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Contextual vs. Behavioral Targeting

Dawn Anfuso
Contextual vs. Behavioral Targeting Dawn Anfuso

In a study that asked adult consumers what type of targeted online ad they are likely to respond to (read: click on), 62 percent cited contextual-- ("a subject of particular interest to you"). That's more than twice the number who said they are likely to respond to demographic criteria (28 percent-- "a specific group you may be a member of"). Just 24 percent of those surveyed said they respond most to geographic targeting ("businesses in your local community"), and 18 percent said they were most apt to respond to behavioral targeting (ads based on "your past behavior on a given website").

Fully one-third of respondents weren't sure or had no opinion on what method moves them most.

Vendare, the ad network that commissioned the national study of 1,000 adults, concludes from the results that subject matter matters most in online advertising. "When you present advertising on top-of-mind topics, consumers respond," says Lynn D'Alessandro, vice president, sales, for Vendare Media's Traffic Marketplace. "Contextual advertising matches your messaging with pages on related topics, and you can't really get any more relevant than that."

Anand Subramanian, CEO of ContextWeb, agrees: "Contextual targeting multiplies the opportunity for advertisers to communicate with the user by messaging different offers to the same user at different times. There are only so many online users, but there is infinite number of online user interests or mindsets. A typical online user may look at more than 10 to 15 different types of content in any given day."

On the other hand, he says, "Behavioral scales with unique users. There are only so many online users making it supply gated, and can therefore only grow as much as the online user community grows. As online advertising gets bigger, behavioral's share of the overall online ad spend will shrink."

That's not to say that other targeting methods should be dismissed, including behavioral. Based on other results that show responses to various types of targeting vary by age groups, economic status and ethnicity, Vendare believes that a mixture of targeting practices is the smartest strategy.

For example, the research shows that those with annual household incomes above $75,000 and those with post-graduate degrees are roughly twice as likely to respond to demographic, geographic and behavioral targeting as their counterparts at the bottom income and educational levels. And women are slightly more likely to respond to contextual targeting than men (63 percent to 60 percent).

Among other findings of note:

  • Response to contextual targeting varies according to racial makeup: 72 percent of nonwhites respond to relevant subject matter, against 60 percent of whites.

  • Those employed part time are significantly more likely to respond to demographic targeting than those in any other employment category (by as much as a 15-point margin).

  • Demographic targeting is nearly twice as important to those in the 35 to 44 age bracket as to those ages 18 to 24.

  • Geographic/local targeting is second only to contextual among those in the West, while demographic targeting is relatively more appealing among those in the Northeast, the Midwest and the South.

  • Behavioral targeting was three times more popular among the 35 to 44 age group than with the 18 to 24 crowd.

"Targeting isn't an either/or decision, so it's best to mix and match targeting tactics-- especially when it comes to educated, prosperous consumers who simply won't respond to messages that aren't personally relevant," Vendare's D'Alessandro says. "If your messaging says 'we know what's on your mind,' plus 'we are you,' 'we are where you live,' and 'we are ready to handle your online needs,' you have four good shots at reaching your best customers."

A mix of targeting tactics does seem to be the best strategy. Preliminary results from a recent study conducted by Next Century Media for TACODA Systems suggests that contextual targeting should be used at the beginning of a campaign but that for subsequent frequency behavioral targeting should be used.

The Tacoda study used eye tracking to compare behavioral targeting to contextual targeting in terms of advertising awareness, branding measures and ROI.

Back to the Vendare study: "This study is interesting in how it takes into account a variety of online advertising solutions instead of focusing on just one," says ContextWeb's Subramanian. "Compared to other forms of online advertising such as search or behavioral, there have not been as many studies on the effects of contextual. I think this study is positive in its ability to look at how consumers view the technology from a user's perspective and draws on many different demographics to generate its responses."

Not everyone in the industry agrees with the study's methodology, however. Bill Harvey, founder of Next Century Media and an interactive media advisor to advertisers, agencies, entertainment and media companies, points out its flaws:

"Asking consumers directly to opine as advertising experts on their own proclivities is a mistake that the traditional media learned not to use decades ago when so taught by ARF, advertisers and agencies," Harvey says. "The reality is that consumers don't even know what behavioral targeting is (many in the industry still don't know) and that makes the consumers-as-experts error even more egregious in this instance.

"Consumers predictably always say that they prefer to be targeted based on their interests because it is obviously in their self-interest to say that. This kind of survey has been done before and nothing new is learned by this.

"The other judgment error here is the implicit assumption that clickthrough is the end-all and be-all whereas about nine out of 10 advertisers are looking for communications effects, a.k.a. branding."

Dave Morgan, CEO of Tacoda, a behavioral targeting network, agrees with Harvey's assessment. "There is a big difference between clicks and qualified audience," Morgan says. "While we have seen research that shows that behavioral can sometimes drive better response than contextual, we have seen the bigger differences when you look deeper at the quality of the users' responses. Behavioral does even better when you look at viewthroughs and conversions and, most importantly, brand metrics like engagement and favorability and purchase intent. We think that it is critical that our industry stop looking only at clicks. It is a misleading and superficial metric."

So what's the bottom line?

As with all studies, results should be taken with a grain of salt. Is there some relevancy to the findings? Of course. It's definitely helpful to know how consumers perceive they're being targeted to, and how they think they prefer to get their information.

Are there flaws to the methodology? Probably. There are always at least a dozen, if not hundreds, of ways to collect, decipher and analyze the data. But that's what provides us food for thought, and keeps us looking at the topics from many angles. We'll continue to cover the numerous studies here at iMedia, and we welcome your thoughts.

Focus on your demographics
Always keep your demographic in mind when determining your subject matter. As authors of the ApplevsGoogle page, the topics we could focus on are endless. But the truth is, we have discarded myriad compelling subjects simply because our audience would not be interested.

Over time, we have come to know and understand our audience, which is imperative to keeping members involved. Our fans gravitate toward posts that discuss the latest technology and cutting-edge tools. For example, anything we posted on the iPad was a hit. See how many comments this simple post generated.

Write it right
You can express the same message multiple ways using different tones and verbiage. Make sure your site's writing speaks to your fans. The ApplevsGoogle page has a young audience, with 60 percent of our users falling between the ages of 13-17 and 24 percent between the ages of 18-24. Because of our demographics, we tend to write posts in an audacious tone. This works great for us but would be far from appropriate for many corporate Facebook sites.

Timing is everything
Posting at the right time is critical for success. With the abundance of information online, people have plenty of site choices. Give them ammo to visit your site by making it timely and relevant, encouraging fans to continue to engage with your page.

Here's an example from our page, reflecting an error with the iPhone. A glitch arose, and we beat the media to the punch, while the issue was fresh in consumers' minds:

Anticipate questions
Although this might sound difficult, the truth is that if you have a solid understanding of your audience and subject matter, you should be able to predict upcoming questions or issues. Anticipating questions and addressing them will position your company as being both informed and involved.

An easy way to stay ahead of the curve is by following the latest industry news and posting relevant stories. We strive to find breaking news and articles that relate to our audience's interests. We share everything with our fans, and they are happy to continually engage with us as a result:

Diffuse a ticking time bomb
All pages have their haters and antagonists, and it's important to diffuse any adverse situations as soon as they arise. I don't recommend removing everyone who goes against the grain, as controversy is good for initiating conversation. As you become more involved in your page, you'll become familiar with the behaviors of your fans and learn how to handle them. If someone is blatantly out to ruin your page or company reputation, remove them immediately. You'll feel instant gratification with the click of a button.

On our page, we had an outwardly offensive and vulgar fan that we had to remove. We encourage debates on our page, but we have zero tolerance for disrespect of other fans. Plus, I think someone needed to remind this person that this is an Apple vs. Google fan page -- not the streets of New York:

Take your audience's temperature
Once you have grown your "likes," test out how active and involved your audience truly is on the site. An easy way to do this is by rolling out a contest. Hands down, it is the simplest -- and often most inexpensive -- way to interact with your fans, share your comments, and build your audience. Here's the trick: Always tie a question in with the contest. Ask fans for their opinions on a topic or have them vote on a particular issue. The comments you receive will teach you about your audience members, their interests, and how they like to communicate.

On our ApplevsGoogle page, we asked our fans the obvious question: Apple or Google? Our fans not only told us which company they prefer, but more importantly, why they chose one over the other. Sure, some comments were structured in a manner that resembles how Donald Trump might speak about his good friend Rosie O'Donnell, but for the most part, these comments provided insight into what our fans truly value:

Change the pace by diversifying topics
Posting topics according to a calendar is good in theory, but that strategy can work against you. Following a schedule causes you to lose sight of newsworthy topics that people are excited to discuss. In addition to creating conversations, your site should also be part of the conversation. Don't miss out on an opportunity because it wasn't "penciled in."

We know our fans love talking about their phones, so we jumped at the opportunity to discuss the new Window's smartphone. Although it was not directly related to Apple or Google, we felt we could get our fans involved, and we wanted to hear their opinions. This post was successful and received a higher-than-average response:

Don't be afraid to advertise
Don't be afraid to advertise; if done correctly, it can yield positive results. Be sure to tailor your ads to the targeted demographics. We are currently running several ads and have garnered an impressive number of fans as a result. In less than five months, we picked up 9,302 fans directly from these ads. You can't ignore the numbers.

Below are the most effective ads we ran for the ApplevsGoogle campaign:

Speculate and instigate
If your company page is not regulated by an iron-clad legal team, create a conversation through speculation. Sure, speculation is a form of instigation, but what better way to get to know your audience and where it stands on issues? Get people talking and allow them to have the conversation on your page.

The below post turned out to be one our most instigative since it received 2.5 times more comments than average, and nearly twice the "likes." Why? Because we were speculating on the future of Facebook:

Ask a question if you want an answer
The simple fact is that questions encourage interaction. If your site focuses on posting statements all the time, you're missing out on many opportunities for fans to engage with you. And Facebook users want to give their opinions just as much as your mother-in-law does.

Excluding our contests, the three ApplevsGoogle posts that generated the most comments all ask our fans a question about a relevant topic. It's as if they were just waiting to be asked.

From a marketer's point of view, the fewer restrictions placed on social efforts, the more opportunity you have for creativity. And it's amazing what can be accomplished quickly and cost effectively. Our no-holds-barred ApplevsGoogle fan page served as a social experiment for us and proved invaluable for collecting relevant user insights. The lessons learned have been used to support various internal and client initiatives, and in the end, it's been a lot of fun.

Incidentally, although it has no bearing on the lessons described in this article, the agency selected the iPhone 4 for the staff.

David Clarke is co-founder and managing partner of BGT Partners.

On Twitter? Follow iMedia Connection at @iMediaTweet.

If you want to reach Baby Boomers, you also need a robust and defined social media strategy. One of the biggest misconceptions about marketing and advertising to Boomers is that social media and online marketing only appeal to a much younger crowd. Yet, Baby Boomers make up one-third of all online and social media users, and there are more than 8 million that spend more than 20 hours a week online.

In other words, this is not the selling environment of your grandparents' generation. Just as marketers and agencies have always employed specific tactics to engage the younger generations --  Gen X, Y, and Z -- to capture a piece of the youthful in spirit Boomer pie, things now need to be served up a little differently than in the past.

The fact that Baby Boomers are also a wealthy segment controlling nearly 70 percent of the disposable income in the U.S., or $2.3 trillion according to a Nielsen study, cannot be ignored. They represent 44 percent of the population and purchase 49 percent of total consumer-packaged goods (CPG). In fact, Boomers dominate purchases in 119 of 123 CPG categories, and have the money to spend. They also enjoy their work and work past the traditional retirement age -- 63 percent of Boomers still have at least one person in the household working full time. Finally, they're on track to inherit an additional $6 trillion (for a total of $8.4 trillion), according to MetLife.

And when it comes to spending their money, Baby Boomers are known to seek out products across a few key categories. According to U.S. News and World Report's "How to Profit From Aging Baby Boomers," these categories include items that help them age safely (to adapt to changes in vision, strength, hearing, dexterity), cater to their youthful attitudes (travel and recreation), maintain independence (transportation services, in-home care), absorb lifelong learning (online courses), and leverage smart technology (alert systems that notify first-responders of medical emergencies).

So how can brands effectively reach out and market to this very unique demographic? As marketing teams craft their advertising and digital campaigns around the Boomers, it's important to remember that they are what we refer to as a "product consuming" group. Unlike their younger counterparts -- many of whom make their buying choices based on information shared via social networks -- the Boomers actually want to be the recipients of advertisements.

However, to reach them most effectively, advertisers must truly understand just how youthful, vigorous and energetic this group perceives itself to be. It also takes some creative messaging, selection of the most appropriate media outlets, and overall understanding of the things that Boomers enjoy -- like exercise, travel, entertainment, and other inspiring activities.

Naturally, what ultimately works best will vary depending on your product and services, but many experts agree that effective marketing strategies need to get the message right and be authentic. This approach also sometimes includes applying "ageless marketing" techniques, when applicable.

How can this be accomplished? The key is to focus on values and life experiences, rather than a specific age group or demographic. Generally, successful ageless marketing campaigns focus on areas such as health and well being, productive living, the importance of autonomy and empowerment and the value of relationships. The goal is to develop a message that resonates with multiple generations.

How a product is named also can have a dramatic effect on results. A successful ageless marketing campaign should present a positive, mindful image of aging that is consistently applied to all marketing materials. Remember, mature adults feel anywhere from 15-25 years younger than their biological age, and they don't want to be presented with images and phrases that suggest aging is undesirable. Ageless marketing must be careful to avoid stereotypes, buzzwords and negative connotations associated with aging. Specifically, marketers must avoid words like "elderly," "retirement," "senior citizens," or "nursing home." The goal should be to find the right balance between portraying active, yet realistic images.

People are living longer, and turning 65 no longer means you sit in a rocker to read books or knit all day. This market is active and engaged. Forget sending flyers and brochures through snail mail -- Baby Boomers are tech savvy, and require new and innovative marketing strategies.

The bottom line: There are 77 million Baby Boomers in our national market with money to spend and a desire to spend it on products and services that reward them, or make their lives easier or better. Given their sheer size and economic clout, Boomers will remain the most influential and forceful consumer group for years to come.

Smart marketers will embrace this untapped potential by offering innovative product develop-ment, tailored customer services and unique marketing strategies. Successfully targeting Boomers with effective and engaging advertising is like serving any other specific consumer group: you have to get to know the demographic, understand their likes and dislikes and speak to the group in a way they can relate to.

Jessica Hawthorne-Castro is the CEO of Hawthorne Direct.

On Twitter? Follow iMedia at @iMediaTweet.

"Attractive man enjoying his morning coffee on his computer outside his hotel room" via Shuttestock.


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