When it comes to ad targeting, contextual intelligence is changing the game

Peter Wallace, EMEA Managing Director at GumGum, explains why contextual targeting is reshaping boundaries in the online ecosystem

The clock is ticking on third-party cookie-enabled advertising. According to new research by Gartner, 65% of the world’s population will have its personal data covered under privacy regulations by 2023 – a sixfold jump from today.

The impact of new laws echoing GDPR coincides with a browser clampdown on third-party cookies: 40% of cookie inventory has already been wiped out since Apple and Firefox introduced blocking measures.

Clearly, a once-staple industry tool that generated billions of dollars in online ad revenue is on its way out. But advertisers bracing themselves for the changes ahead can take comfort in the fact that another, privacy-friendly approach to digital advertising is increasingly taking up the reins left by the cookie - contextual advertising.

Up to this point, the power of contextual targeting - where ads are served based on the relevance of the text, image and video-based content on individual web pages - has gone largely untested. But a striking new study from GumGum offers empirical evidence on the level of accuracy it brings to digital advertising, as well as the benefits of contextual over behavioral-based targeting.

The survey was conducted by an independent researcher in partnership with Dentsu, which ran live campaigns for four of its major brand clients. A rigorous experimental format was designed to leverage behavioural versus contextual advertising technology in terms of cost efficiency while benchmarking the accuracy of four of the industry’s leading contextual intelligence providers – including GumGum’s contextual platform, Verity.

The results showed that, taking into account CPMs, contextual intelligence in-demo impressions (eCPM) cost 29% less than behaviourally targeted in-demo impressions. GumGum Verity went further, outperforming its contextual competitors with a 36% cost reduction in eCPM. 

At a time when brand integrity has become a flash point for campaign managers, the study also found GumGum Verity is taking a commanding lead for contextual accuracy in ad placements. Crucially, the machine learning technology underpinning Verity analyses content within web pages on a deep and granular level - including images, video and human-level understanding of the text - allowing for much greater audience targeting accuracy and a more advanced approach to brand suitability.

What do these results tell us? Even setting aside the privacy elephant in the room, third-party cookies are not the powerful be-all we imagined them to be. With contextual intelligence added to the mix of targeting capabilities, advertisers are far more likely to connect with the right audiences at the right time, and in a cost-effective way.

And with brands facing renewed scrutiny from regulators and consumers alike over privacy, contextual intelligence may be the option that reshapes the game: a nuanced and privacy-friendly tool that now, thanks to our study with Dentsu, has measurable effect.

You can read the full study here.