Contextual vs. Behavioral Targeting: Building Trust and Revenue in a (Third-Party) Cookieless World

Behavioral targeting, otherwise known as user targeting, has been the backbone of programmatic advertising for a while now. Yet, consumers are simply annoyed by the state of advertising. 

Because ads have become more common, frequent, and irrelevant, it’s led to over 40% of users deeming ads as too aggressive. They’re also considered a breach of privacy and why one-quarter of US consumers block ads. Now, despite continuous data regulations and advertising getting a bad rap, there are still alternatives to traditional third-party cookie-based behavioral targeting. 

You can create better ROI on your ads by serving an accurate, informative, interactive, and custom-made ad (or at least made to feel that way). This is where contextual advertising can support unique content creation that can be used to display content-related ads that attract a user. And while good content takes time and effort, knowing your audience and what piques their interest is the best place to start. 

As the industry shifts to a new way of buying and selling media, advertisers will need privacy-compliant first-party data to understand their audiences and interests. For example, with publishers understanding each website visitors’ behavior, they can provide information such as what a user is interested in, how long they spent on a page, how often they visited it, and their overall browsing habits. 

That’s where first-party data helps publishers achieve advanced audience segmentation and activation. It’s how publishers improve user experiences by targeting them with more relevant content that, in turn, attracts compatible advertisers. This creates a holistic strategy to serve audiences content and ads that genuinely engage and build loyalty. These direct buy and sell-side relationships will resolve several issues in today’s complex advertising landscape. 

What’s Behavioral Targeting?

In behavioral advertising, audiences are segmented according to their online behavior. It includes tracking their browsing habits, search history, clicks, and purchases. This determines the ads served to them and creates other audience segments with similar behavior for targeting with relevant content and ads. 

For example, travel and retail sites frequently use this method for brand awareness and retargeting ads. Let’s say you’re planning a trip to Arizona and browse a site looking for hotels. Not only would you get hotel ads popping up, but you might also be seeing ads about local sights like the Grand Canyon — rather than a coffee shop in Thailand. This can only happen when a sophisticated system is used to paint a picture of a user’s inferred interests and intents to target them effectively. Ultimately, it also increases the chances of making an impulsive purchase. 

While behavioral targeting has been the default in the programmatic world, with the deprecation of third-party cookies, it’s time to consider other targeting methods such as asset profiles and contextual targeting. 

What’s Contextual Targeting?

Contextual targeting is when an ad appears based on the environment rather than user behavior. For example, publishers can use keywords, website content, and metadata to attract advertisers. By placing contextually related ads alongside content, users can be delighted in real-time.

Contextual targeting means that audiences are generally receptive, leading to more qualified leads and higher conversions. Contextually relevant ads are 10% more engaging than the article content and can increase purchase intent. Critically, it’s privacy-safe and compliant because it’s based on content rather than user data. No third-party cookies are needed. As a result, publishers can create and activate high-value audiences for advertisers. 

Combining Behavioral Targeting with Contextual Targeting

Consumers don’t like ads, but they love content. And customers are open to having relationships with brands who bring them value by serving them ads they want and can be entertained by. As more decline to opt-in for tracking, publishers need a better way to leverage their audiences, which comes from working with asset data instead of solely relying on user data.

First-party data owners need robust databases to find the best audiences. Themed content or subscriptions are some ways to resolve low data issues. Campaign performance data can also measure and identify user attention to achieve the best advertising results. That’s why publishers need to work with advertisers to build relevant segments or publisher cohorts. 

By combining behavioral targeting with contextual targeting, you can put privacy-compliancy at the forefront while still targeting similar groups based on characteristics and behaviors without compromising their identity. In addition, publishers who use first-party data to build cohorts can allow themselves to provide advertisers with added value, increased relevancy, and privacy ethics. 

A high-performing, first-party data management system can integrate user and contextual targeting into one solution. By mixing content analysis (such as web, TV, and radio channels), behavioral analysis, and data ingestion (i.e., CRM, ad logs, and logins), you can create a user and asset profile. The user profile provides user-centric targeting and analytics such as gender, age, education, and interest. An asset profile offers context-centric targeting that includes analytics such as type and category, gender and age, and usage and device. 

With real-time technology, publishers can create first-time visitor segments through asset profiles that use the profiles of prior site visitors to create a collective profile for a content asset. Now, publishers can have richer profiles and complete any missing data to make highly accurate targeting and predictions rather than solely focusing on keywords. 

How 1plusX Helps Publishers Build a Privacy-Compliant Assets Targeting Strategy

There’s no need to settle for non-privacy-compliant behavioral targeting or rely solely on keywords and context with contextual targeting. Instead, you can get the best of both worlds by using 1plusX’s audience segments and classifications to go deeper. Here’re a few things to consider and how 1plusX’s data and audience management solutions can help:

• Align the customer journey from top to bottom. Publishers should manage their users, consented data, and ad sales holistically. This will allow publishers to create a strong relationship with audiences and build a value-added bridge for advertisers. In addition, a cohesive first-party data strategy will ensure global privacy regulations are met. 

• Create contextual audience profiling segments. You don’t need third-party cookies to gain deep user insights. With the right data management platform and first-party data strategy, publishers can create explicit audience segments that work for them. Keep in mind this isn’t a quick fix. Like most targeting tactics, you’ll need to experiment with topic categories and keywords to optimize your efforts and know which audience or channel works best. Your own benchmark is the best benchmark to work from at the end of the day.
• Address brand safety and suitability. Every advertiser wants to ensure that their ads appear alongside quality content that generates a lot of traffic and engagement. On the other hand, any marketer’s last thing is to damage their brand with inappropriate placements. Therefore, publishers need to consider how to manage brand safety. It’s critical to build advertiser trust with topic tools that can quickly identify and exclude unwanted or irrelevant content.

Big data and effective first-party data management are what power contextual targeting. But you also need to understand your audiences’ behavior which can be done with the right tools to build, segment, and activate the right audiences at the right time. With our AI-powered data management capabilities, contextual targeting highlights what interests your audiences most — without relying on third-party cookies. As a result, publishers and advertisers can deliver the most relevant and personalized content and ads, helping build audience trust, loyalty, and conversions. So set up a call, and we can show you how.