Contextual marketing has shaken many a marketing department to its foundations: “We have to do something with it!” (It’s a statement we also hear frequently about Big Data.) Applied correctly, contextual marketing can boost sales enormously. But what is it actually, and what do you as a marketer do with it?
Contextual marketing is marketing in which both the content and the timing of the message are matched as closely as possible to the context. This can include anything: the preferences of a person, previous purchases, latent need, as well as environmental factors or location. In brief, contextual marketing involves signals and data that help highlight the content and timing of the message.
Contextual marketing is actually a strange concept because in principle, every marketing form is more or less contextual, even something such as an old-fashioned TV commercial. Spots often target the same group as the TV program they are programmed around. A travel show, for example, often has travel-related spots before, during, and after the program. The context is in that sense the latent interest: travel.
Yet such “old-fashioned” marketing is shooting at random, depending on mass. There is a reason that ratings determine the price of a TV advertisement. In real contextual marketing, the context can be determined much more accurately, preferably even in real time. For example, is a woman from Amsterdam looking for respectable shoes? Then you want to spotlight black pumps in the Amsterdam store, not black football shoes in the Maastricht store. If your marketing message meets the context, then the message is much more effective.
There is no place you can determine the context as clearly as on the web. Previous purchases and searches, social media profiles, web searches: these factors all indicate information on a consumer’s preferences and interests. And on the web, that information can be determined and recorded easily in a profile or a cookie. Using that information, it is possible to target appropriate marketing messages at the right people, at the right time, the right place and with the right intentions.
A simple example of contextual marketing on the web is Google AdWords, in which the desired search results come up based on relevant searches. The message then goes to the person who is looking for information about the products or services you offer. Along with generating relevant visits, AdWords also determines the actual size of the search volume surrounding certain search queries. Google AdSense works in a similar way but instead of showing websites in its search results, it displays banners that are relevant to the visitor.
Another effective contextual marketing method is retargeting, in which visitors to your website or online shop see banner adverts on sites that are designed to show them. Only those who have already visited your website will see these banners. The content of the banners is also based on the product group they visited on your website, so the context here is the previous interest shown in that product group. The power of repetition is also present: You are again showing people your products or brand name.
Mobile contextual marketing
Mobile technology, especially smartphones, enables entirely new platforms of contextual marketing, as the mobile device reveals the location of the user via GPS. Digital beacons, such as Apple’s iBeacon, also expand the possibilities and are the subject of much research and experimentation. For example, a project known as Amsterdam BeaconMile was recently launched in Amsterdam, offering tourists information on their smartphones about nearby attractions and stores.
Digital beacon technology offers a plethora of possibilities for contextual marketing. Think of a coffee shop that sends vouchers to entice customers passing by, or a fashion store that shows new jeans to nearby denim fans. The context in such situations involves the current location of the client and possible previous purchases.
In the future, systems will be much better at anticipating contextual factors. Think, for example, of the current weather situation, or how someone’s favorite sports team performed, or status updates on social media. But also consider how a particular individual may be feeling at that moment. The consumer will decide more and more who he or she shares information with because privacy will also remain an important issue in the future.
At any rate, consumers will become increasingly connected and will leave countless relevant data tracks behind. This will make the marketer’s work easier because it offers an enormously rich packet of information. Contextual marketing platforms will become indispensable and will prevent information from being fragmented and spread out in dozens of different silos within the organization.
It will become an ever-greater challenge to offer the right message based on all those information streams without giving customers and potential customers the feeling that they are being watched. Along with the potential business gains of contextual marketing are enormous challenges and risks as well.
It will be interesting times, and not just for marketers.
Want more insight on how tech is changing the customer experience? See Embrace Big Data In A Big Way.