There are several advantages of programmatic targeting due to which it is the first choice of advertisers. However, it is the least understood marketing strategy. Wouldn’t it be great if you are able to promote your business to thousands of customers without breaking bank? Well, you can do this exactly with programmatic advertising.

This cutting edge technology allows business to reap the benefits of artificial intelligence to optimize ad placement and targeting the audience in the best possible way.

According to a prediction by Emarketer, US programmatic digital display ad expenditure will reach over $133 billion by 2023. Moreover, the growth, this year will be increased by 29% as compared to the previous year. In addition to this, Statista also stated that programmatic advertising is one of the leading methods for buying and selling ads in the digital sphere.

What is Programmatic Targeting?

It is critical in business to keep up with the current developments, the most important of which is programmatic advertising. It is a type of advertising that allows you to target your audience more efficiently and successfully. Since programmatic advertising is based on an algorithm, it automates the purchasing and selling of advertisements. This means it may modify the timings, placements, ad variations, bid changes, and other elements of your ad in real-time.

It is extremely beneficial for business owners since they will no longer have to manually update or check their campaign settings at all hours of the day.

The AI that drives programmatic advertisements will rapidly assess your ads and make the required modifications to guarantee they run smoothly and automatically. This means you don’t need to squander any more money and can only spend what is necessary to communicate your message to the audience and get the leads you need.

Programmatic Targeting Helps Improve the Working of Functioning

According to reports, programmatic ads accounts for 72% of all digital display advertising spend. This demonstrates that now is the best time to begin using programmatic advertising for your business.

The key reason that programmatic advertising is leading the digital display business is that it does not require face-to-face discussions. Several other advantages may be provided to both advertising and publishers. Let us look at a couple of them:

• Data is Available in Real-Time

Real-time insights on campaign success are provided via programmatic display advertising. So, advertisers no longer have to wait for the outcomes of their initiatives. Real-time data and high-quality reporting enable campaigns to be optimized more quickly and efficiently.

• Relevant Targeting

Programmatic advertising saves on ad wastage since it aims at only the relevant audience and not the ones that aren’t your target.

It appears that addressing them to a certain group of individuals who will be interested in the shown advertising is a wiser strategy. Programmatic targeting allows you to target the proper audience, which is critical for effective advertising.

• Better and Increased Efficiency

Since programmatic ads automates the process, it can enhance the efficiency of your media purchase. This is done by decreasing the need for manual optimization, you may save time and money.

• Higher ROI

By allowing you to focus your money on the most successful placements, programmatic advertising can help you achieve a higher return on investment (ROI).

• Enhanced Reach

With programmatic targeting, you may reach a huge audience with your ad campaigns. This is because programmatic advertising is not tied to a single site or network.

What are the Popular Programmatic Options for Businesses?

The most intriguing aspect of programmatic targeting is that there are several alternatives to select from, and the majority of them may be utilized concurrently to reach a larger audience. Every programmatic targeting approach enables the attainment of online advertising goals more quickly and at a lower cost.

The following are some of the most popular programmatic targeting options:

• Targeting Demographically

When attempting to reach your target audience, it is best, to begin with, the fundamentals. You aim to reach middle-aged guys in this situation. Demographic targeting will assist you in locating the appropriate individuals depending on their age, gender, ethnicity, and education.

• Geo-Targeting 

Geotargeting assists in locating a certain set of audiences. Every device has an IP address that is allocated to a certain area, city, or country, which is why you know who will be interested in your items and where they will be interested. Users’ whereabouts are provided by Internet devices based on the network they use to search online.

• Data Targeting

You may get the greatest results from your programmatic advertisements by using user data. You may pick between three types of data: first-party data, second-party data, and third-party data.

Final Words

Through automated selling and purchase of advertising spaces, programmatic advertising enables firms to reach their target audiences more effectively.

It is a more convenient choice for businesses because it is faster and does not require in-person negotiations.

Moreover, it lets you reach the correct audience through a variety of programmatic targeting choices. That is why it is gaining popularity in the advertising sector and will continue to do so.

According to an eMarketer report, incremental spending on programmatic connected TV (CTV), and video ads will rise to $2.37 billion in 2021. 

This was also confirmed by the IAB’s 2021 Marketplace Outlook Survey Results, which revealed a 21% shift in ad expenditures from linear TV to digital video (CTV).

As we can observe a shift in marketers’ preferences for where to invest their ad expenditures, we can also see a shift in the platforms they use to reach their customers in the right place and at the right time in a brand-safe environment.

The answer to this is contextual advertising. It is capable of comprehending the topic and sentiment of a piece of content. Secondly, it is becoming an even more robust platform to use and comprehend, allowing buyers to reach the relevant audiences through CTV, OTT, and online video.

Rising Usage of CTV and OTT

Without a doubt, Covid-19 is one of the major reasons for an increase in the consumption of CTV and OTT. With almost all the people staying at home, connecting virtually or streaming had to happen.  This has also left the advertisers with no option but to shift their strategy for connecting with their audiences in these digital realms. 

However, the main challenge for publishers and advertisers, remains, to target their audience during their CTV OTT, or an online video experience. 

Contextual advertising makes this possible! 

CTV and OTT might be considered similar, but they are a lot different from each other than we think. 

CTV, which stands for Connected TV, refers to streaming video on televisions, mobile gaming devices, and applications. PlayStation, Sling TV, Roku are all examples of CTV. 

And, over-the-top (OTT) services bypass TV providers and stream on-demand from any device through an app. This can be combined with CTV and is similar to viewing Netflix on your smart TV.

Advertising in CTV and OTT is different and complex from linear TV and this is where the importance of contextual advertising is understood.

Until recently, CTV and OTT advertising relied on IP addresses to provide relevant advertisements. This is similar to how cookies are used, where computers track user activity and serve ads based on what the user clicks on. In the case of CTV and OTT what the audience is watching. 

Unlike cookies, contextual advertising protects your audience’s privacy while reaching them through more granular and effective ad placements in CTV and OTT spaces and by recognizing relevant video content that connects with your target demographic.

This strategy allows advertisers to reach more of their target clients while also making their ad purchases more efficient.

The data also contributes to better transparency and performance metrics in the streaming video industry, allowing advertisers to understand where their advertisements are played.

How Does Contextual Targeting Work in CTV, OTT, and Online Video?

With the TV landscape changing, contextual advertising is the up-and-coming strategy offering a data-backed solution to the conventional IP address targeting. 

Contextual targeting differs from behavioral targeting because that kind of targeting relies on data indicating a user’s interests, behavior, and demographics. Contextual analysis on the other hand depends on the content itself to align ad campaigns with relevant environments. 

Silverpush, an AI contextual advertising company does contextual targeting in CTV, OTT, and online video through its human augmented platforms Mirrors and Parallels.

Mirrors

Mirrors by Silverpush help in context-relevant video level ad targeting using human-enhanced AI technology. It is the world’s first in-video context identification solution, that identifies celebrities, brands, objects, places, actions, on-screen text, and audio for a nuanced targeting at the video level.

During the process, content-aligned ad placement, brand safety, and tailored brand suitability are all guaranteed, along with reaching the largest possible audience.

Parallels

Parallels real-time TV Ad Sync helps brands recapture viewers’ attention with real-time syncing of television ads with digital ads.

It connects with the audience contextually and in real-time by automatically triggering sports ads based on live moments, running contextual creatives, and syncing digital ad placement during TV commercials.

Conclusion

Contextual advertising is the solution for advertisers searching for a targeted and data-backed plan to engage with their target audience.

This strategy does not depend on the IP address and maintains the user privacy by putting ads depending on video content. With this technique, marketers can more precisely contact their target audience where they are by watching video content.

Years before, one of the most spirited topic for debate was whether to put budget against contextual or behavioral targeting. Every marketer wants to approach their target audience at the right time in the right context. This has been achieved by implementing the methods of contextual targeting.

So the question now arises, what is contextual advertising? and why is it on top of mind now?

In this article, we will cover all the aspects of Contextual advertising, starting from what it is to why is it so important to target digital advertising and various contextual advertising services.

What is Contextual Advertising?

Contextual Targeting is the process or practice of displaying ads that are relevant to the website’s content instead of just the user’s data. It is a targeted and automated form of digital advertising. Imagine placing an ad for shoes on a clothing website, or an advertisement for dishware on a recipe site. It’s kind of placing a digital version of a print ad in a highly reputed magazine.

The idea of a contextual approach has been in the market for a really long time. However, it has been gaining more popularity ever since the privacy regulations have become more strict. Moreover, the whole practice of contextual advertising or targeting majorly relies on context and not on user’s personal data.

What are the Different Types of Targeting?

There are various different types of ad targeting present for digital advertising. Let’s check five of the most popular practices of targeting:

• Behavioral Targeting

Behavior targeting is focused more on the actions a user makes before reaching the web page, whether it’s clicking a particular link, product page, or article. One good example of behavioral advertising is retargeting ads.

• Contextual Targeting

In this method, we practice deploying ads based on the website’s content. It works by assuming someone visiting a site and shall be interested in buying other types of utility products as well.

• Search Retargeting 

Search retargeting means displaying ads to users when browsing the web as per their keyword search behavior. In simple way, it means that when you set up a search ad campaign, you choose the type of keywords that match your business or products. Let’s take an example to understand this term better. Imagine a company selling women’s shoes also serves ads for searchers looking for “women’s boots” or “black heel evening shoes.”

• Site Retargeting 

One of the most common types of retargeting consists of showing ads to the users who visited your site but left without making any purchase or doing an action that showed their interest in your content. This targets brand recognition, this method can bring a high ROI by targeting the bottom part of the funnel.

• Predictive Retargeting

Predictive retargeting uses data collected by behavioral targeting adding a bit of 3rd party data mix and analyzing & predicting buying patterns with the help of artificial intelligence and machine learning. With the help of the AI feature, it can identify behavior patterns, identify products to upsell or cross-sell, and target those audiences which is most likely to convert.

How does Contextual Advertising Work?

Contextual advertising uses artificial intelligence and deep machine learning to analyze content like text, speech, imagery, and geolocation in real-time.  Contextual advertising services use tools like Silverpush’s Mirrors to analyze all this data and content to understand if the user will click on your ad. The deep analysis by AI is just like how a human would deploy your ad manually, which ensures that your ad is placed contextually at the relevant place, and is received to your target audience at the right time.

Silverpush’s AI technology Mirrors identifies key contexts such as celebrities, brands, objects, emotions, places, actions, on-screen text, and audio. In addition to this, it also intelligently avoided placing ads against content falling under unsafe/ unsuitable categories like kids, violence, politics, COVID-19, and others.

Reach Target Audience in a Cookieless World

There is no secret that we all love privacy and are very hesitant to share our personal information online. In fact, in a recent survey by Startpage, it is shown that around 72% of Americans are “very concerned” to “extremely concerned” about their online privacy. There are various methods available to target your audience. However, because of new regulations like GDPR, it is going to be difficult for both publishers and advertisers to get consent from users to collect their data for targeting.

[Also Read: Learn About Contextual Targeting and Relevance of Ads]

What are the Pros and Cons of Contextual Targeting in Digital Advertising?

Now, that we have understood the concept of contextual targeting (let’s hope for the best!) shall we now proceed further to see the pros and cons of contextual advertising. It is no doubt it is one of the most effective method of digital advertising but like every coin has two sides, it also has its cons which should also be addressed. These are –

Pros of Contextual Targeting

1. Since it relies very little on personal data, contextual targeting is very effective as it compliances with regulations like GDPR with ease. Furthermore, if you don’t collect personal data but only information about the website, then the targeting is outside the terms of the GDPR, and regulation doesn’t apply.
2. If done right, contextual targeting can enhance the user experience by adding information to the content in a timely manner. Some studies have shown that contextual targeting may increase purchase intent by 63%.
3. Contextual targeting is majorly focused on the interest of the user. For example, contextual advertisements in review sites may increase the number of clicks.

Cons of Contextual Targeting

1. You need to be extra mindful when setting up your ad campaign to ensure that the context is not too broad.
2. Frequency capping can be an issue.

What are the Future Trends of Contextual Advertising?

Contextual advertising may have been around for a long time but nothing remains static especially when the technology is developing every day. Here, we have mentioned some of the top trends in contextual advertising that you can look out for in the future.

Advancement in relevant software 

In order to improve the relevance of targeted ads, developers are trying to improve the need to just insert a JavaScript code into the webpage.

In-text video contextual advertising methods

There are some new technologies emerging in the digital market that allow placing in-video text advertisements on YouTube. It can scan the video for content and display ads based on it.

In-game contextual ads

For some time, developers are trying their best to insert contextual advertising in video games. If an ad appears in the middle of a game it can become very annoying for the gamers. Thus, inserting an ad before or after a game is much more effective and less disruptive for the gamer. With app developers who are trying to monetize their applications, thus developers are trying to find a way to integrate contextual advertising without interfering with the gaming experience.

FAQs on Contextual Approach to Targeting Digital Advertising

Ques. What is Contextual Targeting in digital marketing?

Ans. It is the practice of displaying ads based on a website’s content rather than user’s data. Thus, it reaches the target audience in the relevant context at the relevant time. With the help of contextual advertising, ad placements are viewed as helpful rather than intrusive to the user’s experience. Thus, Contextual Targeting is Key for future digital advertising and trends.

Ques. What is an example of contextual targeting?

Ans. One example of contextual advertising is a shoe brand that could display an ad for sports shoes in a news article about triathlons or on a forum for running/marathons. Another example could be a flour brand that could display its ads on a website which is dedicated to baking or recipes.

Ques. What is contextual targeting in Google Ads?

Ans. Contextual targeting is a practice of personalized advertising that enables your Google PPC ads to appear on relevant websites. In order to get started, you need to input keywords or topics and then set a campaign to show ads on the Display Network.