Beyond keywords: Ad eligibility and targeting strategies for top commerce media networks

Determining “right time, right place, right customer” is one of the most basic, yet essential principles in digital advertising. But if it’s so simple, why is it still so hard to get it right? 

Commerce media seemed like the answer to this problem: with troves of first-party data, finally, advertisers could be certain their ads were appearing in front of the right consumers: those likely-to-buy, those who bought similar products, those who had abandoned their cart but returned to the site, etc. And now, with innovative relevancy AI models, commerce media networks (CMNs) are serving even more personalized ad experiences to users while still driving efficient advertiser bidding and unique business goals. 

However, even with transformative audience targeting strategies and ML algorithms, many commerce sites still suffer from irrelevant ads, especially on search pages, and inefficient ad buying and internal operations. Too often, the culprit is keyword targeting, a popular but at times, suboptimal way of ad buying. In this article, we explain how top CMNs are re-thinking not just targeting offerings, but ad eligibility, in order to promote relevant, revenue-driving experiences for advertisers and CMNs alike. 

How we got here 

With the rise of eCommerce, many commerce sites evolved into search platforms—mirroring Google’s keyword-based targeting to support growing search behavior and ad revenue. Sponsored listings, now a dominant format in commerce media, could be easily tied to keyword inputs, giving advertisers the ability to bid on high-intent queries—even those related to competitors—to drive visibility and incremental sales.

But commerce sites are not Google. The inventory is transactional, and the user intent is far more specific. A shopper searching “soda” on a retail site likely wants to buy soda—immediately. In contrast, a Google search for “soda” could reflect curiosity, research, or regional linguistics. On commerce platforms, sponsored results are expected to reflect this purchase-ready mindset.

Poor alignment between search intent and ad output disrupts that expectation. If a shopper searches for bread and sees condiments instead—simply because another brand bid on the term—they may lose trust and abandon the site altogether. Relevance, like shelving in a physical store, matters.

So how can commerce media networks balance advertiser control with shopper-centric relevance? The answer lies in thoughtful eligibility settings and targeting strategies that align monetization goals with user experience.

Key considerations for determining ad eligibility

Every effective CMN requires a carefully engineered eligibility system that balances advertiser goals with user experience. While targeting parameters determine who can be reached, eligibility rules define where and under what conditions an ad can serve. Getting this right is essential to promoting relevance while driving unique business outcomes.

Eligibility frameworks in commerce media environments are typically built around three key components:

1. Advertiser-defined inputs

To appeal to advertisers, CMNs have to provide opportunities for advertisers to achieve their own unique goals and given their own context and needs. This requires (especially for sophisticated, enterprise advertisers) offering advertiser inputs that determine eligibility. These inputs might include targeting preferences based on user behavior (e.g., lapsed purchasers), specific product SKUs they want to promote, or campaign-level constraints like dayparting or geo-targeting. To maintain relevance, advertisers often set inclusion or exclusion criteria, such as only showing ads to repeat buyers or boosting bids for high-intent users. These controls allow advertisers to express their intent, but only within boundaries that the platform defines.

2. Auction-time logic and relevance scoring

Once a user lands on a page that can serve ads, the platform initiates an auction to determine which ad, if any, is eligible to appear. During this process, each eligible ad is evaluated using a combination of bid value and a dynamic relevance score. This score reflects how well the ad aligns with the user’s context, including search terms, page content, past behaviors, and predicted likelihood of engagement or conversion.

Ad rank is generally calculated using a combination of the bid and the relevance score. High-bidding ads won’t always win if they aren’t relevant, especially in environments where the CMN is prioritizing shopper experience and long-term retention over short-term revenue.

3. Platform-level rules and governance

To ensure fairness, efficiency, and a positive user experience, CMNs often impose platform-wide constraints. These can include:

• Bid ceilings or boost limits to prevent overexposure of irrelevant ads.
• Inventory-based eligibility rules, where specific formats (e.g., sponsored listings) only accept certain types of bids or targeting logic.
• Relevance gating, where ads must meet a minimum score or category match to even qualify for an auction.

Some platforms also enforce product-to-page matching, so that ads only appear on pages aligned with the product’s actual category or utility, for example, showing sunscreen on a “beach essentials” page, but not on a search for “foundation makeup.”

Key considerations for determining targeting offerings

As mentioned, a CMN’s set of targeting offerings essentially defines which controls they are willing to give to the advertiser to allow them to promote their business goals. This is why getting ad eligibility right is so essential: without the right controls at the CMN level, the advertiser has too much power to potentially harm the consumer experience. 

Once relevancy is correctly determined to ensure the right listings appear on the right searches, both at the organic level and ad level, CMNs have the ability to unlock the following targeting offerings for advertisers:

1. First-party data targeting (audience targeting): The key differentiator of commerce media is its first-party data. This uses first-party data, lookalike audiences, and behavioral insights to refine ad targeting. There are almost unlimited first-party data parameters to target by, including demographics, browsing history, purchase behavior, or engagement levels. 
2. Entity-based targeting: This option allows advertisers to target a specific entity/product or any characteristic of that entity/product that advertisers want to promote. Advertisers bid on placements for individual products, ensuring they appear in relevant search results, category pages, or recommendation widgets. 
3. Ad inventory-based targeting: This optimizes ad placements based on available advertising inventory within a CMN. Advertisers bid dynamically, ensuring their ads are placed in the most valuable and high-visibility ad slots based on demand and competition. For example, an advertiser could multiply their bid to secure a premium slot on a high-traffic shopping site.
4. Contextual targeting: This places ads within relevant content environments without relying on user-specific data. It is defined by page content, categories, and context to match ads with the most relevant placements.
5. Keyword targeting: This triggers ads by specific keywords that users search for or appear in page content. Advertisers bid on relevant keywords, ensuring their ads are displayed when those terms are searched or mentioned in content. 

After reviewing different options, CMNs will need to determine which targeting parameters they want to offer by asking the following questions within their teams:

1. How much control do we want advertisers to have? CMNs must dictate under which conditions they want to give advertisers the ability to influence site relevance or user experience. With a newer advertiser, such as a mom-and-pop restaurant on a food delivery app, it might just make sense to offer ad inventory targeting, allowing them to boost their listing on high-traffic pages. But for sophisticated advertisers, including your top 50 brands, you might want to offer more exclusive and exciting parameters, including unique first-party data parameters. 
2. What inventory are we offering? Ideally, CMNs are aligning targeting offerings with specific inventory. For example, keyword targeting might make a lot of sense for for a display ad on a search result page (ie. a display ad for peanut butter DOES make sense on a search for bread). But, entity-based targeting might make more sense for sponsored listings. CMNs should strategically align targeting offerings with inventory to preserve relevancy while promoting advertiser outcomes and visibility. 
3. What level of automation do we want in the ad buying experience? Some advertisers will want to simply log in, put in their credit card information, and have their listings boosted so that they hit certain ROAS goals–they expect the CMN to do all the heavy lifting. Others will want granular control, and are willing to put in the effort to make it happen. Know your advertisers and their preferences in order to align your offering with their needs. 

A new path for keyword targeting

There’s not avoiding the fact that advertisers still think in terms of products, audiences, and intent. CMNs will still often need to support this reality. However, instead of relying solely on manual keyword-based strategies, enhance keyword targeting with AI-driven automation, first-party data, and contextual intelligence. If you want to incorporate keyword targeting for sponsored listings, the following recommendations help maintain a positive user experience while aligning with advertiser goals: 

1. Allow advertisers to bid on a “sub-commodities.” Instead of bidding on keywords, allow advertisers to bid on sub-commodities, an identified subgroup in your product/entity hierarchy, connecting each product to groups that advertisers can bid on.
2. Manage restrictions on products. Define for products what keywords they can be eligible for, and which ones are restricted. For example, only bread products can appear on bread 
3. Build your own broad match algorithm. Configuring your system for exact matches is extremely difficult and time-consuming. Instead, build an algorithm that accounts for keywords as well as misspellings and potential user errors. 

Though, keep in mind that these steps require rigorous maintenance and platform sophistication. These algorithms and restrictions must be reviewed continuously, which can be difficult to do efficiently. 

Why eligibility becomes critical in programmatic expansion

As commerce media networks extend their inventory into programmatic channels—both on-site and in-store—the need for sophisticated, scalable eligibility rules becomes exponentially more important. What once operated in a relatively closed-loop environment (e.g., native placements within a retailer’s owned-and-operated site) is now being opened to a wider range of demand partners, creative formats, and bidding behaviors.

With the right infrastructure in place, commerce media networks can confidently extend their inventory into programmatic channels while preserving the precision and shopper-centric standards they’ve built internally. Here’s how a strong eligibility system unlocks upside in programmatic expansion via SSP and DSP integrations:

1. Expand demand without losing control

CMNs need an SSP purpose-built for integrating inventory to a broader ecosystem of buyers while still enforcing granular eligibility rules. Ads are only shown when they meet the same criteria that govern on-site experiences, whether that’s product-to-page alignment, shopper segment targeting, or brand category restrictions. 

2. Preserve relevance across environments

By maintaining consistent eligibility logic across both native and programmatic channels, CMNs can deliver a unified shopper experience. Whether an ad is served on a mobile product page or a connected in-store screen, it reflects the same logic. This consistency builds trust with users and ensures advertisers see performance that aligns with their intent.

3. Unlock dynamic monetization strategies

Eligibility controls can power more advanced programmatic strategies, such as differentiated pricing for high-intent placements, real-time inventory-based rules, or bundling of in-store and online impressions. With strongly defined eligibility maintained through programmatic channels, CMNs can safely introduce more automation and flexibility without sacrificing control.

4. Empower advertiser sophistication

Advertisers increasingly want control, visibility, and performance. CMNs can offer more advanced programmatic features—like audience extension, dynamic creative optimization, or real-time bid boosts—while ensuring that all activity stays within bounds. Brands can experiment, optimize, and scale, knowing the rules of the commerce media environment are still enforced.

Optimize eligibility and targeting with a team of experts

At Koddi, we work closely with leading commerce media networks to architect scalable, relevance-first monetization strategies. Our platform enables CMNs to define and manage sophisticated ad eligibility rules, power targeting strategies with real-time data and AI insights, align monetization goals with user experience standards, and continuously refine performance with expert support and platform intelligence.

In today’s competitive landscape, CMNs can’t afford to trade relevance for revenue. But with the right eligibility framework and precision targeting tools, they don’t have to. Advertisers can still achieve visibility and incremental lift—without compromising the shopper experience.

By rethinking keyword targeting as part of a larger eligibility and targeting strategy, commerce media networks can unlock smarter monetization paths that serve both users and advertisers.