Contextual Advertising, The Key for Relevant Ads

Banner ads have been on the Internet since 1994. However, as time passed, the excessive use of internet banners brought noise from traditional media into the digital world. This increasing noise caused internet users to develop banner blindness. 

But that doesn’t mean banner ads are not evolving. A 2020 study shows that contextual advertising causes 43% more neural engagement and 2.2 times better ad recall.

Contextual advertising is indeed a powerful marketing approach. In the following article, we’ll cover how and why contextual advertising works.

What is Contextual Advertising?

Contextual advertising is a marketing approach requiring the advertiser to place his ads only on pages where the product is related to the content. For example, you can place an ad for a cryptocurrency wallet on a website dedicated to cryptocurrencies.

Although contextual ads are also seen in traditional media, they are far more developed and specific on the web. Moreso, it can be seen as a mixture of pay-per-click advertising and media buying online.

Pay-Per-Click

The largest known channel that offers contextual advertising is currently Google Ads. 

In a PPC search ad campaign, advertisers target certain keywords to display their ads on the SERP (Search Engine Results Page) only when users search for those terms. The users are actively engaged in searching the content through the keywords. 

Although the ads appear on the SERP when the user triggers the keywords you bid on, they will be shown with your competition’s ads and the organic results.

Furthermore, SERP is a transitional page. So, the user likely won’t stick around for long, as they are scanning the page for the result that best fits their needs. Yet, when you buy website inventory, the competition is reduced, and the users are more immersed in the webpage’s content.

Media Buying

The mixture between PPC and media buying comes from buying ad space on a website, but only on pages with content related to your ad. 

Nowadays, a display network will help you narrow down the websites you want to appear on by selecting certain categories of websites and introducing keywords in your campaigns.

How Contextual Targeting Works

In a contextual targeting approach, on the display network, your ad is eligible to show on a web page if your adverts match the page’s meaning and language. That’s because your ad can show a user when your targeted language matches the language in which they use Google products or visit sites and apps. Google doesn’t translate ads or keywords.

How does the network know which page matches which advert? 

The display network will choose where to show your ad by having a web crawler scan every website URL and categorize content and placement. When a user visits a page related to your ad, the URL information will pass the request to the ad server. 

Once the request reaches the ad server, it will match the data collected by the crawler for the specific URL with a relevant campaign.

Are Contextual and Behavioral Targeting the Same Thing?

The answer is a hard no. Contextual targeting is sometimes confused with behavioral targeting. However, the difference between the two is significant. While contextual targeting refers to placing ads in a related environment, behavioral targeting proposes showing ads to people according to their behavior.

So, a contextual ad will appear on a website with similar content, therefore contextual. Conversely, through behavioral targeting, the ads will show on any website if the user matches a particular online behavior. 

The ad network will determine the users’ behavior by analyzing factors like browsing history, clicked links, time spent on a page or site, or when they last searched for specific keywords.

If you have data about your customers in a retargeting list, you could easily launch a campaign that targets new users similar to the ones who converted to your website.

Contextual Ads’ Impact

Regarding impact, a 2020 study by GumGum tells us that contextually relevant ads generate 43% more neural engagement and 2.2 times better ad recall. The study also concludes that contextually relevant ads inspire a significant increase in purchase intent.

Considering that the ads are also triggered by keywords related to your niche, the readers landing on web pages hosting your ads will find content with the same keywords. And while they are researching a subject, your ad will respond to a need they consciously have. Therefore, the increase in purchase intent is natural.

Although effective, in reality, you should remember that a contextual advertising strategy can have some weaknesses that influence the impact or even damage your campaign.

Some sites have pages filled with ads, so you still have competition. But, while side banners are more likely to be affected by banner blindness, native ads are likely to be contextually relevant to the sites on which they appear.

And although you may do your best to optimize your contextual targeting strategy, errors might happen. 

When placing banners on a website, the web page’s article may share an opposing view to what you are selling, although it fits all your criteria. And the worst part is that you won’t even know that Google placed your cupcake ads on a webpage with a sugar-free lifestyle article.

Key Takeaways

Contextual advertising is a marketing technique that requires advertisers to place their ads only on pages where the product is related to the content. On the internet, contextual advertising can be seen as a mixture of pay-per-click advertising and media buying.

When doing contextual advertising on the Google Display Network, your ad is eligible to show on a web page if your adverts match the page’s meaning and language.

Although contextual advertising can produce better results than other types of ads, its performance may be negatively impacted by factors like too many banners on a website or displaying your ad on a web page with an opposing view.