Contextual advertising within the PPC mix

Pay per click (PPC) advertising has become a central part of the digital marketing mix and has enjoyed massive year on year growth since its inception. However, despite the global adoption of this unique and lucrative form of advertising, there are still untapped territories within the paid search offering. One such area is the content match or contextual element offered by most of the major networks (Google, Yahoo!, MSN Ask).

So what is it?
Contextual advertising is a feature that allows adverts to appear on relevant sites, (i.e. sites containing content relevant to what is being advertised) in a form more akin to traditional banner ads than PPC links. Although contextual search has yielded low returns in some industries, it has proved very effective in others. Gambling, Recruitment, Finance and Publishing are four key sectors that thrive in the contextual arena. IDG, one of Greenlight's publishing clients, sees almost all its traffic coming through contextual advertising. The advertisers that succeed in contextual also see it contributing in a big way to the overall ROI of their digital marketing campaigns, quite often producing the highest return in comparison with other online media purchases.

So, we know how contextual ads differ to search ads, but how does contextual differ from network to network? Google Adwords offers two sides to its contextual feature. These are content and site targeting. Content targeting is opt-in and the sites that advertisers appear on are selected by Google based on relevancy to ad groups. Site Targeting is very similar, but sites can be chosen and eliminated manually. Yahoo! and MSN offer more simplistic contextual targeting, with both networks automatically selecting sites based on relevancy. Miva is the only network that utilises and offers only contextual advertising.

The major advantage of content targeting is the price of the clicks. Advertisers that do well in this channel often see CPC's (cost per click) of well under 10p. Also, because the competition for high positions is not as fierce as on search engine results pages, these prices will generally secure high rankings.

So what are the drawbacks?
The drawback of contextual is that it's not easy to see where your clicks and sales are coming from. While Google has recently added reporting, which shows exactly which sites are driving the traffic and conversions from content targeted contextual ads, we still await this essential information from other networks. Generally speaking, the other networks keep their partnerships private and therefore advertisers are very much in the dark as to the source and quality of leads.

Another concern is simply the amount of available inventory. Many advertisers find that they get a huge number of impressions from contextual, but only a tiny amount of actual clicks. This is in large part to do with the fact that the ads are unsolicited in contrast to search where they are the sought content itself. Furthermore, it affects certain advertisers more than others. For retail advertisers it is often even more pronounced because the user is generally in research mode looking for content rather than actual products. In contrast, publishing clients thrive for this very reason where the viewing of the content is, more often than not, the desired end result. If an advertiser is not as successful in terms of clicks and sales, then the content network could be looked upon as a branding tool. It can only enhance your brand's visibility if you're receiving thousands of ad views every day, even if those ad views don't convert to clicks.

How is it being improved?
Although contextual advertising is little talked about, it is fair to say it has produced improved returns for the right type of advertiser over the last year or so while the service itself has been continuously upgraded and streamlined across the various networks. Google, in particular, has improved its range with the site targeting facility and new relationships with high traffic partner sites. Yahoo! has also developed a partnership with CNN and other major international news sites. MSN meanwhile, is still very new in the search space, but has made a commitment to place greater importance on contextual advertising within its main product offering.

The future
The future of contextual advertising, like paid search in general, is difficult to predict. It's certainly plausible to say that it will continue to grow and develop at a comparable rate. However, it could veer off in a number of different directions due to the wide ranging results it achieves from sector to sector. It could also provide the platform for any behavioural targeting that the networks might choose to develop in the future as this becomes more prominent. One thing is for sure, as advertisers increasingly look for additional revenue streams away from pure search, contextual will grow to become a staple component of the digital marketing mix.

PPC as a combined medium is growing at an incredible rate with contextual being an integral part of that. Fundamental developments occur on a weekly and even daily basis. In the last twelve to eighteen months alone, the major networks have introduced mobile advertising, map advertising, image ads, video ads, pay-per-call, click-to-call and even branded payment functions such as Google Checkout. All of these features can and should be utilised by the advertiser where applicable, in order to create a balanced and synchronised online presence.

Ultimately, PPC should not be thought of as one dimensional. There are multiple avenues within the medium that can be considered in order to target customers as widely and specifically as possible. In a similar way, search is not static and will continue to move at a rapid pace over the coming years. Advertisers that keep up with developments, select the most relevant tools for their product or service offering and use them to the fullest potential will be the clear winners.

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