Contextual Ads Good or Bad?

As you know from reading this site I am a member of Kontera. Kontera is a contextual based ad system in which keywords in your content are found and magically turned into advertisements. I am a huge believer in this style of advertising because it is not bulky and you don’t have random ads distributed throughout your content. By this I mean that the ads are relevant and generally unobtrusive unlike a big google ad block. However as I speak with more and more bloggers/readers I find that people have a general dislike for contextual ads because they feel it junks up your content even more so that I simple google ad block.

So with my blog in a still relatively small and new state I want your opinion because I am going to be looking into changing my advertising schema in order to generate a higher level of income. Are contextual ads good or bad? What are the pros and cons. Why do you like them and why do you hate them. Like I said I personally like them because I feel it allows for the greatest number of ads to be displayed on my site without interrupting to much of the readers progress. Generally speaking you would think the more ads you had the higher your income would be, but I am not experiencing this. My payouts are higher from Google Adsense each month with simply a small ad block in the sidebar than they are from Kontera.

With that I put my potential in your hands, would you prefer I kept the contextual ads, or would you prefer a Google ad block at the beginning of each post? I will take your comments in to deep consideration as I am planning on testing several different ad layouts within the coming months.

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