How CPG brands can build an effective contextual advertising strategy

Consumer Packaged Goods also known as CPG brands are companies that manufacture and sell packaged products to consumers. These include everyday goods like personal care products, food and beverages, and household cleaning items. Popular CPG brands include Procter & Gamble, Johnson & Johnson, Unilever, Nestle, and Coca-Cola.

CPG is one of the hottest selling categories sold in supermarkets, retail outlets, and online, and appeals to a large audience base. A highly competitive space, brands in this space maximize their marketing efforts to grab more eyeballs and boost sales. Marketing is essential for CPG brands as it impacts key areas:

• In a crowded and competitive marketplace, marketing is much needed to increase brand awareness and build a loyal customer base.
• Ads are also a great way to highlight product USPs, differentiators, and unique features that set a brand apart from the rest. This helps in both customer retention and acquisition.
• Marketing strategies help boost customer engagement by enabling brands to collate customer feedback, respond to queries and concerns, and forge long-lasting relationships.
• Marketing campaigns aid sales efforts by driving traffic to the website or marketplaces, and encourage customers to browse products and make purchases.
• Campaigns also help brands build a strong brand image, garner more consumer attention, and increase brand recall.

Behavioural vs Contextual Advertising: What strategy works best for CPG brands?

For the longest time, CPG brands have relied on behavioral advertising practices to display ads to their target audience. However, programmatic ads have a different impact today than they cannot keep up with the changing consumer needs.

Today’s consumers do not want irrelevant ads hampering their browsing experience. They demand relevance, personalization, privacy, and a non-intrusive experience. The tightening of ropes around consumer data privacy and the implementation of global data privacy laws further add to the need for better audience targeting practices.

Programmatic ads focus on scale rather than intent. While the ad reach and impressions are high, the mass reach of ads does not translate to ROI as it only targets a large audience base and not necessarily the right audience. These ads normally follow users around based on their past interests, and the banners disrupt the overall browsing experience.

Retail media is another avenue where CPG brands can directly advertise on the retailer’s site. This is a great way for brands to utilize their first-party data repository and target customers with personalized ads. However, this strategy is not effective when it comes to customer acquisition campaigns. 

How an effective contextual advertising can boost metrics for CPG brands

Striking the right balance between behavioral ads and retail media, contextual targeting offers CPG brands an opportunity to deliver ads to the most relevant audience base at the right time and in the most relevant context. By rendering personalized ads in an environment where high-intent shoppers browse, contextual ads strike when the iron is hot. When ads align with the content and context of a webpage, they are more likely to capture attention as they lie within the users’ realm of interest.

For example, a user reading about a particular skincare routine is more likely to be interested in buying skincare products than a user reading a sports article. With content and context-based insights, brands can develop a better understanding of consumer interests and how they interact with their products.

Unlike behavioral targeting, which leverages third-party data and is based on past areas of user interests, contextual insights are derived from deep understanding of content and context. These insights help determine the most effective topics, keywords, and content that the desired target audience could find most engaging and relevant. Instead of basing advertising strategies on the past, contextual advertising ensures brands target consumers actively searching for and engaging with content relevant to the brand’s products.  

Our contextual insights also help brands zero in on the most relevant customer base making it a more cost-effective strategy than bidding on broader keywords that do not drive intent. For instance, during the 2023 Valentine’s Day, the top areas of interest were last minute gifting, Valentine’s Day experiences, and Valentine’s Day planning. 

Our Cookieless FMCG Contextual Insights report revealed that key contextual categories ranked by average article visits, revolve mainly around cooking and recipes. The high interest content categories were Food, Dairy, Healthy, and Kids & Babies. Among the key content clusters, 62% of articles that were consumed by users were on food. This includes a wide variety of products used for cooking or direct consumption. One in every three articles or 38% highlight health like healthy eating, dieting, recipes, etc. Another 18% of articles surround kids & babies which includes recipes and food recommendations best suited for children.

Among article visits to key FMCG consumer values, healthy topped the charts with 58% of total article visits. These were mainly health-related diets, recipes, and food & drink choices. The second largest value to consumers was the children & infants category found in 36% of all FMCG content. Money saving tips & tricks contributed the third largest value to consumers comprising 24% of all related-content.

Access to data from contextual insights reports like the one above on Cookieless FMCG, enables brands to develop a deeper understanding of users’ key interests, top keywords, and trends. Knowing more about what consumers are searching for and their topics of interest helps brands engage with consumers who are relevant and have high purchase intent. With our contextual insights, brands can enhance their targeting strategy and improve overall sales numbers. Contextual insights are here to provide top data found in FMCG articles, powered by our AI contextual technology, Liz, and run through our worldwide publisher network.

With an enhanced understanding of consumer interests and the capability to provide contextual creative that resonate with consumers, contextual ads have the perfect recipe for driving relevant impressions, providing better consumer engagement, and helping build a memorable and consistent brand identity. All this in an environment that guarantees brand safety and suitability without leveraging any third-party cookies. 

For Colgate Plax, we proved contextual advertising performs better and delivered on our promise.

44% uplift in brand favorability

14% increase in unaided brand awareness

12% uplift in consideration

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