2015 Contextual Advertising Results and 2016 Forecasts
The year 2015 witnessed significant events in contextual advertising. “Yandex.Direct” modified its auction scheme by discontinuing discounts for advertisers, while Google ceased supporting Flash banners and fully transitioned to HTML5. How did these changes impact content development? What does the future hold? Find out in the Quarter Billion Agency Group blog.
Yandex
Direct emerged as the key reformer of contextual advertising in 2015, implementing changes to its auction system and eliminating discounts for advertisers.
Prior to September 1st, ads were allocated in the primary blocks based on the CTR-to-bid ratio and positioned in descending order. Following a successful two-month trial of the updated Yandex.Direct, advertisers expressed satisfaction as the cost of clicks returned to average levels, and the number of clicks in a special placement increased.
However, experts suggest that in reality, the cost per click has increased by approximately 10%. Additionally, only a small number of customers, particularly in the telecom/home internet segment, experienced a significant decrease in CTR ranging from 70% to 100% for the same amount of traffic.
Equally anticipated were the innovations introduced by Yandex, including the ability to adjust bids specifically for smartphones, create mobile ads, and track search queries from mobile devices. Now, bid adjustments for displaying ads on mobile phones can enhance efficiency by 20-30%. For instance, this could result in an increase in phone calls from smartphones or a reduction in mobile traffic due to lower conversion rates.
“Yandex” has introduced bid adjustment features that allow targeting specific audience segments based on socio-demographic status and remarketing script configurations within “Yandex.Metrika 2.0.” These functions enable more active engagement with each distinct segment. For instance, if statistics reveal that female visitors aged 25-34 have a 20% higher conversion rate compared to other users, it becomes possible to increase ad visibility specifically for this group, thereby enhancing the overall advertising effectiveness.
Introducing a new breakthrough: dynamic ads for e-commerce. This cutting-edge feature not only enhances ad quality but also significantly reduces the labor involved in creating ad campaigns. Advertisers are currently putting this option to the test, and its popularity is on the rise.
The inclusion of quick links in ad descriptions for navigational queries ensures that the ad unit closely resembles organic search results. This seamless integration boosts the click-through rate and enhances the contextual experience. With each update from Yandex, the significance of ad quality, including the descriptions for quick links, continues to grow.
Google’s innovations were not as ambitious when compared to “Yandex.” While “Yandex” projected traffic growth with consistent click prices, Google released data indicating an annual increase in the average cost per click for contextual advertising across various sectors.
Unlike “Yandex,” Google has long provided the ability to adjust bidding for mobile device display. Interestingly, Google recently conducted an extensive study on device usage in different regions of Russia. The statistics revealed that, for instance, in the Primorsky region, smartphone usage has surpassed 60% since the beginning of 2015. However, in the Tomsk region, this figure has been declining due to unstable mobile internet and users’ impatience with slow SERP loading.
Google remains vigilant in monitoring global trends. For instance, in response to the widespread rejection of Flash technologies, Google made significant changes. Starting in January 2015, they ceased support for video playback in the Flash format on YouTube, followed by the discontinuation of banners in August 2015. Instead, Google announced a shift towards HTML5, enabling internet users to open multiple tabs simultaneously without waiting for banners to load, especially on slower connections.
Contextual advertising has consistently proven to be one of the most effective internet marketing tools and this trend is expected to continue into the following year. According to the Russian Association of Communication Agencies (RACA), contextual advertising witnessed a 17% increase in the first nine months of 2015, even amid an overall reduction in the advertising market. Experts from GroupM project a 6% growth rate for contextual advertising in 2016, indicating its sustained momentum. Presently, contextual advertising accounts for 80% of advertisers’ overall internet advertising expenditures.
Google consistently focuses on enhancing work efficiency and result evaluation. A notable improvement is the integration of TrueView video advertising into AdWords, allowing campaign management and statistical analysis within a single interface.
Moreover, Google continuously expands opportunities for advertisers. For instance, in September, Native Gmail Ads, known as Gmail Sponsored Promotions, became available to all users. This advertising format enables the display of ads within personal email accounts, presenting a promising avenue for conveying marketing messages. Additionally, Gmail now offers the capability to employ remarketing based on email addresses and search for audiences with similar interests to existing customers. It’s important to note that this feature is exclusive to Gmail users, which may limit its reach in Russia where Gmail is not widely utilized.
Future Outlook for 2016
All the groundbreaking innovations from 2015 will not fade away in 2016; instead, they will evolve further. However, there are noteworthy changes anticipated in the upcoming year.
Google has already made an exciting announcement for 2016: the introduction of Place Actions. When users make relevant queries, a “Knowledge Panel” card will appear in local search results. This card enables users to perform actions such as hotel bookings, mortgage comparisons, or exploring different car models, all without navigating to external websites. Advertisers stand to benefit greatly from this feature, as the visually appealing micro media view captures user attention and encourages high click-through rates, diverting them from regular search results.
Another notable development is Google’s shift towards considering only CPM (visible ad impressions) in their auction process. Currently, assessing the effectiveness of advertising is challenging, especially when ads are typically placed at the bottom of the page, where user visibility is limited. While this advertising may be deemed as a show, in reality, only a few individuals actually see it. With upcoming updates, the number of actual views will be tracked, enabling a more accurate evaluation of ad appeal.
In July 2015, Yandex implemented changes to track the visibility of ads in the “South” block. Now, only instances where users scroll down the page are considered as views. Furthermore, there are plans for Yandex to focus on optimizing mobile advertising. In the previous year, adjustments to rates for smartphones and tablets were possible, and it is likely that next year they will further streamline their management.
The development of call tracking is worth mentioning, as it directly relates to contextual advertising and enhances its effectiveness. Throughout the year, call tracking tools have significantly advanced in terms of intelligence. This aligns with the broader market trend of technological analysis and management in marketing. As figures and data form the foundation of marketing and its outcomes, services and agencies will continue to strive for improvement in the upcoming year.
Source: sostav.ru