The Case for Overture to Enter the Mass Contextual Advertising Market
Contextual advertising has become an increasingly popular form of marketing in today's digital era. It is the process of showing ads to a user based on their current search query or the content they are reading online. With the rise of internet usage and the popularity of search engines and social media platforms, contextual advertising has become an effective way for businesses to reach their target audience.
Overture was one of the early pioneers of contextual advertising, launching their Pay-Per-Click (PPC) program in 1998. The program gave businesses the ability to bid on keywords to display their ads in search engine results pages, based on the relevancy of the keywords to their business.
Although relatively new to the market, Overture quickly gained popularity among advertisers as they were able to reach their target audience in a more targeted manner. Overture was eventually acquired by Yahoo in 2003 for $1.63 billion, which helped the company to expand its advertising business.
Today, contextual advertising has become a billion-dollar industry, with various players competing in the market, including Google, Facebook, and Amazon. Although Yahoo's advertising business struggled after being purchased by Verizon in 2017, there is a case for Overture to enter the mass contextual advertising market once again.
Here are three reasons why:
1) The rise of e-commerce
The growth of e-commerce has been tremendous over the past few years, accelerated by the COVID-19 pandemic. Consumers are increasingly shopping online, which has led to a huge opportunity for businesses to advertise their products and services.
Contextual advertising can play a huge role in reaching potential customers and driving sales. With Overture's experience in the PPC program, they could leverage their expertise to create an e-commerce advertising program that targets consumers based on their search queries and browsing patterns.
This would give Overture a unique advantage in the market as they could target the vast e-commerce industry, which is rapidly growing. As per eMarketer's report, e-commerce sales are expected to reach $4.9 trillion by 2025, up from $2.3 trillion in 2017. This offers a huge opportunity for Overture to re-enter the market and become a leading player in contextual advertising for e-commerce.
2) Lesser competition
Although the contextual advertising market is dominated by Google, Facebook, and Amazon, there is still ample room for new players to enter the market. Lesser competition would provide Overture with an opportunity to concentrate on their core strengths, such as their PPC program, and gain a better foothold in the market.
Moreover, smaller businesses might prefer to work with a medium-size player like Overture, as they would be able to receive tailored service, better communication, and more personalized attention than provided by a larger company.
3) Changing consumer behavior
With privacy becoming an important issue, consumers are increasingly moving away from social media as an advertising platform. This presents an opportunity for contextual advertising players that use search data to target consumers. As per a survey by GlobalWebIndex, 43% of consumers in the US and UK are likely to use ad-blockers.
Furthermore, consumers are becoming selective about the ads they see and prefer ads that provide value or are informative. Contextual advertising, which targets consumers based on their search queries or content they are reading, is less intrusive and can provide more relevant ads that might be of interest to consumers.
As per a survey by WP Engine and Manifest, 58% of consumers reported that they prefer ads that display products or services they have already shown interest in. This presents an opportunity for contextual advertising players like Overture to showcase their expertise in displaying ads to consumers that are relevant to their interests.
In conclusion, contextual advertising has become a significant part of digital advertising today. Overture's expertise in the PPC program gives them a significant advantage to create a program that could target the growing e-commerce industry and provide a unique selling proposition to businesses looking for personalized services. Additionally, with lesser competition and changing consumer behavior, Overture can leverage the market opportunities to make a significant impact in the contextual advertising space.