In this article, we’ll explore how to calculate the ROI of the activities mentioned, and some other ways to measure the value of content.
The Resurgence of Contextual Advertising
In today’s digital world, the word “advertising” has taken on negative connotations. People are actively blocking ads on their computers, mobile devices, and websites. Third party cookies will soon be blocked from all major browsers and cross app tracking on iPhone’s no longer works. Advertising methods that have been at the heart of digital marketing for most of this century are therefore becoming obsolete. As a result, marketers need to find new ways (or return to old ways) to reach their audiences without appearing as an intrusion.
This is where contextual advertising comes in. It’s effective because it targets users based on their interests, which are identified using contextual signals such as their location and the content they’re browsing. By understanding the context of a user’s search query or the web page they’re viewing, advertisers can serve relevant ads that are more likely to be clicked on.
This method is becoming increasingly popular because of the advances in AI and machine learning, which allow context-based advertising platforms to better understand user intent. In fact, the contextual ad market size is projected to grow significantly – in 2020, it was valued at $140 billion USD and by 2028, it is expected to be worth $476 billion.
What is Contextual Advertising?
Since its inception, this method has gained popularity among advertisers and publishers. The model is used on mobile apps and websites to serve ads that are related to the app content, user search queries, or website topics.
This form of digital advertising allows marketers to deliver relevant ads based on the content the user is looking at and in some cases, location signals (such as their IP address), as well as the type of device they’re using and the time of day. It even takes into account the weather.
The method is unique in that it tailors ads to fit the user’s current situation and environment. For example, if a user is looking up restaurants in a nearby city on their mobile device, an ad for a local pizza joint could appear near the top of their screen. This technique helps improve click-through rates and increases the chances that visitors will take action on the ad.
Back in the early days, contextual ads were delivered only as banner ads that were placed next to content that matched the advertiser’s intent but as technology evolved, more formats became available. Today, contextual ads are also delivered as videos, interactive ads, or other content types, and various types of devices now use this technology. These days, machine learning algorithms make the process more efficient – they can analyse the probability that a user will take action based on various contextual factors, ensuring that ads are placed in the most optimal places.
Contextual ads target specific topics and keywords. Advertisers can select keywords that they would like their ads to be associated with, and Google will match those keywords to relevant web pages. By selecting relevant keywords, you can make sure that your ads are displayed on websites that are likely to be visited by people who are genuinely interested in what you have to offer.
Why Is Contextual Advertising Effective?
This method provides advertisers with a greater opportunity to reach their desired audience in a more personalised manner, while also reducing the risk of appearing too intrusive. Because the ads are more relevant and personalised, people are more likely to engage with them, click on them, and make purchases. Some research actually showed that ads with contextual significance receive 43% more engagement, 2.2 times greater recall, and a significant increase purchase intent.
Now, let’s compare contextual and behavioural advertising. Behavioral advertising refers to the use of data collected from a user’s interactions with websites and apps to target ads at them. It is based on their previous actions. The most common type of behavioral advertising is retargeting – when a user visits a site, they may be served an ad from that site later on.
The issue is that sometimes, context has far more weight than previous behaviour when it comes to consumer decisions. External factors often influence purchase decisions and behavioural advertising does not account for that.
For example, the weather can have a huge effect on buying behaviour, even for the most simple choices such as food and clothing preferences. Combining weather and location data is a great way to ensure you’re targeting people that are going to be receptive to your offer. A company selling ice-cream or swimwear could target a location experiencing weather that is hotter than usual during a specific period, and raise awareness of their brand at the same time. Other types of advertising simply do not consider the flexibility of decision making in this regard.
Some other benefits are:
- Targeting options – You can use contextual data to target users or audiences with varying degrees of precision. You can also use it to exclude certain users from seeing your ads. For example, if you are running an ad for a dating app and you don’t want to show it to children, you can use contextual data to target only adults.
- Brand awareness – You can reach customers you otherwise would not have been able to reach based on behavioural factors. Even if people don’t purchase, they will see your brand and may click on your ads and visit your website or store. Tracking these impressions can help you to track your brand awareness and gain valuable insight into your customers’ shopping habits and preferences.
- Privacy – People are becoming more aware of online privacy issues and more concerned about them than ever before. Google also announced the scrapping of third-party cookies in it’s Chrome browser – the most popular browser out there, reducing the extent to which customers can be tracked. Context-based ads still allow advertisers to collect valuable information – without the need for cookies.
- Ease of implementation – Less data analysis is required to implement contextual ads effectively compared to behavioural-based ads. AI analyses and refines the algorithm; it recognises patterns in user behaviour and modifies the algorithm to ensure the best outcomes.
Are There Any Drawbacks?
It’s possible that consumers may find ads distracting, especially if they are placed in a way that disrupts the content they’re viewing. This can lead to a couple of undesirable outcomes – the viewer may completely ignore all ads presented to them, or they may choose to block ads due to the annoyance. The less tech-savvy audiences are becoming more aware of the fact that they can block ads on their computers and mobile devices, and many are actively doing so.
There’s also the potential for increased competition, as competing ads may be placed next to yours. If the user is already familiar with the competing brand, they are likely to click the ad for the brand they already know. To get around this, consider how you can make your ads so compelling that they can’t help but click through.
Contextual Ads on Google
You can set up contextual ads through the Google Display Network. Google states that the network consists of “a collection of over two million websites that reach over 90% of internet users across the globe”. When you set up a new Google ads campaign, select “display network only” as the campaign type.
On Google, contextual ads are based on selecting relevant topics, as well as keyword targeting. The topic is just the category of the content that would match your ads. You can choose a broad category such as sport, and more specific sub-categories such as cycling, tennis, and so on. The keywords let you target more specifically within your topics and sub-topics (remember to use negative keywords if you want to prevent your ads being shown to certain audiences).
You can also select either broad or specific reach. If you use broad reach, Google will use your topics for targeting but with specific reach, Google will only display your ads on pages that use some of the same keywords, and match at least one of your topics.
When you’ve identified your target demographic, topics, and keywords, you will need to set a few more parameters including location, device type, device OS, or app usage. If you were running a marketing campaign for your new fitness app, for example, you can use contextual targeting to show ads to people who are likely to use fitness apps.
As always, your ads should be concise and clearly explain the benefits of your product or service. They should also use powerful language, calls to action, and they must be well designed and easy to read. As I mentioned, your ads may be placed next to ads from competing businesses, so make sure yours stand out. Once your ads are displayed, monitor their performance and make adjustments as necessary.
When done right, contextual advertising is an effective and efficient way to reach your target audience. It allows you to tailor your ads so that they appear when and where they are most likely to be noticed by your target market, making your investment more worthwhile.
While it does have some disadvantages, it brings many benefits including greater exposure, click through, and brand awareness. There are many factors influencing our buying decisions besides our previous behaviour – we’re all subject to giving into temptation in the right conditions, and factoring context into our marketing efforts is a wise decision.
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