Semantic advertising applies semantic technologies to online advertising solutions. The function of semantic advertising technology is to semantically analyze every web page in order to properly understand and classify the meaning of a web page and accordingly ensure that the web page contains the most appropriate advertising. Semantic advertising increases the chance that the viewer will click-thru because only advertising relevant to what they are viewing, and therefore their interests, should be displayed.
Advertising on the Internet has the potential to be finely narrowcast, i.e., specifically adjusted to the interests of the individual viewer. However, mainstream techniques for identifying these interests—contextual advertising and behavioral targeting—are problematic.
Semantic analysis of a web page provides an understating of its overall meaning in the semantic approach. By comparison, contextual advertising technology bases web page advertising on a keyword scan of the text of a website or Internet search. An automated function loads advertisements onto the web page based on the text. However, keywords can have various meanings. For example, a web page containing the word “jaguar” may generate ads about zoos and cars. The very different nature of these contextual results means that someone’s advertising budget is not being spent wisely.
Behavioral targeting uses information collected on an individual's web-browsing behavior, such as the pages they have visited or the searches they have made, to select which advertisements to display to that individual. However, many platforms identify visitors by assigning a unique HTTP cookie that tracks the web pages they visit. Cookies are the subject of controversy due to privacy issues. In fact, the United States and European governments have taken action towards restricting their use.
Recent studies by Comscore suggest that 72% of ads are a poor fit with the content to which they are placed resulting a good deal of waste in the digital ad ecosystem without the advent of techniques like semantic advertising. This waste is sometimes called Brand Safety. Brand safety has the goal of making sure the ideas and concepts contained on a web page do not run into conflict with the brand objectives of the advertisers. Brand safety safety is just one goal of semantic advertising. Other goals are ad optimization, segmentation and media placement research.