Not a day goes by when we're not faced with the gloom of the economy in general, and online business is no different. While advertising is here to stay as a revenue model for many publishers, they face shrinking CPMs and an ever-growing need for advertisers to show robust ROI for their advertising campaigns.
But, targeting techniques have not improved much since the last recession. The industry has failed to update the technology to a level worthy of the massive, growing, internet advertising market. Publishers are feeling the need to get very creative in deriving as much revenue as possible from their inventory, and need an edge in order to thrive in the new economic reality.
It's going to be an uphill battle because every publisher faces certain limitations. No matter how big a player they are, publishers have a defined set of URLs that are categorized according to content and advertising. The publisher decides what ads fit on which page categories, and loads various articles of similar topic onto that page.
But content is a complex, shifting thing.
No two web pages are the same in meaning. Despite this, however, they are often posted to the same URL category, because a more granular level of inventory is too complicated to manage. That's why a URL categorized for technology articles will have a story about software but ads for cellular phones. Most likely, that means advertising funds were spent ineffectively, and a publisher is showing a poor click-through rate.
The next problem is related to the frequently confusing nature of keywords. Contextual advertising systems, which are an industry mainstay, use keywords contained in content to trigger the placement of certain ads on a page. But when one keyword means two different things, or occurs in an unintended context, advertising money goes down the drain. That's why the Hilton Hotel in Paris would hypothetically pay for ads sent to pages about Paris Hilton. Examples abound -- just do a keyword search (there's irony for you) for "contextual advertising mistakes" or a variant thereof. Again, such advertising is unlikely to result in a click-through.
Semantics: the future of web monetization
There is a new level of utility and interactivity coming to the net, largely based on semantics, machine learning, and natural language processing. The business engine behind these developments is semantic advertising technology. Its purpose is to understand web page content so that ads can be attached to the most relevant articles. Using developments in natural language processing and machine learning, semantic advertising algorithms go beyond the simple use of keywords by analyzing various words on a page to establish meaning. The upshot here is that publishers now have a much more effective way to target their advertising, enhance ROI advertisers, and make more money. Semantic advertising enables three important abilities that can potentially save a lot of online publishers from gloom and doom:
- Optimize your URL inventory: Semantic advertising technology can reorganize and classify a URL inventory into several different and/or new categories and sub-categories. The process is done automatically and on-the-fly. This effectively allows publishers to get more classifications per page and make the utmost of their limited number of URLs. The technology also performs in a way that non-intuitive areas are sometimes found, such as putting URLs in a category that a publisher never considered before. More categories mean more exposure, which means more impressions and click-throughs. Publishers also get new opportunities to cross-sell, attract more advertisers, and increase the number of products sold per client. And less ad space gets sold as remnant traffic. All this comes without increasing the administrative burden on the sales force -- except for dealing with more business.
- Improve your targeting: Semantic advertising technology connects the true meaning and sentiment of a web page with the most relevant advertising. Put simply, semantics makes sure that the ads and the web page content are pretty much about the same thing, maximizing the chance that the reader will have an interest in the advertised product or service.
- Improve the advertiser experience: Overall, semantic advertising technology ensures that both the publisher and the advertiser client get to win. By improving the possibility of sales conversion, a publisher's website can achieve the results that advertisers demand. It lets publishers reverse the current downward trend of profit by ensuring that clients continue or even improve advertising contracts and contract terms.
Semantic advertising technology is real and exists today. Real world results with top-tier online publishers have racked up impressive increases of various metrics such as click-through rates, target category impression delivery, category lift, and growth in sellable advertising channels. It also enables savvy publishers and advertisers to prosper even during challenging times, and is poised to become the new standard in online content monetization and advertising.
Amiad Solomon is the founder and CEO of Peer39.