This post is broken up into two parts:

• What are contextual ads? (with examples of good and bad matching)
• Contextual ad networks

What are contextual ads?

Contextual ads are online ads that include code that enables the ad network to spider the page’s content, determine its topic from a preponderance of the keywords and meta data, and serve up ads relevant to the page’s topic. Or, more simply, contextual ads are ads that match the page’s topic.

So, if a page is about treating a cold naturally, the contextual ads are likely to include links to alternative cold remedies and the like. There are varying degrees of sophistication, but most match ads well enough to content so that click-through rates are far superior to demographic- or geo-targeted advertising solutions.

How does it work? When a publisher places a contextual ad tag on a page and publishes it, the code instructs a bot that indexes the page and determines the topic of its content. That information is passed to the ad server, which selects an ad to display in that spot that provides the best contextual match, against any other requirements (size, site restriction, frequency/budget caps, etc).

Here’s an example from HubPages:

The contextual ad matches wrinkle cream ads to the article on natural face creams, because, presumably, people interested in reading an article on natural face creams are more likely than the average Internet user to respond to that sort of ad.

Contextual ads are not always text-based; banner ads, as long as they’re properly tagged in order to categorize the creative, can be matched contextually. Google AdSense is one contextual ad network that does provide contextual matching for display (image) ads.

Contextual matching does not always work perfectly. As demonstrated in these cringe-worthy examples posted on Mashable, sometimes a simple term match doesn’t do the trick:

It’s easy to imagine other, more innocuous but equally ineffective matches (ads for Mrs. Field’s showing up on a page on how to clear your browser cookies). Two contextual advertising firms (Proximic and Peer39) have come up with methods that purportedly minimizes the likelihood of these kinds of semantic/lexical mismatches.

Contextual Advertising Networks

The contextual ad network space is dominated by Google’s AdSense,  the publisher’s earning solution side of its advertiser solution, Google AdWords (which also places ads on Google’s SERPs).

Here is a list of contextual advertising networks:

• Google AdSense
• Yahoo Publisher Network (YPN)
• Microsoft PubCenter (AdCenter Publisher)
• Chitika
• Kontera
• Quigo
• Vibrant Media
• LookSmart
• Peer39
• Proximic
• Ask.com Sponsored Listings (ASL)
• Ad-in-Motion
• LucidMedia (upcoming)

This entry was posted on Tuesday, December 23rd, 2008 at 12:55 pm and is filed under Online Advertising. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.