Until recently, the targeted ad was the only example of contextual technology experienced by most people. Invented in the mid-90s, it attempted to match adverts to people by analyzing their search terms and frequently visited websites. However, the algorithm fails to take into account the type of good or service the advert offers. As such, suggested offers are frequently, at best, irrelevant, or, at worst, faintly insulting (weight loss programmes anyone?). In short, the problem with targeted ads is that they lack context.
Enter the new generation of contextual technology.
This connects real-world data obtained through sensors and mapping services in the device, with digital data  gathered from social networking sites and the wider media . With this data combined, users can receive highly personalized, relevant services  that anticipate their needs and proactively deliver solutions. All this data is hosted on large cloud storage systems. This means information is easily accessible and sharable (thereby facilitating a far greater degree of connectivity than ever seen before), and eases the integration of real-time data and contextual information which can then be analyzed by cloud-based modelling applications . It paves the way for better management of promotions and offers in real-time, and means that both manufacturers and retailers  can measure return on invest (ROI) more accurately.
Let’s use an example. Instead of showing traditional targeted ads on a home computer, a mapping system on your phone can now alert you to the fact that you are near a restaurant which one of your Facebook friends has recently liked. A retailer can then send you a coupon for this restaurant and, with a high likelihood of it being used, has been able to minimize the challenge of delivering offers and promotions to individual customers at the ‘right time’. The restaurant gains a new customer, and you find a new place to eat at a discounted price. Instead of a boring and unmemorable pop up, the advert is suddenly relevant to your life.
Yet contextual technology goes far beyond improving targeted adverts. ‘Wearable computers’ have featured heavily in the news recently; items such as ski goggles, glasses, and watches learn the wearer’s preferences and monitor his or her surroundings, alerting the wearer to new opportunities. There is also a rapidly emerging branch of contextual technology that deals with health care; from watches that monitor a pulse, contact lenses that can detect glaucomas, or even ‘smart implants’ that logs the amount of stress being placed on joints .
Making sense of it all
All of this is possible because of sensors. Sensors garner data on location and environment from their surroundings, but can also monitor other sources of information such as big media and social networking sites in order to provide the sensor with a full understanding of every event. Individual sensors are connected to wireless sensor networks (WSNs), which contain data gathered by all the sensors in the area, protecting against the failure of any one sensor. While WSNs are currently small, local networks, they are beginning to integrate. This will eventually result in a global WSN that enables devices to connect with each other and trade data on an unprecedented scale . This phenomenon, of devices which can ‘know’ everything without human input, is known as ‘The Internet of Things’ (IoT)  and it is fast becoming a reality.
Accenture predict that easy access to information, combined with rapidly increasing use of smartphones, social media, and cloud storage, will result in a large-scale take up of contextual technology in the very near future. Meanwhile, the increased opportunities it offers for collaboration and communication means that 53% of organisations worldwide are planning on introducing IoT solutions such as sensors in the next two years. At the recent Consumer Electronics Show (CES) in Las Vegas, an IoT consortium was announced to support the growth of internet-enabled devices for consumers. Given this, it seems highly likely that contextual technology will rapidly become an important part of the technological sector. And as advertisers begin to move into the contextual age, the opportunities for reaching consumers in relevant and effective ways will be stronger than ever.