Contextual Intelligence is the Future of Targeting

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Digital advertising has come a long way from simple banner ads and pre-roll video ads. Today advertisers have different kinds of approaches to choose from that allow them to deliver personalised ads to their target audience. The reason advertisers prefer to go digital is because they can target a specific group of users with customized messaging, it allows them to go hyperlocal and in the long run gain economies of scale. Technology, too, has evolved to make this possible like identifying prospects and making adjustments in real-time in the campaign delivery.

In the last few years, however, a lot of concern has been raised about data privacy, security and even the fact that users are constantly bombarded with ads as soon as they open a webpage. Imagine you have just started a diet and you are very excited about losing weight, but the minute you step out of the house you start seeing ads for burgers, pasta, and all kinds of fast food. This would not just weaken your resolve to diet, but it would also make you angry because in your current situation all these ads are irrelevant for you. This is what happens when a user logs in to any digital media today and this is the problem that advertisers want to solve because of various reasons:

Any budget that is spent showing an ad to a user who would not connect with it, it would be money essentially wasted
If users feel that a particular advertisement is being intrusive, they would create a negative association with the brand, which would not bode well for the brand’s image
Irrelevant advertisements soon become a blind spot which results in lower viewability and ultimately poor campaign performance

Along with these issues, there is also the problem of regulations and legal frameworks that have now been put in place to safeguard the privacy of internet users. So, how can brands solve this problem and stay relevant to their audience? The digital universe finds itself in a phase of transition where it is not getting appropriate performance from cookies, resulting in poor viewability and more users making use of ad blockers. The answer to this is contextual intelligence.

Contextual advertising vs Contextual Intelligence

Contextual advertising is the foundation from which the idea of contextual intelligence was born. Contextual advertising, to put it simply, placed an ad on a webpage that was contextually relevant based on the keywords. The advertiser would run his ads by targeting keywords relevant to his brand, product, or service. However, since this approach is largely based on the availability and use of specific keywords the reach that an advertiser can get from this is limited.

Contextual intelligence, on the other hand, makes use of more detailed analysis of the webpage where the ad can potentially run. It takes into account the visual components of the page and their compatibility with the text. It allows advertisers to combine the relevance of contextual targeting with first party data, to which advertisers have access. This ensures that the right ad is served to the right person at the right time.

Why trust Contextual Intelligence

The introduction of new laws and regulations that protect the internet user has left advertisers with a blind spot. This is a drastic change, but brands cannot afford to adapt to this at leisure. There is also the fact that many advertisers had already started moving away from third-party cookies because of poor performance, which paved the way for new technologies such as Contextual Intelligence.

Contextual intelligence maximizes the opportunity for engagement on ads and increases the probability of the user remembering it. This can be done by making use of Artificial Intelligence (AI) and Machine Learning technologies that can predict contextual segments by creating a list of keywords based on top trending content or topics. AI can go further than keywords and help advertisers come up with more sophisticated options for audience targeting.

On average, a digital user encounters between 6,000 to 10,000 ads in a day. This underlines the need for ads to stand out and make an impact on the user; only then can an intent or an action be expected out of him. By investing in contextual advertising and intelligence, brands are increasing the probability of the ad making an impact on the user, being remembered, or at the very least create a recall for the brand itself.

Why put your money in Contextual Intelligence?

A study released in March 2020 by GumGum and SPARK Neuro showed that contextual ads generated 43% more neural engagement and users were able to recall the ads 2.2x times more as compared to contextually irrelevant ads. The study explains, “Neural engagement is key to direct response performance”. When the ads are contextually relevant, there is a greater probability of the ad being memorable and more likely to drive purchase intent in the user. High context ads were remembered an average of 10 times more than low or medium context ads.

Contextual intelligence plays a significant role in providing advertisers with relevant audiences at a lower CPM as well. It enables the programmatic purchasing of digital advertising space (impressions) based on appropriate and relevant categories. With the help of machine learning and natural language processing, contextual intelligence makes it possible for the website’s content to be relevant to both the brand’s message and the users on the site and provides alternate websites that perform well at lower costs.

Future of Contextual Intelligence

It is safe to say the behavioral analysis and targeting has phased out; it is not the preferred method of advertising for brands that are looking for relevant reach and better rates. The industry had accepted that contextual intelligence has the capability to deliver more efficient results as it places relevant content in front of interested users.

It also addresses two points that have gained great importance, considering the introduction of recent digital regulations – brand safety and data security. Contextual intelligence ensures that the brand’s message does not appear next to inappropriate content since it matches the advertiser and its target audience with the website’s content. In the coming months, markets such as India will see even higher traction on the internet with the introduction of 5G, affordable data plans, and better connectivity across the country. This opens an opportunity for more innovative ad formats that drive higher engagement and interaction with the user. There may be more prolific use of Augmented Reality or Virtual Reality since users would have the data speed and devices to interact with such technology.

All these changes would make it necessary for advertisers to have an AI-enabled system at their disposal to compete with other brands, in real-time, to get the user’s attention. By adopting a new paradigm using contextual intelligence, advertisers will be able to gain the advantage of building for the future of advertising before the third-party cookie environment and behavioral targeting environment completely collapses.

About the author:

Pankaj Sharma, Country Head, MGID India