Contextual targeting is the new frontier of advertising. Contextual advertising is an advertising technique that targets ads to people based on what they are looking at 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.

Thankfully, the advances in artificial intelligence and machine learning allow marketers to  learn what customers look at on a publisher’s page and deliver ads targeted around it. In this guide, we’ll explain to you the ins and outs of contextual advertising.

In this post

Contextual Advertising (Infographic) What Should Publishers Know?

  • Is the fast growing advertising trend
  • The market will reach $297.68 billion by 2023.
  • What is Contextual Advertising?
  • Is delivering the right ads at the right time to the customers.
  • Elements of contextual advertising
    How Does it Work?
    • Is the fast growing advertising trend
  • The market will reach $297.68 billion by 2023.
  • What is Contextual Advertising?
  • Is delivering the right ads at the right time to the customers.
    • Language
    • Location
    • Weather
    • Time
    • Device
    • Preferred channel
    • Past behavior
    • Purchase history
    1. The software analyzes the content of the page and sets of the categories.
    2. When the user visits the page the ads displayed are matched with the data, delivering relevant results.
    Contextual targeting

    What does Contextual mean in Marketing?

    The context in marketing refers to all factors surrounding the potential customers along the customer’s journey. Their intent — what they are looking for —their demographics, the industry they work in, and their location are some of the factors that provide the necessary context to deliver ads that will resonate with the user. 

    Using the context to target ads allows marketers to deliver the right content to the right people at the right time. It also maximizes the impact of its advertising campaigns instead of shooting in the dark, hoping the ad will reach the right customer.

    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: 

    1. Publishers get more revenues by accessing millions of ads. 
    2. Visitors enjoy an enhanced user experience by discovering ads related to the content they are reading. 
    3. 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. 

    Search demand

    It 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 text ads

    Contextual display advertising

    This type of contextual ad can include images and text and is usually displayed on websites relevant to the content. For example, the NYT book’s section has an ad for LinkedIn since professionals are a great part of the New York Times audience. 

    Contextual display advertising

    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. 


    Image source

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


    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. 


    Image source

    Contextual Advertising Examples

    Contextual advertising is one of the most popular advertising methods. Most probably you’ve seen contextual marketing in your online activity without realizing it. Let’s see some examples:

    Google product ads

    When you look up a product on Google, you often see sponsored ads in the form of a carousel at the top or in a side column, like in the example above. The ads show precisely the type of products you are looking for. For instance, if you are looking for coffee makers, you will, along with french presses and espresso jars.

    Google product ads


    How does it work?

    Google takes your online behavior history, search query, and demographic data, such as your location, to serve contextually relevant ads. That’s why setting your targeting as close as possible to answering your customer’s specific pain points and queries is important.

    Amazon recommendation system

    Did you notice that whenever you look for something on Amazon, you get a row of recommended items below your search results? This is contextual advertising applied to Amazon shopping. The system proposes products that can complement what you are looking for.

    Amazon recommendation system


    How does it work? 

    Let’s continue with the coffee maker example. When you search Amazon for coffee makers for the home, you get the catalog of offerings and, embedded inside, sponsored ads for related coffee makers. Amazon takes your search history and queries, as well as the location, to deliver ads that relate to your search intent.

    How to do Contextual Ads in short?

    Although each ad network will have slight differences, some steps are common. Here are, in short, the main steps of the contextual targeting process:

    1. The advertiser sets the criteria for targeting.

    The first step is to set the targeting criteria on the ad network. For instance, the topics, keywords, demographics, search intent, and location for the ad. These factors will give the network a picture of what type of content is relevant to display your ads.

    2. The platform analyzes the page’s content.

    The ad network analyzes the content on web pages as well as search results and places the ad where it can be more relevant. The language, keywords, search queries, and other targeting factors will be considered. For search result ads, one of the criteria is to have a search query with relevant keywords.

    3. The network displays the ad.

    When all the criteria are met, the network displays the ad on a placement that matches the ad context.

    Difference Between Contextual and Behavioral Advertising

    While they are easily confused, contextual and behavioral advertising differ. 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.

    On the other hand, contextual targeting involves displaying ads related to a site’s content 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 traveling website user will see ads for hotels and flights.

    Difference Between Contextual and Behavioral Advertising

    Image source

    Why is Contextual Advertising Important?

    Online advertising offers an alternative to behavioral advertising that doesn’t rely heavily in first-party data in a post-cookie market. It is easy to implement and more cost-effective than other advertising models.

    Here are some reasons contextual advertising is especially relevant in this market. As we mentioned previously, contextual advertising relies less on first-party data, which results in lower implementation costs. Because it doesn’t rely on personal data, such as the ones collected by cookies, it is safer for advertisers wanting to comply with privacy regulations. 

    A common concern for advertisers is finding their ads in environments with little or no relevance to their brand or, worse, in unsafe environments. Contextual targeting ensures the page where the ad is displayed is relevant to the topic and the user’s intent. 

    Finally, personalization is good, but context is better. For instance, I love baking and cooking, so I’m always looking for new techniques and recipes. I’m more likely to click on an ad related to the content I’m looking at.

    Contextual Advertising Important

    Although this ad, in theory, relates to my business interest, it doesn’t relate to the topic I’m looking for. If I’m looking for recipes, I don’t want to be reminded of the business

    On the other hand, when looking for a recipe to use rice noodles, I got served a video ad that teaches to do easy tortilla wraps. The recipe is available in a cookbook for sale. I will more probably click on that. This is a perfect example of contextual advertising.

    example of contextual advertising

    Benefits of Contextual Advertising

    Although it seems that contextual advertising only benefits advertisers, in reality, it also delivers value to publishers and consumers. Let’s explore the benefits of contextual advertising for each one.

    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 therefore, it 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 to 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 disruptive.
    • It is not suitable for all products and services.
    • They can be overwhelming and cluttering, therefore ignored by the user.
    • 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 to deliver results equipable 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 the content and 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 optimize their campaigns in real-time, delivering relevant product recommendations and sections of content.

    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.


    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. 

    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.


    What is a contextual advertising example?

    A simple example of contextual advertising would be an advert for cookware on a cooking website. Or an ad for running shoes on a health and wellness blog site. 

    What does contextual mean in advertising?

    Advertisers want to increase their ads’ conversion and enhance the user experience. The more the user feels the ad relates to what they are looking for, the more likely the chances of conversion. Context enables advertisers to link the ads to the user’s interests.

    What kind of advertising is contextual advertising?

    Contextual advertising is done automatically via software solutions such as ad networks and monetization platforms. The automated systems display ads relevant to the content of the site and the user’s search query.

    Is contextual advertising programmatic? 

    You can use contextual advertising with Programmatic Advertising campaigns because it is done automatically.

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