Everything you need to know about Contextual Targeting on CTV in 2024

In the dynamic world of digital advertising, contextual targeting on Connected TV (CTV) represents a significant evolution from traditional audience-based targeting models, blending the precision of digital technology with the broad reach and high quality programming of television. This guide delves into the mechanisms and benefits of contextual targeting in the CTV landscape, highlighting its effectiveness at creating meaningful connections with target audiences through aligning ads with relevant content.

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What is Contextual Targeting?

Contextual targeting involves placing ads in a content environment that is directly relevant to the ad itself. Unlike behavioral targeting, which relies on user data and past behaviors, contextual targeting focuses on the content being consumed at the moment.

Why does Contextual Targeting matter on CTV?

To date, CTV has traditionally relied on traditional audience-based targeting models. However, the unique dynamics of the CTV ecosystem, characterized by its walled gardens and fragmented landscape, have restricted the use of contextual targeting, limiting advertisers to basic data and targeting options. Recent advancements in CTV targeting capabilities are beginning to bridge these gaps, enabling advertisers to implement more sophisticated contextual strategies that scale. Contextual targeting advances will now let advertisers take an approach more similar to how they target ads in linear TV — with media buyers able to buy context in specific shows, as well as audiences.

What are the benefits of Contextual Targeting on CTV?

Enhanced viewer engagement with contextual targeting

Contextually relevant ads tend to resonate more with viewers, maintaining engagement and enhancing the overall ad experience. Studies suggest that ads relevant to the content being watched can significantly increase viewer attention and interaction. This phenomenon has been covered by AdAge’s dive into how contextual is driving effectiveness.

As per a recent study conducted by the AVCA (Alliance for Video-Level Contextual Advertising) when ads are contextually misaligned with content:

• More than half (54%), of respondents were less interested in the brand and products found in contextually misaligned ads.
• More than one-third of viewers liked the brand less and paid less attention when an ad was placed in unsuitable environments.

Brand safety benefits of Contextual Targeting

By aligning ads with content that reflects the brand’s values and message, advertisers can avoid the pitfalls of inappropriate or harmful content associations, thereby safeguarding the brand’s image.

Strategically aligning ads with content that mirrors a brand’s values and messaging builds brand equity, plus it allows advertisers to effectively sidestep the risks associated with unsuitable or contentious content. For example, a brand can advertise on news platforms while avoiding placement next to war coverage or politically divisive content, thereby preserving the integrity and perception of the brand among its audience.

Improved ad effectiveness using Contextual Targeting

Contextual targeting allows advertisers to deliver messages at moments when viewers are most receptive, thus improving the chances of ad recall and positive brand interaction.

A study by the AVCA found that when ads are placed next to relevant content:

• 42% of viewers said they were more interested in the brand and products.
• 38% learned more about a product shown in AI-enabled contextually targeted ads.

How can you implement Contextual Targeting on CTV

It can be difficult to implement true contextual targeting on CTV. Many different supply sources use different metadata, and metadata can be inconsistent between shows or channels. In addition, getting real-time scene level data has been near impossible for advertisers. This has made scaling advertising campaigns difficult across platforms and content types.

Using a tool like BrandDiscovery can help you implement contextual targeting on CTV by:

• Improving and expanding on metadata: BrandDiscovery can understand and normalize detailed metadata from programs to help align ads with specific genres, themes, or even moods of shows.
• Using real-time data: Incorporating real-time data allows for dynamic ad placements, targeting placements based on what is actually happening on screen just before the break – instead of the genre of the show, channel, or app are characterized overall.
• Focusing on brand suitability: Ensure that the context of the ad placements aligns with the brand’s values and campaign goals for maximum impact.

What is the future of Contextual Targeting on CTV?

Emerging technologies like AI and machine learning are set to refine contextual targeting practices on CTV. These technologies can analyze video content at scale to identify and categorize context more accurately, enabling advertisers to target ads with unprecedented precision.

How can advanced GenAI power Contextual Targeting for CTV?

Wurl’s BrandDiscovery enhances CTV advertising by employing GenAI for contextual targeting — aligning ads with streaming content based on dialogue, sounds, and visuals. Contextual ads are placed in real-time based on content analysis, emotional alignment, and brand safety, increasing viewer engagement and ad effectiveness. Additionally, Wurl offers tools to facilitate ad placement almost anywhere on FAST, ensuring ads are seen in the most relevant contexts. Wurl is also an SSP in our own right — meaning you get access to unique supply on some of the most viewed CTV channels.

Privacy regulations and contextual targeting

Contextual targeting focuses on finding the correct moments in content to show ads. Unlike behavioral targeting, this method does not track individual user behavior or require cookies/identifiers, ensuring it does not suffer from the impacts of current privacy rules and regulations. In this way, it is a smart choice for marketers looking to build a robust, resilient, and long-term marketing strategy.

How is Contextual Targeting a new era in CTV?

CTV is evolving with the proliferation of ad-supported streaming, giving rise to an era of contextual targeting that enhances ad resonance and effectiveness. This approach allows advertisers to synchronize ads with viewer environments, such as aligning fast-food commercials with content that induces hunger, thus making advertising more effective and contextually relevant.

The CTV landscape has matured through several phases, beginning with a rapid expansion in channel variety and viewer choice, to facing challenges like platform fragmentation and difficulty in precise ad targeting.

Today’s advanced strategies use generative AI (GenAI) to enable fine-grained, emotion-sensitive ad placements, offering real-time, scene-specific targeting that aligns ads with the emotional tone of content, drastically improving viewer engagement and ad performance.

As CTV advertising continues to grow, strategies like Wurl’s BrandDiscovery are at the forefront, leveraging GenAI to unlock new levels of advertising precision and effectiveness. This technology enables marketers to connect more deeply with audiences, ensuring ads are not only seen but are contextually integrated into the viewing experience, enhancing both impact and viewer satisfaction.

What is the impact of GenAI-driven Contextual Targeting on CTV?

Wurl’s new product BrandDiscovery utilizes GenAI to transform CTV advertising by enabling precise contextual targeting based on real-time analysis of imagery, sounds, and dialogue. This technology aligns ads with viewers’ emotional states and content scenes, enhancing ad relevance and effectiveness. BrandDiscovery not only targets ads more accurately but also respects viewer emotions, potentially tripling engagement. The platform offers scene-level targeting for genres and brand safety, further refining ad placements beyond traditional program-level metadata. This approach marks a significant advancement in maximizing the impact and efficiency of CTV ad campaigns.

Advanced Contextual Targeting technologies showcased by VideoWeek

Wurl contributed to VideoWeek’s 2024 CTV Advertising Guide, reflecting on post-pandemic market stabilization and the significant role of streaming in U.S. TV viewership. The guide discusses both buy-side and sell-side strategies, emphasizing the benefits of contextual advertising. Ria Madrid of Wurl underscores the transformative impact of contextual targeting, like Wurl’s BrandDiscovery, which allows for precise ad placement based on emotional content alignment, potentially tripling ad performance.

How can fintech companies benefit from Contextual Targeting?

Leading agency Monks, leveraging Wurl’s BrandDiscovery for emotion-based contextual targeting in CTV ads, achieved significant campaign improvements for a fintech client, enhancing brand awareness, favorability, and purchase intent.

By aligning ad emotions with the content’s emotional context, Monks not only doubled the effectiveness of the ads in driving viewer actions but also reduced the cost per engagement by 50%.

This strategy capitalized on the emotional congruence between the ads and content, resulting in heightened viewer engagement and substantial performance gains over traditional targeting methods

How does Contextual Targeting fit into a Full-Funnel CTV marketing approach?

Wurl’s comprehensive guide for 2024 details a full-funnel approach to CTV marketing, emphasizing the unique capabilities of CTV to build brand equity and drive conversions through precise targeting and contextual advertising.

With a sharp increase in CTV adoption, particularly among younger demographics, the guide highlights key strategies to harness CTV’s potential across the awareness, consideration, and decision stages.

It discusses leveraging emotional resonance and advanced analytics to enhance viewer engagement and ad effectiveness, ultimately guiding brands on optimizing advertising efforts from top to bottom of the funnel.

How is Contextual Targeting driving a revolution in CTV advertising?

In advertising, we’ve always aimed to show the right ad to the right person at the right time. But this prompts the question: how can we really be sure what “right” means?

This isn’t just a throwaway thought; it has the potential to remake how we think about advertising.

GenAI is reshaping CTV advertising by ensuring ads are contextually aligned with viewers’ emotions, enhancing both viewer experience and advertising effectiveness. BrandDiscovery, Wurl’s pioneering platform, enables precise, scene-level targeting without additional costs, focusing on emotional, genre, and brand safety categories.

This innovation not only improves ad receptivity but also addresses the industry’s transparency and targeting challenges, marking a significant shift towards more personalized and effective advertising strategies.

How does Contextual Targeting build brand loyalty across the entire funnel?

In response to questions from the market, Wurl developed the Brand Awareness Flywheel as an explanatory aid of the benefits of this dynamic new approach to capturing and amplifying viewer engagement on CTV.

This flywheel integrates Wurl’s extensive insights on emotional targeting to boost brand affinity and loyalty through five interconnected stages: Brand Perception, Priming, Emotional Resonance, Positive Attention, and Halo Effect.

By aligning ad content with viewer emotions and preferences, the flywheel ensures that each advertising interaction enhances viewer receptivity and deepens brand impact, leading to increased brand loyalty and measurable growth in viewer engagement metrics.

How can Contextual Advertising help publishers by boosting session lengths and enhancing viewer engagement?

Maintaining viewer engagement is essential for content publishers to maximize advertising revenue and enhance viewer satisfaction. Wurl insights reveal a post-pandemic shift in viewing habits, with audiences preferring to stick longer with their initial content choices.

To help publishers capitalize on this trend, Wurl has outlined eight strategic tips to enhance session lengths and improve engagement. These include improving content quality, focused content streams, innovative scheduling, and leveraging data insights to optimize viewer experience.

Contextual targeting is extremely important for publishers: showing that ads matching the emotional tone of TV scenes can reduce viewer drop-off by up to 60%. By implementing these strategies, publishers can not only attract viewers with high-quality content but also retain them with seamless scheduling and relevant, engaging ads, ultimately boosting advertising opportunities.

What are the Contextual Targeting challenges facing advertisers with the rise of ad-supported streaming?

Industry fragmentation, performance tracking, crowded advertising markets, and viewer tolerance of ad load are major hurdles in the era of FAST and AVOD services. Despite these challenges, opportunities abound for marketers to leverage emerging technologies such as GenAI for improved ad delivery and contextual targeting. Wurl helps advertisers to navigate these complexities efficiently, maximizing ad performance and viewer engagement in the competitive streaming space.

Does GenAI outperform humans when classifying content for Contextual Targeting on CTV?

Ron Gutman, CEO of Wurl, argues that GenAI displays a better understanding of human emotions than humans in the context of contextual targeting on CTV. With ad spending in connected TV expected to hit over $30 billion, leveraging emotions in advertising has become critical.

GenAI technologies, now capable of interpreting human emotions and supporting scalable solutions, are setting the stage for advertisers to create more resonant and effective campaigns. Gutman explains how emotions, deeply rooted in human biology and psychology, play a pivotal role in decision-making and brand recall, making them a prime target for advanced CTV advertising strategies.

By aligning ads with viewers’ emotional states through precise GenAI analysis, marketers can significantly enhance ad impact and viewer engagement, leading to more successful advertising outcomes in the dynamic world of CTV.

How did PMG boost QSR sales with contextual targeting on CTV?

PMG successfully harnessed Wurl’s BrandDiscovery and Innovid’s dynamic ad insertion technology to drive significant increases in restaurant visits and sales for their Quick Service Restaurant (QSR) client.

By strategically aligning ad content with viewer emotions related to hunger and cravings, PMG optimized ad placements during CTV programming that resonated with these feelings.

This targeted approach led to a 40% lift in incremental restaurant visits and a 48% increase in sales, showcasing the power of emotion-based targeting in enhancing the effectiveness of CTV advertising campaigns. This innovative strategy not only met the client’s goals but also set a new standard for engaging potential customers through emotionally resonant advertising.

How is contextual targeting transforming CTV?

Contextual targeting on CTV is transforming TV advertising by making it more relevant, effective, and safe. As technology advances and more data becomes available, the precision and effectiveness of contextual advertising are offering exciting opportunities for brands to connect with their audiences in meaningful ways.

For more information on how contextual targeting on CTV can work for your brand, talk to one of our experts.