Behavioral Versus Contextual: Why Choose Only One?

  |  November 4, 2004   |  Comments

Behavioral targeting can enhance contextually targeted ads and vice versa. So why make it an either/or debate?

The recent rise in interest in behavioral targeting has prompted a series of mini-debates on implementation issues by publishers and advertisers. Issues have ranged from whether there should be industry efforts to standardize audience segments to how much will be spent in this sector and how best to protect consumer privacy. We've all heard the debates -- many issues have been discussed on ClickZ.

Recently, in conjunction with meteoric growth of automated contextual networks, there's been a considerable amount of discussion as to whether behavioral targeting might eventually replace content-based targeting altogether. Some argue the relevance and results that behaviorally targeted ads can deliver is so powerful, content and context-based ad placements will be supplanted and replaced.

As someone who's worked in one form or another of behavioral targeting for almost six years, I'd love it if this were true. Without hesitation, it isn't. No way.

Behavioral targeting has no chance of entirely replacing contextual targeting. Not by a long shot.

I don't even understand why people argue there should be a showdown between behavioral and contextual and to the victor go the spoils.

Behavioral is proving to be very powerful, particularly over recent years. Contextually targeted advertising has been establishing itself for decades. Editorial adjacency, in which ads are inserted into media in a way that makes them relevant to the adjacent content, is the hallmark of the media industry and very powerful in practice.

There's no better place to reach tennis players with tennis-related marketing messages than to advertise in TENNIS Magazine. Not only is the audience composition fantastic, associating an advertiser's brand with certain media brands or with certain types of content can be enormously powerful. To discount place-based targeting's value because new techniques deliver person-based targeting misunderstands the media business.

Content-based targeting has a number of limitations. Within most traditional media properties, there's very little ability to do any audience segmentation. That doesn't mean simply delivering messages within the proper context isn't still very powerful. It certainly is, and that fact continues to justify several hundred billion dollars of advertising expenditure each year.

Behavioral and contextual targeting will neither fight with nor supplant one other. Instead, they'll complement each other. Each tactic on its own can create tremendous value for media companies and marketers. Together, they can become even more powerful.

The whole can be greater than the sum of the parts. Consider this example:

It's well known that much of the content on the Internet doesn't work well for contextual targeting. On many pages, it's almost impossible to determine a commercial context with any specific focus. It's hard to contextualize home pages and section fronts. These tend either to be very general or contain stories that go in eight different directions. These are very unlike a page about tying flies, on which you're certain fly-fishing equipment ads would be relevant.

How big is the problem? Some say over 75 percent of all content that's currently run through contextual networks has this problem. That's a lot. It represents tens of billions of monthly page views.

What to do? Simple. Use behavioral targeting. When publishers and networks have pages that can't be commercially contextualized (what a term!), they should consider the historical surfing or registration information they have on that visitor, and target the ads. Behavioral and contextual marketing can balance and help each other.

When publishers and networks with behavioral targeting don't have a visitor profile, their systems should default to a contextual ad. In the end, which technique to use, or whether to use a combination, should be made on a yield management basis.

The systems are complex, but the logic isn't. A publisher should deliver the highest possible value at all times. Sometimes, it's a fixed position sponsorship. Sometimes, it's a behaviorally targeted ad. Sometimes, the ad will be contextually targeted.

One thing's certain: Publishers who can only deliver one or the other technique will never truly maximize revenue.

Don't select either behavioral or contextual targeting. Choose both.

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ABOUT THE AUTHOR

Dave Morgan Dave Morgan founded TACODA Systems in July 2001 and serves as its CEO. TACODA is a pioneer and leading provider of behavioral-targeted online advertising solutions for driving quality branding relationships. TACODA delivers advertisers high quality, targeted audiences from premium sites, powering successful online advertising campaigns. TACODA-enabled Web sites, which number over 2,000, reach over 70 percent of the U.S. Internet audience monthly. Its roster of customers, mostly Fortune 1000 business, includes branded national, regional and vertical sites, and 75 percent of the top 20 U.S. newspaper companies. Customers include the New York Times Digital, Weather.com, iVillage, Gannett/USATODAY.com, The Tribune Company, Belo Interactive, BusinessWeek.com, About.com, Advance Publications' Advance Internet and Forbes.com. Virtually every top 50 online marketer has run campaigns on TACODA-enabled sites, including travel, automotive, packaged goods, consumer/health products and consumer electronics companies.

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