The Contextual Marketing Opportunity

Contextual marketing grew out of the search space and had graduated into an industry in itself. Instead of paying top bids for a term on a search engine, now there are providers who can scan a page in milliseconds and combine this with appropriate advertising. ROI can be higher because click prices are lower, click rates are often lower, and conversions are higher because the readers are in the right frame of mind. A lot of contextual marketing gets into why a customer is reading a certain page and where they are in the purchase stage. Moderator Dave Evans (GSD&M) and panelists Barry Briggs (CNET), Andy Jacobson (ContextWeb), Erik Matlick (Industry Brains), and Dave Ellett (Powered) spoke to a packed house.

Andy Jacobsen explained how real-time targeting to reach the audience and making text ads look like content greatly improved the CTR on ads. I can see this, but I also wonder if there are issues when you fool your readers into thinking that advertising is content. There are issues of journalistic integrity and site reputation at stake when you make the advertising indistinguishable (or at least very close to) your actual content.

Eric Matlick noted that contextual advertising is nothing new, and that it was a $2B industry in 2003. He also commented on a comScore study that showed that buyers searched two or more weeks in advance of purchase, and only 18%-28% used brand names in their searches.  This shows that there are many opportunities to influence buying behavior during the consideration phase of the buying cycle. Eric also stressed that real time contextual ads work best with targeted, special interest sites.

Dave Ellet explained their Educational Marketing Platform. Their idea is that an educated consumer buys more. Instead of providing all the information up front or on a Web site for the buyers to read through, they provide a sequential course sent to the user over a course of weeks to educate and market to them as they go. Most surprising, the education does not have to stop at the purchase phase. After the purchase, education on how to use and what accessories are helpful can drive additional purchases.

Barry Briggs had the view of the publisher and his comment was that it is the users experience with the brand. “Do it wrong, and they don’t come back” was his warning.  They take into account what they know - or don’t know - about the user to tailor the message. Unknown users may get a broad range of information, contextual ads, similar products, reviews, etc. to expose them to as much as possible. Known users can be marketed to based on user intent and in some cases through clustering based on participation in multiple areas of a site or network of sites.

When asked to look at the future, Barry mentioned the need for research into tools and metrics. Also mentioned was the potential from behavioral networks, RSS, and email newsletters. As they get to know users more, there is more to have to figure out. The challenge will be how to make the information scalable to be useful.