Contextual advertising is a marketing tool that allows Internet users to display advertisements relevant to their interests. Relevance is the correspondence of result and expectations. For example: you entered the query “buy iron” in the search box. And the system immediately gives you a whole list of options with links to online stores. The topmost snippets — results of a search in the form of a small excerpt from the text information of the site will be indicated by a small marker “Advertising”. In different search engines, the marker looks different. For example, sometimes it can even be reduced to 2 letters “Ad” (in the English version of the browser). For example, this is what contextual advertising looks like in Google search results at the time of writing:
Basic terms and concepts
On the territory of Runet and Ukrnet (the Russian-language and Ukrainian-language Internet are abbreviated as such), 2 search engines are the most famous and demanded: Google and Yandex. Placement of contextual advertising is one of the main sources of their income. Especially for managing ads and interacting with advertisers, 2 systems were created that are part of global corporations: Google Adwords and Yandex Direct. Basic operating principles are common to both systems. We’ll take a closer look at Adwords and Direct in future articles.
So, to get a closer look at the work and effectiveness of contextual advertising in general, you need to remember a few definitions:
A teaser ad (abbreviated TA) is the text that the advertiser creates. The advertising system shows the TA to the user. As a rule, the text contains a link to the advertiser’s resource, but there is an exception: a variation of Call-only advertising, which instead of the link contains only the phone number of the company.
CTR (Click Through Rate) — an indicator of the effectiveness of an advertisement. It’s very simple to find out. You need to divide the number of impressions by the number of clicks (clicks) by the link in the advertisement. The more often users click on an ad, the higher its CTR. But not always a high CTR is good. An ad can be intriguing (for example, “Come and see Madonna’s candid photos”), users will often click on it, but clicks will not bring any result.
Conversion – a specific action on the site that is desired by the advertiser. The user can make it after switching to the advertised resource. A conversion is considered to be a purchase, filling out an application, chatting, phone calling, etc.
СРС (Cost Per Click) — the amount that the advertising system withdraws from the advertiser’s account when the user clicks on his advertisement.
Contextual display auction
We already know that contextual advertising can be shown to the user as a result of search results. Such a CA is called search engine. The reason for showing this or that advertisement are the so-called “keywords”. If the user’s request matches the keyword phrase, then the advertisement is included in the output. If not, it is ignored. The advertiser sets the list of desired keywords in the settings of his account.
Google Adwords and Yandex Direct use an auction system to determine CAs that are “worthy of honor” of an impression. A brief principle of the auction can be formulated as follows: the more you are willing to pay per click, the more chances your ad has to get to a high position. It’s not so simple. In addition to pay per click, impressions also check ad quality, CTR, landing page quality, and query relevancy. The system takes into account all these characteristics during the distribution of advertising results, or in other words depending on the results of the analysis, makes a decision: which advertisement from which advertiser to show in the 1st, 2nd, 3rd, etc. place.
Varieties of contextual advertising
Contextual advertising can be search or displayed. All of the above examples are mainly related to search advertising. What is media CA? These are banner ads with text and pictures, sometimes also with animations, which are displayed on partner sites of the search engine. Displayed advertising is a source of income for many sites. The resources that host ad units are part of a network of search engine partners. Yandex has the name of the YAN system (Yandex Advertising Network), and Google has the GDN (Displayed Network). Displayed ads can be shown to users based on their specifics. For example, you can highlight individual audiences:
- by gender;
- by age;
- by region;
- by interests (news readers, sports fans);;
- by search history.
The list does not end there. You can also select specific sites by the domain of the site, or by subject, and place your ad only there. An example of media CA on a popular site:
Convenient pay-per-click system, advanced functionality of search engines and the possibility of full control over efficiency and expenses make contextual advertising a convenient tool for business. Website development, its promotion and CA is the key to the success of a business on the Internet. We hope that after reading our article you have found the answer to the question “What is contextual advertising” and have mastered the basic concepts associated with this term. In the following publications, you can learn more about the Google Adwords and Yandex Direct systems.
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