targeting is a targeted and automated form of digital advertising. It allows advertisers to display ads that are relevant to the website’s content instead of using visitors’ data.

The idea has been around quite some time, for example, the half-page baby carrier ads next to an article about newborns in a parenting magazine. Contextual ads for digital advertising work similarly by targeting the content on the site instead of the user’s data.

In the decades before digital advertising, editors and designers spent a lot of time assembling and curating the ads to go with the content. Today, this process is entirely automated.

Since the early days of the internet, advertising technologies have enabled advertisers to segment and target their audiences according to their behavior and interests. These days, with privacy regulations becoming more strict, contextual targeting is gaining popularity because it relies on context, and not on personal data.

Types of targeting

Understanding contextual targeting is helpful if we compare it with other methods. There are many types of ad targeting for ad campaigns. Let’s review the five most popular practices of targeting.

  • Behavioral targeting

An example of behavioral targeting is retargeting ads. This practice segments customers based on their browsing behavior. The segmentation may include the pages the user visited, the searches they performed, what links they clicked on, and which products they purchased. Some platforms also consider location and in-store purchases—the system groups visitors with similar behaviors into audience segments. An example of behavioral targeting is retargeting ads.

  • Contextual targeting

This method involves displaying ads based on a website’s content. For example, you are placing an ad for running shoes on a forum for runners. Contextual targeting works by assuming someone visiting a site about running will probably be interested in buying other types of utility shoes.

Contextual targeting

  • Search retargeting

Search retargeting comprises serving to display ads to users when browsing the web, according to their keyword search behavior. When you set up a search ads campaign, you choose the keywords that apply to your business or products. For example, a company selling women’s shoes serves ads to searchers looking for “women’s boots” or “black heel evening shoes.”

  • Site retargeting

The most common form of retargeting consists of showing ads to users that visited your website but left without completing a purchase or taking action that was interested in your content. Because it targets brand recognition, this method can bring a high ROI by targeting the bottom part of the funnel.

  • Predictive targeting

Predictive targeting uses data collected by behavioral targeting, adds a bit of 3rd party data into the mix, and analyzes and predicts buying patterns with the help of artificial intelligence and machine learning. The artificial intelligence feature can detect behavior patterns, identify products to upsell and cross-sell, and target which shoppers are most likely to convert.

How Does Contextual Targeting Work?

Automation gives contextual targeting the efficiency it needs to address digital advertising. Let’s check how it works:

Contextual targeting solutions use a web crawler to scan the website URLs and categorize the content. The goal of this is to understand the site and how it may respond to visitor queries. When a user visits a website page, the information collected by the crawler is passed in the request to the ad server. The ad server matches relevant campaigns to the topic categories, keywords, and more.

Unlike behavioral targeting, in contextual targeting, the publisher’s ad server fetches page-level data, querying the URL and placement IDs, and passes it to AdTech platforms. These platforms then select suitable ads that match the context of the page. Since users get to the page driven by their answers, contextual ads enhance their experience.

What is keyword contextual targeting?

Ad networks such as the Google Display Network use keyword-contextual targeting to match keyword-targeted ads to sites. This form of contextual targeting is better for advertisers looking for performance.

The platform serves the ads according to keywords previously set by you on your campaign setup. When the user searches for topics related to those keywords, they get ads relevant to them.

You can learn more information about how this works for Google Display Network here.

Which Platforms of Contextual Targeting Are There?

Contextual advertising is available from well-known advertising platforms and ad networks. Here are a few examples:

CodeFuel

Optimize monetization efforts with CodeFuel

This complete monetization platform uses contextual targeting to deliver highly relevant ads to high-intent users.

Key features

  • Uses an intent-based search to monetize digital properties such as apps, extensions, and websites.
  • Provides search mediation via optimized landing pages for media campaigns.
  • Supports multiple media buys such as Facebook, Google, Taboola, and Outbrain).
  • Presents shopping ads with high relevance to drive high-intent users into conversion.
  • Leverages search ads with customized search results pages.

Pros

  • Flexibility
  • Centralized dashboard
  • All-in-one solution
  • Multiple integrations.

Cons

  • Requires a mid-sized audience to find high-intent users.

Google Adsense

Google Adsense and Google Doubleclick Ad Exchange

This popular platform offers an extensive reach, serving ads based on searches and keywords. Google Ads allows publishers to monetize websites by presenting ads related to keyword searches.

Key features

  • Analyzes your website and places ads based on the layout, content, and if you already have other Google ads.
  • Automatically adapts the size of the ad to the user’s screen.

Pros

  • Simple to use: you just need a Google Account and website
  • Easy to use: you add the same line of code to each page you want to show ads.
  • Responsive: adapts the ads automatically to mobile.

Cons

  • Too wide a reach
  • Restricts working with other ad networks.  Use CodeFuel to access the premium Google ad network.

3 Examples of Contextual Advertising

Contextual targeting is a very clever way of targeting viewers because it is tied to their interests. Let’s review some examples, so you have a clearer idea of how this works:

1. Ads about Dutch Ovens inside an article about Dutch Ovens

Epicurious is a well-known site for amateur cooks and features product reviews and comparisons regularly. This article was geared to inform the consumer how to choose a Dutch Oven. The piece features ads at the bottom with several options from well-known brands. The reader can buy with a quick link to the ad.

Contextual Advertising Example I

Source: Epicurious

2. Swimsuit ads besides workout and fitness content

Contextual Advertising Example II

Source: Fitness Blender

What isn’t clever about adding swimsuit ads on a fitness website?. While the consumers choose which workout to do, they can choose a swimsuit to go with their new fit body.

  • Makeup ads when looking for makeup tutorials

Contextual Advertising Example III

When you search for a topic on YouTube, the platform presents you with a dynamic lineup, which offers ads to customers watching videos. It helps brands scale up by serving ads that enhance what they are viewing.

Difference Between Contextual and Behavioral Targeting

Until now, many marketers were comfortable relying on techniques like behavioral targeting. But with the phasing out of third-party cookies by 2022, marketers are looking for new ways of reaching their target audience.

Both contextual and behavioral targeting have the same goal: ensuring that the right ad is placed in front of the user who is most likely to purchase. The issue with behavioral targeting is that technique is based on past consumer behavior to predict future actions. On the other side, contextual targeting targets campaigns by placing ads on the website the buyer may end.

Contextual Targeting Pros and Cons

Now that we know more about contextual targeting, let’s explore the pros and cons. While it is more effective than other targeting methods, it has its challenges. Here is a summary of its benefits and challenges.

The pros of contextual targeting

  • Keeps you compliant with regulations. Because it relies very little on personal data, contextual targeting helps align with regulations like GDPR with ease. Moreover, if you don’t collect personal data but only information about the website, then the targeting is outside the terms of the GDPR, and regulation doesn’t apply.
  • Complement content. When done right, contextual ads enhance the user experience by adding timely information to the content. Some studies show contextual targeting may increase purchase intent by 63%.
  • Are based in the interest of the user.  For example, contextual ads in review sites increase the chance of getting clicked.

The cons of contextual targeting

  • It requires attention. When setting up your ad campaign, you need to be careful, so the context is not too broad.
  • There can be problems with frequency capping. Limiting how frequently a visitor to a website is shown a particular ad.

Why Is Contextual Targeting Now Popular Again?

You can use several methods to target your audience. Methods like personalized advertising or retargeting rely strongly on user data. Because of new regulations like GDPR, it is going to be difficult for advertisers. Both advertisers and publishers need to get consent from users to collect their data for targeting, which can be tricky.

Also, with third-party cookies disappearing in 2022, there is a bigger understanding of how contextual ad targeting can help without creating issues with data protection.

How does Contextual Targeting work in Social Media

Social media channels are full of ads, and it seems that the more businesses compete for attention, the more users filter out ads. That’s why context is so essential to create a better brand effect.

Social media contextual advertising is a model where users are targeted according to their browsing behavior. Ad networks extract content from social media websites and use artificial intelligence to analyze the audience and display relevant advertisements.

Social contextual marketing is growing thanks to the popularity of mobile social networks. The monetization of mobile social networks like Instagram is becoming a trend followed by other networks. Chat applications like Whatsapp and Facebook Messenger are not yet monetized. We Chat is the only application monetized so far.

Why is contextual targeting effective for social media? Because in social media, users naturally self-segment to participate on the platforms. That makes contextual advertising even more effective in reaching customers. The ever-increasing numbers of social media users are reason enough to start applying contextual targeting in your social media channels.

Best Practices for Digital Marketers

The goal of contextual targeting is to deliver highly personalized ads to users. The personalization factor of this marketing strategy is what makes contextual targeting so effective.

So, if you are looking to start with contextual targeting, look no further. Here are four best practices you can start implementing now.

1. The more you segment, the better

Create separate ad groups for each ad placed. That way, you can personalize the ads, targeting more people. Analyze your audience data so you can understand your target audience, segmenting them into smaller defined groups.

2. Use an array of ad types.

When you use various ad types for your contextual targeting campaign, you have more chances to deliver the right message to the user. Use a mix of video, native and behavioral ads for optimal results.

  • Video ads: one of the best ways to engage your audience. When combined with contextual targeting, video ads are a powerful tool. If a YouTube user clicks on a video about applying makeup, they may receive an ad for makeup brands on that page or video.
  • Native ads: these are the most popular type of ads present on contextual targeting. Native ads are designed, so they look like part of the page. They seem more relatable and increase the engagement of the user with your campaign.
  • Behavioral ads: behavioral ads are tailored to a specific user based on their interests and online behaviors. Combining behavioral ads with contextual targeting helps you reach the right user with the right message at the right time.

3. Include a call to action

Make sure the user that sees the ad knows what action they should take. For instance,” shop now,” “click to learn more,” and so on. When the user can identify what is the next step when viewing the ad, they are more likely to take that action. Conversions are more likely when the ad copy relates closely to what they are looking to purchase.

4. Build an effective landing page

Relevance is the name of the game when it comes to contextual targeting. If you want to keep your campaign relevant, each ad should have its landing page. A unique landing page helps your users engage with your brand and encourage them to take action.

How Effective is Contextual Targeting?

According to a study, a lot. The research, conducted by neuro analytics company SPARK Neuro, aims to demonstrate how modern contextual advertising, with its components of machine learning and natural language processing (NLP), is a highly effective method for ad targeting.

The study showed users ads with different contextual relevance and measured their neuro activity, and looked on the page when reading the content. They found the contextually relevant ads generated 43% more engagement and two times more ad recall. 

Another study that appeared in the International Journal of Advertising says that

“The results demonstrate that the internet contextual advertising enhances brand recognition and induces favorable attitudes towards the ad. (Are contextual advertisements effective?, IJA

Contextual Targeting Statistics

  • The phasing out of third-party cookies is a crucial challenge for US digital media professionals.

Contextual Targeting Statistics

Source: emarketer

  • 49% of US marketers surveyed are using contextual marketing today.
    • In the UK, 32% of marketers use contextual marketing, while 36% use demographic targeting.
  • 44% of marketing execs rated the contextual value.
  • 31% of brands surveyed said they plan to increase their spending on contextual ads in 2022.

Source

Why Contextual Targeting is the best solution for a Cookie-less Ad Market

Using contextual targeting with digital advertising (especially with display advertising) has several advantages;

1. It is highly relevant

Contextual targeting means that the person viewing your ads will be more interested in them because of the context of the page they are visiting. However, when ad creatives are not relevant, users can get tired. Advertisers then need to enhance the user experience with more relevant ads.

2. Prevents ad fatigue

An ad close to the right content can enhance the content and prevent getting tired of ads. The user doesn’t see them as sales but as helpful.

3. Privacy regulations friendly

Contextual targeting doesn’t interfere with user behavior; it is only about the page where the ad is placed. They don’t collect data on the viewer. Contextual targeting only uses the information on the content of the webpage.

Future Trends of Contextual Advertising

Contextual advertising may be around for a long time but is by no means static. Here are the  top trends about contextual advertising that can help you stay informed:

1. Advances in relevance software

Developers wanting to improve the relevance of targeted ads just need to insert a JavaScript code into the webpage.

2. In-text video contextual advertising

New technologies allow placing in-video text advertisements on YouTube. Video-on-video ads are possible as well, with platforms working similarly to AdSense. They scan the video for content and propose advertising based on the content.

3. In-game contextual ads. 

Developers tried with various degrees of success to insert contextual advertising in video games. When they would appear in the middle of a game it was very annoying for gamers. Inserting the ads before or after the games is more effective and less disruptive. Still, app developers need to monetize their applications. Therefore, developers are trying different ways to integrate contextual advertising without interfering with the user experience. For example, the game AdRacer, created by the University of Luxemburg presents ads on roadside virtual “billboards” as the player is driving.

FAQ’s About Contextual Targeting

How will contextual targeting look when cookies are phased out?

It has been argued that contextual targeting is the next step in digital advertising, answering the end of third-party cookies. Marketers will focus again on context marketing, which puts contextual targeting as an ideal approach. Leveraging context to deliver highly targeted advertisements can impulse contextual targeting to new popularity.

How can publishers maintain control of contextual advertising?

In a way, contextual advertising provides a lot of control for publishers. Publishers can tap on their high-quality content to monetize it accordingly. By leveraging an ad network or monetization platform that focuses on contextual advertising, publishers can regain value. By using contextual targeting, publishers enhance the user experience, better align ads to the page and increase engagement.

How do you build a contextually targeted campaign in Google Ads?

Google Ads uses contextual targeting to match keyword-targeted ads to sites in the Google Display Network. If you want to build a contextually targeted campaign in Google Ads here are a few pointers:

1. Define a specific theme for your ad group: each ad group should have its theme. Start with the theme that describes the product or service, and include branded keywords.

2. Be sure to include enough and relevant keywords: you can add between 5 and 50 keywords but be careful not to repeat keywords in the same ad group. Keep keywords relevant to the ad group theme.

3. Set the bids: the Display Network bid should be at the same level as your search bid.

4. Be efficient with negative keywords: this will prevent your ad from appearing on irrelevant sites, saving you money.

How CodeFuel uses Contextual Targeting to Increase Conversions

When contextual targeting is done right, it enables brands to reach their audiences in the right environment at the right time. CodeFuel solution offers contextual targeting capabilities that go beyond keyword or URL-based targeting. By leveraging AI, CodeFuel delivers high yields for publishers with an intent-based journey. It is easy to deploy, use and analyze results.

CodeFuel is a complete monetization platform geared to maximize publisher’s yield by delivering the highest relevance based on intent and advanced analytics. Start monetizing your digital property today. Sign up now.

What Is Contextual Advertising in 2021? The Ultimate Guide for a Cookie-Less Landscape

What Is Contextual Advertising in 2021? The Ultimate Guide for a Cookie-Less Landscape

Contextual targeting is the new frontier of advertising. Contextual advertising means targeting ads to people based on what they are reading on a website. With the latest regulations and concerns about behavioral tracking online (for example with third-party cookies), there is a huge demand for personalized marketing strategies, hence, contextual advertising. With the advances in artificial intelligence and machine learning, you can now learn what customers are looking at on a publisher’s page. In this guide, we review the ins and outs of contextual advertising.

Contextual Advertising (Infographic) What Should Publishers Know?

Contextual targeting

How Does Contextual Advertising Work in CodeFuel?

At CodeFuel, we bring the power of context to maximize the impact of campaigns and publisher’s yield by delivering intent-based ads to high-intent customers. 

Our Intent Discovery Platform (IDP) generates dynamic contextual ads that allow serving the right ads at the right time on every site. 

Some benefits of CodeFuel’s contextual advertising: 

Publishers get more revenues by accessing millions of ads. 

  1. Visitors enjoy an enhanced user experience by discovering ads related to the content they are reading. 
  2. The relevance of the ads to the topics presented on the page increases the likelihood of conversion. 

Provides an infinite search demand

CodeFuel gives publishers access to a wide demand of advertisers in an array of verticals. The IDP optimization layer enables the ads best suited for the audience. 

readreview-ads-technology

Leverages Artificial Intelligence 

The machine learning process generates the perfect ad unit that at the same time offers publishers high yield, and offers a great experience for users. 

Use cases

  • A user visiting a cooking blog and reading a recipe can get ads related to the ingredients or cooking ware.
  • A person looking at the best winter hikes recommendation article will get ads related to hiking boots and gear.

Contextual advertising involves targeting ads through an ad server that places the advertiser’s ad on pages that meet the desired criteria. There are a few steps on this process: 

1. Contextual Targeting is built around keywords

The platform needs to know what the campaign is about before placing the ads on relevant web pages. To do that, the system relies on the keywords associated with the webpage. If the topics the advertiser chose match the theme of the website, the ad can show on the site. For example, an advertiser can select vacation rentals, then use related keywords like beachfront, number of rooms, location, and other subtopics.  

At CodeFuel we add a new layer of relevance by matching visitor intent as a factor for displaying the relevant ads on the page. 

2. Contextual Advertising and First-Party Data

As the timeline for third-party cookie phase-out in Chrome is approaching, organizations are searching for cookie-less solutions that are equally effective as current methods. 

Any approach that wants to be effective in the near future needs to tap into first-party data to understand customers. Publishers, for example, need to strengthen their first-party data collection in order to sustain their revenue. This means ensuring the maximum number of their audience have opted-in to receive targeted ads, so they can leverage the ad inventory while keeping privacy compliance. 

CodeFuel’s Intent Discovery Platform enables publishers to get new revenues and optimize ad campaigns.
Start monetizing today

The Types of Contextual Advertising

Contextual ads can take many shapes. They can be text ads, banner-like ad units, or videos. 

Contextual text ads

These are the ads you commonly see when you type keywords on a search box or search engine, but they can also appear on a website or a blog. Most search engines will require text ads to be labeled as such to prevent misleading users. 

Contextual display advertising

This type of contextual ad can include images and text and is usually displayed on websites relevant to the content. 

Contextual display ads

In-game contextual advertising

Contextual ads are not exclusive to websites, blogs, and search engines. Video games also offer opportunities for monetization by running ads related to the game context. With games, it is important to preserve the user experience and don’t let the ad disrupt it. 

In-game advertising allows brands to reach massive audiences. Considering the millions of users that play computer and mobile games, the possibilities for monetization are really attractive. In the UK alone, there are over 37 million gamers

Here’s an example of a billboard in the game Battlefield 2124 as an example of dynamic in-game advertising. 

legend
Image source

 

In-game advertising can also be static, for instance as the advertisements mimicking real boards in the FIFA games.

game

Image source

 

In-video contextual advertising

There are also opportunities to display advertisements in videos. The advantage of in-video contextual advertising is that it doesn’t disturb the experience, since the ads are related to the content seen. The viewer finds the advert closely related to what they are watching, and as such it generates more interest in the product. Contextual ads prevent the harmful effects of interrupting ads that may turn off the viewers. 

Artificial intelligence plays a key role in enabling in-video ads. For example, advertisers can place ads according to what is happening in the video. AI recognizes scenes, understands facial expressions, and other computer vision applications like logo and image recognition enable it to place the ad where it will most likely blend with the content.

 

Native contextual advertising

Native advertising is a form of contextual advertising where the ads or sponsored content appear like the native content of a website. Native advertising blends seamlessly with the content, although good practices require you to add a “sponsored” label.

Native advertising is not-intrusive: this ad format integrates an advertisement into the editorial style or content.   

There are two main types of native advertising

 

  • Infeed/ In Content: these ads are embedded into content pieces or social feeds. The ads blend with the content and create a non-intrusive user experience. 
  • Content Recommendation Ads: these are displayed as recommended content along with editorial content. For instance, at the end of an article or along the side. 

An example of native advertising could be the Spotify campaign for Netflix’s hit series Stranger Things. For the premiere of the season, Spotify users could enter the “Stranger Things” input in the platform and get a playlist assigned according to a character from the show. 

lucas
Image source

Contextual Advertising on Mobile

With people using their phones for almost everything, targeted advertising includes in-app and in-mobile advertising. As a result of mobile popularity, the in-app advertising market is growing steadily, and it is expected to reach $339 million by 2023

 

statista

Image Source

 

A contextual ad system scans the mobile site and the application for relevant keywords and serves the ads that go better with it. 

In-app contextual advertising offers many benefits:  

  • Provide a better experience: by reducing the intrusiveness of ads. 
  • Protect user privacy: by targeting users without collecting data. 
  • Increase engagement: generate higher results because users see ads related to the app. 

The Difference Between Contextual and Behavioral Advertising

While they are easily confused, contextual and behavioral advertising are not the same. Behavioral targeting is a method that uses web user information to enhance ad campaigns. 

This technique gathers data about the customer’s online searching and browsing behavior to deliver targeted marketing activities, including ads. The targeting is based on the user’s past behavior. For instance, a user reads an article about vacation spots and now they are on a fashion site, they may see an ad related to vacation spots. 

Contextual targeting, on the other hand, involves displaying ads that are related to the content of a site based on relevant keywords. This technique focuses on the environment in which the users browse and shop. Contextual advertising involves assigning relevance to content, keywords, images, and topics. For instance, a user that visits a traveling website will see ads for hotels and flights. 

target

Image source 

Why is Contextual Advertising Important?

Online advertising in a post-cookie market needs to deliver value for the advertiser, the publisher, and the consumer. Contextual advertising provides benefits for everyone. 

Benefits for Consumers

Contextual advertising addresses the privacy concerns of consumers that don’t want their data tracked while at the same time giving them the relevant content they want. 

 

Contextual ads analyze the content being consumed, and therefore, doesn’t need a third-party cookie. The personalization is based on the contextual data from a webpage so consumers don’t usually need to opt-in to share their data. 

Benefits for Advertisers

Advertisers benefit from contextual advertising because they can continue engaging customers without having to rely on third-party cookies. It allows them to reach consumers at the time they are likely to purchase. 

Benefits for Publishers 

Publishers greatly benefit from contextual advertising. They are also pressured to find cookie-less advertising solutions that allow them to continue monetizing the audiences. Contextual targeting provides a solution to place ads without third-party cookies. 

Another benefit is that it allows going beyond keywords, determining a page’s relevance and safety. Finally, it enables niche publishers to also monetize their sites, giving their content the opportunity to be relevant to specific audiences. 

What Are The Cons of Contextual Advertising?

There are not a lot of disadvantages of contextual advertising but here are still a few: 

 

  • Paid ads may be expensive for advertisers. 
  • Ad placement depends on the result of the auction and your competitors. 
  • Ads can be distracting and disrupting.
  • It is not suitable for all products and services.  
  • Ads may be placed along with those of competitors. 

 

How Do You Use Contextual Advertising

A contextual advertising platform operates in three main steps:

1. Powered by Artificial Intelligence technologies, such as computer vision and natural language processing analyzes the information on a web page. The platform scans the following elements: 

 

  1. Content category
  2. Keyword
  3. Page Safety and Sentiment
  4. Events
  5. Text and Images

2. The data is translated into insights to target customers.

3. The contextual platform then places contextually relevant ads on the page that aligns with the content the user is consuming. 

Contextual Advertising in a Cookie-Less Landscape

The industry is leveraging technology for delivering results equal to cookie-based advertising. Here is how contextual targeting is improving in 2021 and beyond: 

Text and Image Analysis

Natural Language Processing allows marketers to understand not only the content but the sentiment of a website. In addition, machine learning helps advertisers provide the most relevant content. 

Brand Safety

Machine learning technology ensures that ad copy only appears to relevant content. This enables them to sell more ad inventory and provide additional scalability. 

Creative Optimization

Contextual advertising platforms ensure marketers can effectively optimize their campaigns in real-time, delivering relevant product recommendations, and sections of content. 

How CodeFuel’s Contextual Advertising Helps You Reach Your Audience 

Publishers can add value to their sites by offering an intent-based journey. CodeFuel’s machine learning capabilities enable it to deliver high yields on every page, with a context-driven company. It is easy to deploy, use, and report. 

 

CodeFuel is a complete monetization platform geared to maximize publisher’s yield by delivering the highest relevance based on intent and advanced analytics. Start monetizing your digital property today. Sign up