How Does Contextual Targeting in Programmatic Work?

Last Updated on: 24th April 2024, 10:48 am

Although contextual targeting is nothing new, its combination with the potential offered by programmatic can open up completely new possibilities for almost every company. Take the execution of marketing campaigns to a whole new level. Support the achievement of assumed objectives and at the same time ensure the effective use of the budget allocated for this purpose. How does contextual targeting in programmatic work? What benefits can be expected from combining the two tactics?

In this article you will learn about:

The role of the Supply Side Platform and Demand Side Platform
Methods of targeting potential customers
Combining contextual targeting with the use of automated advertising tools and its benefits
Building a marketing strategy step by step

Table of contents:

What is programmatic advertising?
How can you target your potential clients?
Contextual targeting in programmatic – what does this mean?
How can you build a winning strategy using contextual targeting in programmatic?

What is programmatic advertising?

Every marketing campaign has a specific goal to achieve – usually sales or brand visibility. It also has a limited budget, which to a large extent defines its scope, the creatives used or advertising channels. Constant monitoring of the budget as well as constant campaign optimization are key success factors. It is not hard to guess that, especially in the case of large and wide-ranging campaigns, the implementation of this task is extremely difficult and time-consuming.This is where programmatic advertising comes in. How does it work and how is it better than the traditional model?

In the traditional model of buying display advertising space, the advertiser has to reckon with high dependence on the publisher. It is necessary to find such a publisher, agree on the conditions and finally provide advertising creations to be placed on the website. Further steps lie solely with the publisher. It is the publisher who sets up the advertising campaign on their ad server, adjusts the ad impression plan and guarantees its implementation. Any optimization of the campaign also requires the publisher’s participation, which, of course, is very time-consuming and tedious.

Programmatic advertising effectively addresses the shortcomings of the traditional model and shifts campaign execution from the publisher to the advertiser. It eliminates middlemen and gives marketers more control over their campaigns and flexibility that helps in achieving the set objectives. The role of the publisher, or more precisely its ad server, is being replaced by two platforms:

SSP (Supply Side Platform),
DSP (Demand Side Platform).

The first one is used by the owner of the medium – they define their advertising placements and generate an advertising script for each of them, which is then plugged into their website. DSP, in turn, serves the advertiser. It is here that they upload their advertising creations and plan advertising activity for them. Both platforms are linked via an ad exchange system, which combines and processes information from both sides and thus enables the purchase of advertising space.

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How can you target your potential clients?

While it is true that buying adverts and optimizing advertising campaigns is a great help and a chance to achieve satisfactory results, you should not forget about targeting. In order for an advertisement to achieve its goals, it must reach a specific group of recipients – those who may be interested in our service or product. Reaching the wrong users with an advertising message is the most common mistake and the fastest way to burn through an advertising budget. How can you target potential clients? There are three basic methods:

Sociodemographic targeting

A method that involves defining a target group using specific socio-demographic criteria – e.g. gender, age, place of residence, family situation or income. Years ago it was very popular, however today it is taking the back seat to much more effective and precise solutions.

Behavioral targeting

There’s no denying that personalized marketing is much more effective than sociodemographic, which is why behavioral targeting is very popular. The idea is simple – it consists in reaching the recipients on the basis of their previous behavior (e.g. visits to the website, purchases made or links they clicked on). Using behavioral data in targeting allows you to create much more personalized ads that resonate better and thus build better relationships with potential customers.

Contextual targeting

The key to success in the competitive world of online advertising today is to get the right advertising message to the right person at the right time. Contextual targeting, which is commonly used, for example, by search engines, is the most effective way to achieve this goal. They select advertising content according to the keywords entered by the user in the search bar. This works similarly when visiting a specific website, but the signal retrieved here is not the keyword, but the website’s URL, content category, text itself, and even images – anything that can reveal the user’s goals, plans and interests.

If the content being viewed by the user suggests that they are looking for vacation flights and are planning a vacation, they will be presented with ads that are likely to attract their attention – offers of travel agencies, travel insurance or accessories useful on vacations. There is no coincidence here, thanks to which the chance of conversion is incomparably higher than in the case of other targeting methods.

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Contextual targeting in programmatic – what does this mean?

Is there a way to combine the benefits of precise, contextual targeting with the use of automated advertising tools? Of course – this is what contextual targeting in programmatic is all about. In fact, it’s the natural evolutionary path for these tactics. The criteria resulting from contextual targeting can be transferred to the DSP platform and the right ad space can be purchased and presented in the most appropriate place.

The benefits of this approach are really the sum of the benefits behind each of these solutions. These include:

better matching of ad creatives to the context of the page or search;
the ability to ensure the right neighborhood for your ads (brand safe);
contextual targeting is privacy friendly – the user remains anonymous;
the space purchase process is automated and efficient;
greater chance of achieving the set goals while optimizing the budget.

How can you build a winning strategy using contextual targeting in programmatic?

Building a marketing strategy that will allow you to achieve your goal or group of goals is not an easy task, so it is worth breaking it down into first factors and specific tasks to be performed. Where do you begin?

Set your goals and priorities

Defining your goals is the first and most important step. Why? Because each goal has a slightly different path to follow. Specify whether you want to increase sales, win back lost customers or increase brand awareness. Think about the metrics that will allow you to measure the achievement of each goal and take appropriate action when progress is not fully satisfactory. Don’t forget to set a budget, but make sure it is agile. Contextual targeting in programmatic will undoubtedly help you achieve your goals more effectively, but the starting point is always to define them properly.

Find a partner for the Project

Getting good results takes practice, lots of experimentation, and different approaches. While you can go it alone, it makes more sense to invite experts to the project that know exactly how to get the most out of contextual targeting and programmatic. Their experience will certainly prove invaluable. They will help you avoid a number of mistakes and unnecessary costs.

Create engaging ad content

Thanks to contextual targeting and the fact you address your ads precisely your chances of conversion are really high already, but this doesn’t mean you don’t need to look after the ad content. In order to resonate with your potential customers, your ads need to be professionally prepared – they need to attract attention, be interesting and engaging. Take advantage of your previous experience and the recommendation of a partner invited to cooperate with you, and create the most engaging marketing message possible. Remember that advertising is not only about banners – do not be afraid to use video or native advertising.

Choose the best targeting strategy together

Make sure you reach your potential customers as precisely as possible. You already know that you’ll get great results by using contextual targeting, so be sure to take this method into account.

Execute your strategy, continuously monitor KPIs and adjust if needed

Do you know the goal of your campaign, who you want to target and how to implement it? Start acting! But remember to continuously monitor your progress. Specify the KPIs established at the beginning and monitor the situation. Contextual targeting in programmatic is really powerful and can help you use your marketing budget wisely, but your operating strategy is unlikely to be perfect right from the start. Don’t be afraid to modify your assumptions if they turn out to be wrong – take the right steps and optimize if necessary.

Don’t be afraid to experiment and test new strategies

The campaign is going great, the results are satisfying, and the chances of reaching your goal are increasing? Remember to be flexible. Don’t be afraid to experiment. You never know if a different strategy might not turn out even better. Be flexible and don’t limit yourself too much in your actions.

With the abandonment of cookies and the increasing focus on privacy issues, contextual targeting is likely to gain importance in the near future. As a natural consequence of the growing popularity of this form of targeting, it will become more and more common to combine it with programmatic in order to achieve marketing goals even more effectively and use the available budget in the most rational way possible.

The key to success, however, is the proper understanding of the mechanisms behind these methods and the use of modern technology (e.g. Deep Learning) to work even faster and more efficiently.

If you have any questions, comments or issues, or you’re interested in meeting with us, please get in touch.

What is Contextual Targeting in Programmatic?

What is programmatic advertising?