As advertising week looms, ad context is making a comeback

OCT 13, 2021

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Sometimes advertisers say the darndest things. Advertiser Perceptions, a leading research firm on the advertising industry, recently joined with publisher MediaPost to survey 300 marketing and advertising agency professionals to gauge their current perspectives on future industry trends. What I found most intriguing was that just a year from now they expect that more of their targeting of ads to digital audiences will be through contextual rather than behavioral targeting.

I know – the jockeying between contextual and behavior ad targeting doesn’t quite have the historical significance of the debate between nature and nurture. But for the media advertising world, it feels like the relative importance of advertising context has been under siege since the dawn of the digital era. Has the tide turned?

Today, the group surveyed by Advertiser Perceptions uses more behavioral than contextual targeting techniques to reach digital audiences. But their expectation is that by next year that will be reversed, with a preponderance of their targeting to be done through contextual targeting. That’s good news for folks who still make their living making, buying, and distributing content.

In some sense this is a “dog bites man” story in that advertising linked to surrounding content has been the linchpin of advertising from the earliest days of the newspaper business. Marketers placed their ads in newspapers and later on radio and television adjacent to content that attracted the type of audience they were looking for. You want high-net worth, college educated professionals? You knew you’d find them in The Wall Street Journal and CNBC.

Contextual advertising is the digitization of this very old concept, synthesizing more precise data on underlying content elements and the audiences consuming it. Criteo, a long-established digital advertising company, identifies “category” contextual targeting as one that creates pre-set categories of content in which to advertise, “keyword” targeting in which ads are linked to specific content keywords; and “semantic” targeting that uses artificial intelligence to evaluate and categorize each page (or each video segment) of content as a whole.

Despite the longtime comfort with buying ads linked to their content environment, behavioral targeting has been the cool kid of the ad block since the advent of digital advertising. If anyone referred to “targeting” in digital, they probably simply meant targeting based on consumer behavior. It made so much sense, leveraging the readily available data on where consumers went online, combined with personally identifiable information and actual purchase made through credit cards and loyalty programs. It just seemed so much more efficient than the shot-gun approach offered by print and linear electronic media, where you’d “spray and pray” that you reached the subset of the overall viewing audience that might be moved to action by your particular ad. Willie Sutton was famously asked: Why do you rob banks? His response? “That’s where the money is.” Why target individuals based on their behavior? Because that’s where the money has been.

The shifting priorities of the Advertiser Perceptions survey participants reflects the waves of concerns with behavioral targeting that have slowly eroded the attractiveness of the that sandcastle. Procter & Gamble, often a bellwether for big-time marketers, made a loud public point of pulling Facebook ads in 2016, expressing concern about having P&G PG +0.2% ads running next to violent, extremist or otherwise offensive online content. P&G has been one of many marketers expressing concerns about breaches of customer and corporate data and widespread fraud in the targeting of digital audiences.

By 2019, even a pillar of tech publishing, TechCrunch, admitted that “no one likes being stalked around the internet with advertisements.” And maybe most horrifying of all for the free spending digital marketers, there was the growing concern about the effectiveness of such behavioral targeting to begin with.

The biggest gathering storm is coming from government. Although much of the focus has been on the behavior of digital giants, there is a sweeping development of heightened privacy regulations which began in Europe and has been spearheaded in the U.S. by California. Facebook’s whistleblower Frances Haugen has captured headlines around the world. This is hardly a partisan witch hunt, with activism across the political spectrum.

The digital giants have responded, with Google GOOG +0.9% announcing the end of people-tracking cookies (now scheduled for year end 2022), the very foundation of online behavioral targeting. In the mobile environment Apple has already implemented its privacy changes, requiring consumer opt-in for sharing data through most apps. These guys haven’t found the fountain of altruism – the changes will hardly put a dent in Google or Apple’s business – but they do reflect a long-building concern about tracking online behavior.

Given all of this, why didn’t we see this advertiser thinking shift earlier? In part, you’ve got a notoriously change-averse industry. But more than anything, marketers and agencies are finding alternatives that will work. The explosion of streaming with advertising seems like it’s been around forever, but three years ago, who had heard of Tubi and PlutoTV never mind spent money with them? In the last two years every major media company has made significant investments to produce and deliver their highest quality content to services that not only require a subscription, but that rely on advertising as well. CTV was made for contextual advertising by combining digitally precise data with the traditional allure of sight, sound and motion. And NBCUniversal, Discovery, the Interactive Advertising Bureau and others have sought to rally the industry to a new generation of measuring advertising performance.

There is a massive amount of work to do in driving advertising buyers and sellers towards a different digital advertising future, especially one that re-asserts ad context at the forefront. But with momentum building here, folks rooting for the link between content and advertising, in the immortal words of Lloyd Christmas, can fairly ask: “So you’re saying there’s a chance?”