Practical Ecommerce

Contextual Advertising: What You Need to Know

If you have considered using contextual advertising through a Google content network — or any other venue — there are a few things to consider before you give it a try.

Contextual advertising is what you experience when ads based on the content of a web page you’re viewing dynamically “appear” without external prompting. This usually takes place in an automated or partially-automated manner. The ad management system “sees” you are viewing a page about kayaking, and it “learns” this by examining the words or other elements on the page. The system then provides an ad that’s related to kayaking. That’s the “contextual” part of the equation. (On the example to the left, the “sponsored links” at About.com show ads related to the topic that is on the page — in this case it’s thyroid disease.)

Many analysts say that contextual ads lead to fewer conversions than pay-per-click (PPC) search engine ads due to the problem of timing. There’s no way to calculate how the ad’s arrival lines up with the potential customer’s readiness to buy.

Those who reach your website via a PPC search tend to be further along the sales cycle. This means they are drilling down with more specific keywords, actively looking for businesses that sell the product they want in order to make the final decision.

Given the very real possibility of bad timing, many advertisers might see contextual advertising as a poor choice if the sole intent is to get an immediate return. However, contextual search advertising offers some distinct advantages, as long as the advertiser realizes that conversions will likely be smaller.

One of the main advantages is that keywords in contextual advertising tend to cost less than keywords used in PPC search. Therefore, an ad campaign based on content can cost less, which in turn means that fewer conversions can still result in a decent ROI.

Additionally, one cannot dismiss the value of product and website exposure in any format online, especially in content-rich pages. Typically, visitors who read such content online already have a high degree of interest in the topic. Therefore, they may be more likely to notice your ad or, at least, make note of your website as a possible avenue to explore when they are closer to the end of the sales cycle and ready to purchase.

The following are some tips and techniques to keep in mind as you explore the use of content ads in your PPC campaigns.

  • Run competitive tests between your PPC search and your PPC contextual search ads before you commit to one or the other exclusively.
  • Remember that contextual ads have a different purpose than PPC search ads: They are designed to instill interest in the product, while PPC search ads focus on conversions.
  • Thus, consider developing different landing pages and ad descriptions for each type of advertising.
  • Set up competing contextual ads on different search engines to see which one will perform better for you.
  • Remember to time your testing carefully. It is usually not a good idea to conduct testing of different ad campaigns during the holiday shopping season or even during months when major holidays, such as the July Fourth weekend, occur. The results could easily be skewed and not indicative of “normal” behavior in a more standard time frame.
  • With both PPC search and content, tracking is the key to success. Without knowing what is working and what is not — which keywords convert or at least result in impressions — your ad dollars are being wasted.

Contextual advertising can expose you to thousands of prospects and yield a terrific return. However, remember that it requires its own approach in order to succeed.

Practical Ecommerce

Practical Ecommerce

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  1. Legacy User April 5, 2007 Reply

    While content ads come cheaper, they also receive so much exposure that you can end up receiving an incredible amount of clicks. I tend to tell clients to stay away from the content network due to the fact that I have seen ad spend increase dramatically in a short period of time. Unless you have the money to waste on gaining better brand name exposure on the content network, this can hurt you more than help.

    — *Adam*