Contextual Advertising

The trouble with cost-per-click internet advertising

2006-08-06T16:56:00.000+01:00

http://archive.gulfnews.com/articles/06/08/02/10056938.html

08/03/2006 07:59 PM | Financial Times

Is the type of advertising that turned Google from just one more cool internet start-up without a business model into a corporate superstar too good to be true?

'Cost-per-click' advertising is one of those alluring ideas that make the internet so disruptive. By letting advertisers pay only when someone clicks on their message, and by targeting advertisements - either by linking them to the results of internet searches, or by fitting them to the subject of whatever someone happens to be reading online it represents a huge leap forward in efficiency.

Click-based advertising is founded on one of the favourite myths of the first decade of online activity: that the click is the purest declaration of intent in the online age.

As the basic action that drives internet activity, clicking on a mouse has come to be seen as the fundamental unit of measurement for online behaviour. To click is to cast your vote amid the tide of virtual endeavour. It is a statement of preference, an expression of desire, a prelude to action.

This overly simplistic formulation is inherently flawed. Not all clicks were created equal. This is not just because of outright fraud, though that is certainly a sore point for advertisers.

So-called 'click fraud' is one of those problems where the perception may end up being worse than the practice.

In a court-ordered report, Alexander Tuzhilin, a professor of information systems at New York University, has just pronounced Google's effort to stop fraud to be 'reasonable'. Google seeks out those clicks that have been made for no other reason than to generate a payment from an advertiser.

Yet, however good Google's detection methods, it may never escape the perception that fraud is rife. By definition, it cannot explain to advertisers why it has decided that some clicks were fraudulent but charged them for others.

Let fraud happen?

This is not to say that the booming click-based advertising business is out of control. Google and other search engines have a clear interest in both preventing fraud and helping advertisers to analyse and understand the clicks they receive.

Eric Schmidt, Google's chief executive officer, has recently been lambasted by bloggers for pointing this out. His choice of words was certainly unfortunate: 'There is a perfect economic solution [to click fraud], which is to let it happen.' But he has a point. Yet Google's mission is to bring greater efficiency to the advertising world. It hardly helps to have your CEO explain that a level of inefficiency is baked into the system.

That should be a warning to advertisers who are only now trying out cost-per-click advertising for the first time. It should also serve as a reminder that, like many other things on the internet, advertising is still in its experimental stage.

But as online advertisers look beyond the click, there should be plenty of scope for new rivals to emerge.

Example: Contextual Advertising Snafu 2

2006-02-28T22:43:00.000Z

We are sorry to inform you that due to a violation of our Terms of Service, we have terminated your account. Reason for termination: Invalid clicks generated by any of the following actions:
1. Clicks generated by the website owner.
Clicking on the BidVertiser ads on your own site, for any reason, is strictly prohibited.

2. Asking or encouraging others to click on the BidVertiser ads.
Asking or encouraging others to click on the ads for any reason, either directly or indirectly, is strictly prohibited. Using sentences such as "click the ads to support us", "visit our sponsors" or "please click the ads" will lead to account termination.

3. Displaying the BidVertiser ads in an unrequested pop-up, pop-under or third-party's frame.
Pages showing the BidVertiser ads may never be loaded in an unrequested pop-up, pop-under, floating HTML item or as an inner frame of a third party. Promoting your website or purchasing traffic from clicks-exchange networks is strictly prohibited.

4. Displaying the BidVertiser ads on sites that contain prohibited content.
The BidVertiser ads may not be displayed alongside any type of content prohibited by our program policies, such as adult or mature content, or illegal drugs content.

5. Generating automated scripts or any other method solely meant to generate clicks on the BidVertiser ads.

We would kindly ask you to remove any BidVertiser HTML code from your website ASAP.

Please note that we strive to provide our publishers with the most effective revenue program, while delivering the most targeted and qualified traffic to our advertisers. Unfortunately, the clicks generated by your ad fail to follow these standards.

Example: Contextual Advertising Snafu

2006-02-28T17:19:00.000Z

Account terminated

Dear xxx,

We are sorry to inform you that due to a violation of our Terms of Service, we have terminated your account. Reason for termination: Ineligible clicks generated by any of the following actions:
1. Clicks generated by the website owner.
2. Asking or encouraging users to click on the ads.
3. Creating automated scripts that generate clicks.
4. Any other method solely meant to generate clicks.

We would kindly ask you to remove any BidVertiser HTML code from your website ASAP.

Please note that we understand that as a website owner, you have little to no control over your website visitors and their behavior. Nonetheless, we are obligated for a certain level of quality in order to provide the most qualified and targeted traffic to our advertisers. Unfortunately, the clicks generated by your ad fail to follow these standards.

Best Regards,
BidVertiser Support Team

What is Contextual Advertising?

2006-02-17T18:09:00.000Z

contextual advertising

(n.) Advertising on a Web site that is targeted to the specific individual who is visiting the Web site. A contextual ad system scans the text of a Web site for keywords and returns ads to the Web page based on what the user is viewing, either through ads placed on the page or pop-up ads. For example, if the user is viewing a site about sports, and the site uses contextual advertising, the user might see ads for sports-related companies, such as memorabilia dealers or ticket sellers. Contextual advertising also is used by search engines to display ads on their search results pages based on what word(s) the users has searched for.

Contextual advertising has attracted some controversy through the use of techniques such as third-party hyperlinking, where a third-party installs software onto a user’s computer that interacts with the browser by turning keywords on a Web page into links that lead to advertisers that are not paying the Web site to advertise on its pages.

A contextual ad is the advertisement that dynamically appears on a Web site.

Source: Webopedia

The early years of contextual advertising were marred by companies (like Gator) that installed adware and spyware with their free software, in order to gather information on internet users' surfing habits. The more respectable companies have since learnt to avoid these invasive methods. In fact, contextual advertising has had to evolve as more and more people installed popup and banner ad blockers. Sometimes, the less invasive the approach, the better.

Related links:
http://en.wikipedia.org/wiki/Contextual_advertising