A new Point of View on outdoor advertising, written by Dede Fitch and titled “Out-of-home, not out of place,” was published last week. Dede’s basic premise is that as out-of-home advertising fragments into new niches – think airplane tray tables – the context in which the ad is seen becomes ever more important. Just three days later, Adweek ran this article: “Out-of-Context Ads Prove Effective.” I was intrigued. Did this mean the new POV was already out-of-date?
The answer was, and is, no. The POV is still relevant. The Adweek article is about online advertising, and reports on a study run by Yahoo! and MediaVest. The lead finding of this study, as reported by Brian Morrissey, was that “Product ads displayed out-of-context had roughly the same impact on brand preference as identical placements shown next to related content.”
In her POV, Dede talks about a different type of context, the context of out-of-home advertising. For out-of-home advertising, there is no “content,” and the ad vehicle itself is the medium. Out-of-home advertisers need to align their ads not with any surrounding content, but with the mindset of consumers encountering the ads. If the ad is not relevant to the time and place in which it is encountered, it may be ignored, or, worse, resented. Click here to read the full POV.
The Adweek article is interesting in its own right because, as it states, the new research “casts doubt on the long-held belief that advertising is most effective when placed near content related to the product.” The results of the AdWeek study are consistent with those of another recent study conducted by JupiterResearch for Revenue Science. That research found that in terms of gaining the notice of category purchase intenders, behavioral targeting surpassed contextual advertising by at least 10 percentage points in each of 14 major product categories. This study also found that the people who are receptive to behavioral targeting have higher incomes and spend more on online purchases.
Members of the search engine marketing industry have reacted to these findings with some disbelief. For instance, referring to the Yahoo!/MediaVest study, Justin Davy says (on his blog), “In all my experiences thus far CTR [click-through rate] as well as the quality of visitors have been higher when matching ads with related content.”
There is a good reason why a behavioral measurement like click-through would be higher in-context than out, but that rationale does not apply to brand-building effects like those reported in Adweek.
If you read the Adweek article carefully, you will note that the people recruited for the research were “passionate about a particular subject area.” Because the respondents cared about the product category, they were likely to find ads related to that subject to be personally relevant. By neatly leveling the playing field and removing the effect of interest in the product category, Yahoo! and MediaVest could see what the real effect of relevant content might be. As Jim Kite, president, connections research and analytics at MediaVest, states in the article, the research suggests “Targeting the right people is more important than the content.”
The achievement of high click-through rates is a numbers game that depends on the penetration of active shoppers. When they are actively researching a purchase, people will seek out content that will help them make a decision. If, on a relevant site, they find an ad they consider relevant, they will probably click on it. Relevant content attracts a higher concentration of people who are in the market. It does not amplify the inherent effect of the ads placed in it. If you can target the same people out of context (as Yahoo! and MediaVest did), you will get a very similar response.
While AdIndex does not control for category interest, Ken Mallon, VP, custom solutions and ad effectiveness consulting at Dynamic Logic, confirms that its results show a similar pattern to the Adweek study when it comes to brand awareness. He concludes “Context has little or no impact when the goal is brand awareness. Ads stand out more out of context but are more relevant in context, thus offsetting performance.” He points to the difference between pharmaceutical ads and entertainment ads. Pharmaceutical ads generate a stronger purchase-intent response when placed in context. But this difference is far less apparent for entertainment ads, such as those for TV shows and movies, which tend to appeal to a wide audience.
All of which might be summed up as, personal relevance trumps context relevance. Reach people with an ad which is relevant to their circumstances and they will respond positively, whatever the context. So what is your opinion? Is context targeting losing its relevance?
(14 votes, average: 2.71 out of 5)
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October 3rd, 2007 at 5:39 am
This makes sense. Consider that the process of media planning has always been to get closer to the people most likely to be interested in your advertising. To this end,
context had merely been a “stepping stone” to reaching them. Like so many other aspects of the marketing discipline context serves as a substitute for certainty. Consider the way media plans are built – all the metrics are based on the likelihood of reaching an audience that is relevant. Context just took away some of the guesswork. And now that advertisers have demonstrated that by reaching people who care about the category (an assumption underlying context), you can do better than just relying on context alone.
OK so far: now how do we ensure that our advertising reaches only those who really are interested in your product. Not sure I have the answer to that. But I sure know how to design an experiment to do it.
Back to the drawing board.
October 3rd, 2007 at 5:44 am
Thanks for the comment Philip, I like the analogy of the stepping stone.
I am sure studies like this are being conducted in anticipation of better behavioral targeting - targeting people on the basis of interests and attitudes inferred from their own online content and sites/content visited on a regular basis.
May 19th, 2008 at 10:37 pm
Behavioral targeting works pretty much the way you describe. Historical search and browsing behavior are used to create inferred interest vectors. These are then used either directly (show an auto ad to someone who has recently browsed or searched for auto content) or indirectly (building models using the entire vector to predict future behavior such as clicking, downloading a brochure, watching a movie trailer, etc.).
Better get used to it. Behavioral targeting will eventually be part of all media. TV Next.