By Rob Blake UK Country Manager, Channel Factory

Advertising has faced many changes over the years. The demise of third party cookies and a patchwork of new policies and regulations, combined with hyper-aware consumers on data privacy rights, makes for a tough time for marketers. Advertising across video content compounds this, where the complexities of ad placement to protect brand reputation in an inclusive way brings a new level of targeting challenges for brands and businesses.

Dating back to as early as the 1930s, ad executives increased ad revenue by courting businesses that sold household products targeting homemakers. Procter & Gamble became the first major advertiser to sponsor one of these daytime dramas using their Oxydol soap powder, a laundry detergent. Thus, the soap opera was born, and the idea of connecting your audience to the content they are watching.

Fast forward to 1994, the first banner ad was created, launching a slew of online advertising hype. A year later, advertisers wanted to target their customers, and used websites as a proxy for where their audience would be – this was the first form of online contextual targeting. This developed in line with digital advancements until 2006 when Google acquired YouTube to become the world’s advertising platform. Google and Facebook were uniquely positioned to gather customer preferences and  started targeting ads directly to the customer via audience targeting. Some call this the ‘golden age’ of advertising.

It is in the last 5 years that laws around data privacy have forced advertisers to rethink their strategies. From 2017, brand safety and suitability issues became mainstream focus, with several big name brands having safety scandals that lead them to pause advertising until their strategies were redefined. In 2018/2019 Governments start to create laws in Europe (GDPR) that limit the use of data sharing of individuals and browsers start limiting cookie-based targeting.

Then, in the last two years with the COVID-19 pandemic, protests for racial justice, and hugely influential political elections globally, there has been a social shift in the world that has made brands start to re-evaluate their decisions on brand safety and content monetisation. Channel Factory’s own research found that 69% of consumers would prefer to buy from brands committed to socially conscious causes.

Businesses looking for new methods of targeting their audiences need look no further than the 1930s when specific content was chosen to advertise against based on generic audience profiling as opposed to using personal data to target specific individuals – this is contextual advertising.

Contextual is one strategy that has remained steady and in many cases, has been the bedrock of some of the most successful campaigns – our research found that 73% of consumers would be likely to buy from brands whose ads are relevant to the content they’re consuming on YouTube. Reaching the right audience around the right context has always been a key factor in any advertising strategy, dating back to the dawn of the industry.

It still works. ChannelFactory conducted a recent survey with GroupM on the value of context and the impact contextual alignment has on different verticals. The results were staggering, across all verticals, there was a 17% lift in ROI (sales) recognised by the agency for their clients that used contextual targeting on YouTube.

Obviously the digital landscape has changed. Industry standard advertising practices can unfairly penalise content creators within various groups, including the LGBTQ+, BIPOC and AAPI communities, as well as content relating to important aspects of the human experience, including social issues, mental health and wellness and identity. Similarly, language is used as a proxy for premium content, with a brand restricting language to just English or local language + English. But most countries have residents that speak a multitude of languages, and in a recent study we ran in the UK, 81% of respondents stated they live in a bilingual home, with 18% saying English is not their first language.

Therein, the future of video advertising, lies not in over cautious block lists but in inclusive lists that match brand suitability. Understanding that people are diverse and that quality content does not always mean suitable content means that advertising can be a force for good in this increasingly digital world. Contextual targeting has not only withstood the test of time but will continue to be the natural and safe way to target consumers in the future.