"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Alexander Knudsen, VP of solutions engineering at Amobee.
As marketers confront a data-deprecated world, contextual targeting is seeing a renaissance. But despite the fact that using content signals as proxies for purchase intent is as old as advertising, myths about contextual targeting proliferate. Here are some of them — as well as advice about what marketers need to know to get beyond them.
MYTH: Contextual advertising will replace ID-based targeting
While third-party cookies are going away, ID-based targeting will continue to drive first-party data performance campaigns, if only to a point. The problem of scale lifts its head. The fact is, there’s a limit to the number of permissions an advertiser can secure. After big advertisers exhaust their 1:1 performance audiences, they’ll need to use contextual signals as part of their strategy to scale up in an intelligent way.
MYTH: Contextual targeting isn’t as sophisticated as ID-based targeting
Web behavior data drives the vast majority of the look-a-like targeting that underpins the cookie ecosystem. In other words, contextual signals already play a big role in ID-based targeting. But this myth persists because there’s a misunderstanding about capabilities.
Some in our space incorrectly believe that only cookie retargeting allows for both audience layering and recency. Again, that’s false. Contextual covers both of these vectors — browsing behavior as a proxy for purchase intent and timeliness.
The myth likely stems from the way that advertisers have historically used targeting. Throughout the programmatic era, advertisers relied on past browsing behavior instead of on finding consumers when they happened to be in a purchase mindset.
Going forward, contextual will emphasize timeliness to a greater degree by prioritizing signals associated with consumers’ content consumption during their buying experiences.
In other words, what consumers have bought or browsed in the past will no longer be the most important thing for advertisers. Rather, it will be more important for advertisers to draw inferences from the content that consumers are engaged with at the moment.
True, contextual targeting is driven by keywords, but it’s actually quite sophisticated. Consider the various ways an auto advertiser might use contextual. At a basic level, the advertiser aligns with auto content, achieving relevance and timeliness.
But context is also about non-endemic insights. Car buyers typically apply for auto loans, for example. A smart contextual advertiser can align with auto loans and other adjacent categories to identify the most likely intenders and distinguish them from audiences that are simply interested in auto content and don’t really want to buy.
There’s a good amount of low-hanging fruit here, too. Consumers considering the purchase of a new vehicle are often entering new life stages. Maybe they’ve just graduated, or they’re getting married, or they’re becoming parents, or they’re on the cusp of retirement.
In addition to accessing auto-specific content, those consumers will also engage with content that aligns with their current life stages — and advertisers would do well to note that fact. Engaging with consumers within the context of an AARP publication, for example, may not strike an auto advertiser as an obvious thing to do, but it can pay off.
Similarly, audiences interested in wearable fitness tech, like fitness watches, also engage heavily in the business travel sector. Fitness tech brands that want to cut through should go out of their way to compete in precisely that sector.
Non-endemic opportunities like these can require experimentation to find, but they’re worth it. They pay off in two ways. First, they help advertisers reach consumers in new contexts. Second, they let advertisers take advantage of media buying inefficiencies by shifting dollars to relevant non-endemic contexts.
Conclusion: How To Think About Contextual Targeting
Contextual solutions must do three things:
- Identify audiences by their interest in a specific category
- Consider that information holistically, in relation to all other audience interests
- Make strategic targeting decisions based on that information
Regardless of which vendors they choose to work with, marketers must demand all three deliverables.
Just as important, they need to understand that once you move beyond certain obvious contextual insights, contextual targeting is really about empowering advertisers to build intelligent ad practices in a data-deprecated world. In other words, contextual isn’t just a matter of another vendor to load into your stack, it’s a framework for moving forward in the face of industry-wide disruption.