Optimizing Cookieless Advertising with Contextual Targeting

The power of contextual targeting in modern digital marketing

Imagine that you're walking into a local grocery store to buy ingredients for dinner. The moment you enter, you're greeted by brightly colored signs advertising athletic wear, a product that the store doesn't offer and that you have no interest in buying at the moment. You see more ads as you pass through the aisles for produce, bread, and frozen foods.

This type of advertising choice seems nonsensical, but it's exactly what happens when you use digital marketing strategies like behavioral targeting. It's also why contextual targeting offers so much value to businesses across practically every industry.

Contextual targeting empowers companies to market their products and services on web pages that have related content. By capitalizing on timing and intent, this type of targeting makes it possible for your business to grow, increase sales, and convert more customers at a low cost. Understanding how to effectively use contextual marketing is crucial for businesses hoping to thrive in a new era of cookieless advertising.

What Is Contextual Targeting?

Contextual targeting refers to the practice of placing ads on websites or apps based on their content. Rather than putting up ads arbitrarily, marketers strive to align the subject addressed on the website with the focus of the ad.

For example, if you visit a website with dessert recipes, you might see an ad for kitchen mixers or baking pans. This targeting is based on the logical assumption that someone who is interested in making desserts might find links to baking supplies intriguing and helpful.

Marketers have been aware of the importance of contextual targeting in advertising for decades. Early print publishers placed ads in their magazines and newspapers based on the material discussed in that section. People reading articles about baseball players would see ads for bats and mitts.

The same concept has carried over into the age of digital advertising but with the added bonus of technological progress. Companies can use sophisticated software to more effectively target their products to audiences on a larger scale.

What Are the Types of Contextual Targeting?

All contextual advertising follows the same basic principles, but there are different approaches to identifying relevant content. Businesses can use a combination of three contextual targeting types to optimize their online presence.

Categories

Also known as topic targeting, this type of contextual targeting involves assigning ads to content based on broad categories. Possible topics might include:

  • Fashion
  • Banking and Finance
  • Automotive
  • Beauty
  • Food and dining

Because these assignments are so general, this is the simplest but also the least reliable form of contextual targeting. However, platforms such as Google also allow you to choose narrower categories that will target your ads more successfully.

For instance, a restaurant chain might choose the "fast food cravers" topic under food and dining. This ensures that users will come across their ads while looking at recipes for burgers and not when they're researching fine dining menus.

Keywords

For more accurate results, companies can employ keyword contextual targeting. In addition to assigning categories to ads, they select multiple keywords that reflect the interests and demographics of their potential audience.

These terms and phrases are then matched with corresponding keywords on different web pages. This allows for more nuanced targeting and a greater likelihood that your ads will make their way in front of interested users.

Semantics

Although contextual targeting is a tried and true practice, developments in technology have allowed advertisers to refine their techniques and achieve better results. Semantic targeting uses machine learning and artificial intelligence to analyze a web page and determine whether it's an appropriate and relevant environment for your ad.

Businesses can leverage this technology to identify relevant keywords for a web page. This enables you to move beyond a set of terms that were written in a specific order. You can find semantically related keywords that reflect the same intent with slightly different terminology.

How Does Contextual Targeting Work?

Contextual targeting uses the subject of the content that consumers are currently viewing to display ads that they'll find entertaining and useful. To accomplish this goal, marketers have to follow a specific process to set up their ad campaigns.

Selecting Targeting Parameters

Choosing topics and keywords is the first step of contextual targeting. It's also the foundation for the success of your ads, so picking the right options is critical. Think carefully about what words and phrases your target audience will use when searching for content and what overall topics they'll find most engaging.

These are the most important parameters you can use to target your ads:

  • Topics and keywords: Google recommends using between 5 and 50 keywords that closely connect with various aspects of the products and services you're advertising. For instance, keywords for laptop ads might include different models, names of operating systems, and types of software.
  • Negative topics and keywords: In addition to identifying what parameters you want to associate with your ads, you can also exclude those that you don't want. Choose negative topics and keywords that are irrelevant to your ads or that you don't want to connect to your brand.
  • Location and languages: If your company offers products or services that are exclusive to a particular part of the world, you may also want to define target locations and languages. This helps ensure that your ads reach users in the places that are most suitable for what your business offers.

After your ads go live, it's a good idea to monitor their performance. If you see weak spots, consider what you might achieve by modifying their parameters.

Analyzing Online Content

Once you've selected your topics and keywords, you can use ad platforms or contextual targeting companies to look for relevant sites and match them with your ads. To make that determination, the platform will consider:

  • Link structures
  • Themes
  • Alt text
  • Language
  • Page structure
  • Keyword usage
  • Text

Keep in mind that your ad won't necessarily appear on every page that it matches. Factors such as location and language targeting play a role in determining where ads are displayed.

What Is an Example of Contextual Targeting in Marketing?

By design, contextual targeting in digital marketing isn't always obvious. It's a more subtle approach to advertising than behavioral tracking, which tends to be unnerving. However, once you know what to look for, it becomes clear that this type of advertising is all around us.

Consider these contextual targeting examples:

  • Location: You target ads for your restaurant toward your local area. When customers research tourist attractions to plan their itineraries for an upcoming trip, they discover your business and make plans to eat there.
  • Keyword: When creating ads for your jewelry business, you select keywords such as diamonds and engagement. Future brides and grooms who are reading an article about creative wedding proposal ideas will come across an ad for your shop.
  • Topic: You select weightlifters under sports and fitness as the topic for ads for your sports equipment business. When potential buyers read an article about weightlifting techniques, they see an ad for the barbells and benches available at your store.

What contextual targeting looks like for your company depends on what you offer, what types of people you hope to attract, and what parameters you select when you establish your campaign.

Why Do Companies Use Contextual Targeting?

Despite its long history, contextual targeting had fallen out of favor as companies seized the opportunities presented by cookies. Cookie technology provides detailed audience data that companies use to personalize their ads. In recent years, however, concerns about privacy have revealed that cookies are imperfect tools, and companies are returning to new and improved cookieless solutions, including contextual targeting.

Contextual Targeting vs. Behavioral Targeting

To fully understand how to target ads with context, it's helpful to take a closer look at the alternative. Behavioral targeting is an advertising method that uses a consumer's actions prior to visiting a webpage to determine what advertisements they should see. Those behaviors are tracked with cookies, which collect data about actions such as:

  • Reading articles
  • Clicking links
  • Visiting product pages

While this strategy provides businesses with ample information about their audiences, the data they receive isn't necessarily useful. As a result, an ad might display on a page with completely unrelated content, such as a banking ad on a website about the best places to go camping.

Contextual targeting takes the opposite approach, ignoring past actions and honing in on their present mindset. When they visit a camping webpage, they might see advertising for tents, coolers, or bug spray rather than for financial services. Behavioral targeting has been the go-to tactic for several years, but it's losing favor with many businesses that are looking for a more consistent and safer approach.

The Rise and Fall of Cookies

The decreasing use of third-party cookies has only added to the bad news for behavioral targeting. In a July 2021 survey, 51% of senior marketers said that third-party cookies made up the majority of the data they used for marketing purposes. Fast-forward to today, and you'll find that those cookies are on their way out.

The shift to cookieless advertising is the result of several factors, including:

  • Privacy concerns: When businesses use cookies, they collect and store user information. Data breaches and new regulations have made it much more difficult for companies to convince customers that it's worthwhile to grant them access to their personal details.
  • Browser changes: The world's biggest browsers have already eliminated or are in the process of phasing out the use of third-party cookies. Following slight delays, Google Chrome announced their plans to stop using them by the end of 2024.
  • Flawed data: The data that cookies provide is often inaccurate. Advertisers who base their decisions on cookies may be wasting time and resources targeting the wrong audience.

Businesses that have relied on cookie-based ads may worry about the impact of these changes. Fortunately, contextual targeting is an alternate way to create targeted advertising without collecting any individualized user data.

Distinguishing Between Contextual Targeting and Native Advertising

Although marketers sometimes use the terms interchangeably, native advertising and contextual targeting are separate concepts with distinct purposes. Businesses can make more informed marketing decisions when they understand how both tools can contribute to a lucrative ad campaign.

Native Advertising Defined

The goal of native advertising is to make ads less obvious, distracting, and obnoxious. Blinking ads with clashing color schemes are off-putting to consumers, and many of them have begun tuning out and ignoring these forms of aggressive advertising. For your ads to make an impact, you'll need to make a more positive impression.

To make this happen, you'll create ads that blend in with web page content rather than standing out and making a statement. Because of the visual effect, the ad seems like part of the overall page interface, but it leads users to an external third-party link.

Key Differences

In many ways, native advertising and contextual targeting are branches of the same tree. They're both meant to appeal to your audience, but they do so in unique ways.

Contextual targeting focuses on placing ads on web pages or apps with relevant content, whereas native advertising ensures that ads are aesthetically relevant. Many native ads also align in terms of web content, but that's not always the case. An ad that reflects the appearance of a website may or may not focus on a related topic.

Combine Methods for Better Advertising

These marketing methods can have a powerful effect on an advertisement's success, and they aren't mutually exclusive. Combining contextual targeting with native advertising allows you to create ads that are visually appealing and useful to consumers.

The ads you develop using both techniques will not only fit in with the design and color scheme of a website but also reflect the content. As a result, customers will get the best of both worlds. The ad won't detract from their user experience, and it will provide them with information that relates to their interests and needs.

The Benefits of Contextual Targeting

Contextual targeting is a long-standing practice for good reason. It offers a wide range of advantages to businesses and has minimal downsides.

Increased Advertising Control

Targeting based on context gives you more power over determining where people will see your ads. Using negative keywords and categories, you can prevent them from showing up on irrelevant sites. You can take an even stronger stance by identifying specific websites or pages where your ads should never be.

Clearer Reflections of Customer Interests

Unlike behavioral targeting, which relies on a customer's past to determine their preferences and needs, contextual targeting focuses on their present state of mind. People are more likely to follow through on purchases when you catch their attention at the right moment. For example, a person scrolling through a list of recommended workouts is more likely to respond positively to an ad for protein powders than a person reading up on baby toys.

Higher Levels of User Comfort

Cookie-based ads follow people from one sight to the next, regardless of whether they've switched from reading a news article to scrolling through social media. For many customers, this creates the sensation that you're constantly monitoring and stalking them.

For this reason, behavioral targeting can backfire, causing your audience to have an unfavorable impression of your company instead of a good one. Using context to choose placement for ads means that they won't experience this level of discomfort.

Reduced Ad Fatigue

A 2020 survey from HubSpot Research revealed that 91% of people find digital ads more intrusive than they were in the past. That feeling and the presence of never-ending, irritating advertisements lead to ad fatigue. This, in turn, causes customers to install blockers or ignore any and all ads, including ones that could actually benefit them.

Contextual advertising, on the other hand, is more closely tied to a person's interests at any given moment. It also raises your conversion rate by ensuring that your advertisements reach an audience that's more likely to make purchases.

No Retargeting Loops

If someone visits a website for an electronics store and looks at cell phones, those actions will result in cell phone ads popping up all over their social media feeds and the subsequent sites they visit. However, the customer already bought a cell phone on the original site and has no need for another one. In other words, the retargeted ads are annoying, redundant, and not at all helpful.

This problem doesn't exist with contextual targeting because ad placement is unrelated to users' previous activities. Instead, a person visiting a page about cell phone reviews or repairs might see an ad for cell phones, capturing their attention at the moment when it actually matters. After they make their purchase, they won't see those ads again unless they return to a relevant web page.

Simplified Advertising Strategies

Compared to other marketing tools, contextual targeting is typically cost-effective and easy to implement. It doesn't require complex technology, internal data analysis, or lengthy periods of development.

Most businesses can quickly set up a campaign and begin to see results right away. They can also achieve a greater return on investment (ROI) than with behavioral targeting.

Decreased Data Reliance

Effective behavioral targeting is entirely dependent on cookies. In the past, users didn't have a clear choice when it came to cookies, so it was easy to obtain and share their information.

New privacy laws have turned this concept on its head. You can now opt out of cookies, leaving companies without access to the data they need to deploy their ads.

Contextual targeting sidesteps this issue. You don't need any customer data to make it work, so the option to refuse cookies has no effect on the success or failure of your advertising.

More Appropriate Placement

No one benefits when your ads wind up on websites where they don't belong. Unless your products or services are relevant, you'd most likely prefer that they aren't present on an extremist or adult content website.

Associating with those types of pages can cause lasting damage to your brand as a whole. Using context parameters to limit the web pages that can display your ads makes it easier to prevent these harmful outcomes.

Larger Audience Pools

Sometimes people don't purchase items because they don't realize that they need or want them. When you use context to seek out your audience, you can present your product or service to a broader group of potential buyers with very little effort or expense. At the same time, narrow keyword and category options make it possible to reach niche audiences that may be difficult to connect with in other ways.

Fewer Compliance Concerns

Government agencies and regulatory bodies around the globe have taken steps to protect consumer privacy. Violating these regulations can lead to steep fines, reputational damage, and downtime.

Advertising strategies that focus on behaviors make compliance more challenging because of the need to track users and collect their data. Contextual targeting doesn't present any of those concerns because individual user tracking is unnecessary. You can reach your audience without worrying whether you're meeting regulatory standards or putting someone's data at risk.

Preparing for a Cookie-Free Future with Nativo

One of the greatest advantages of contextual targeting is that any company, no matter its size or structure, can put it to good use. However, to get the best ROI and maximize your customer reach, you'll need to take a thoughtful approach to your ads.

Nativo is an ideal partner to help you optimize your advertising without cookies. Our Nativo Predictive Audience technology maximizes your audience targeting and engagement — without the need for cookies. Contact the team at Nativo to learn more about our premium advertising experiences or to request a free demo.

See what's possible with Nativo. Fill out the form below to schedule a free demo with one of our dedicated experts.

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