Digital Advertising Today: How is AI Changing the Game?

Defined as “the simulation of human intelligence processes by computers,” Artificial intelligence (AI) has been increasingly utilized in the business and marketing landscape. Yes, the technology that brought us talking robots and self-driving cars is now transforming the advertising industry. AI has been quickly reshaping how businesses approach advertising in significant ways. E-commerce has surged higher than ever in recent years and businesses have been doing their best to stay ahead of consumer trends and outmaneuver their competitive rivals. As its technology continues to evolve, AI has become an advantageous tool for marketers and advertisers, as we can see from advertising platforms like Google. Now imagine that instead of targeting ads to random people in hopes that they are interested in your product, you have your own personal advertising genie that can analyze consumer behavior, preferences, and interests to create hyper-personalized ads that are sure to appeal to consumers. As consumerism and our lives have become more digitized, AI has assisted businesses in understanding and predicting consumer behavior from disparate data points so that they can produce advertising campaigns that are conducive to their campaign goals. In fact, Andrew Ng, the creator of Google and Baidu’s AI systems has presented AI and advertising as a major business opportunity in his AI for Everyone course. According to trueNorth, 61% of marketers say artificial intelligence is the most important aspect of their data strategy AI Statistics . As the growth of programmatic advertising and new technology overtakes the advertising industry, it is important to understand the virtue of embracing AI as the future of advertising and the competitive disadvantage businesses are at if they don’t hop on the bandwagon.

So, how exactly is AI affecting advertising platforms like Google, and how will it impact marketing in the future? Let’s take a look:

• AI presents opportunities for advertising campaigns to reach a more relevant audience with stronger and more optimized ad campaigns. AI has the ability to analyze data in order to understand users and their behaviors, preferences, and interests and then improve targeting and hyper-personalization accordingly. Advertising platforms, like Google, can use this information to curate more relevant and personalized ads to individual users and locate new customer opportunities in the sea of data. For instance, since 2021, Google has drastically changed their ads with the help of AI. Google’s AI-powered Smart Campaigns look at small businesses’ goals and audiences and then data, such as search terms, website activity, and location. AI can then automatically create and optimize the most appropriate ads, and Google’s ads have a higher chance of resonating with their intended audiences, leading to increased sales and brand awareness. While humans aren’t great at targeting consumers based on various demographic and behavioral data points, AI can do this and even test ad permutations to check what consumers are most responsive to. No vague guesses or gut feelings involved. Google, for instance, rotates headlines and descriptions to calculate the highest-performing combinations for their ads as well as uses machine learning to extrapolate the most fitting and relevant combinations for specific user search queries. Alternatively, AI can predict ad performance before campaigns are launched so businesses can preemptively revise them instead of wasting money. By looking at your past target audience and ad performance and comparing it to your KPIs and current ad performance, AI can suggest new and higher-value segments.

• Digital advertising platforms can use AI to eliminate tedious and costly tasks, so analysts can spend their time doing something more productive, like bing-watching their favorite TV shows. Google uses AI for autonomic biddings, smart campaigns, and automated ad extensions. Google’s smart replies function is a feature in Gmail that answers emails for employees; it currently accounts for 10% of total emails sent, and the percentage is expected to increase as the algorithm further develops (AI Frontline Workers). Chatbots are on many websites improving customer experience by accurately and promptly answering customer’s various questions. Instead of doing tedious

• AI’s efficiency has lowered the advertising costs and energy across channels and audiences, which can result in increased return on investment for businesses. For example, Google's automated bidding algorithms use machine learning to analyze data and then adjust bids to maximize ROI. As a result, businesses can derive the most value from their advertising budget and increase conversion rates and revenue. This is particularly helpful for smaller businesses that might not have a larger marketing budget but want to maximize their ROI.

• AI can analyze data to identify patterns and insights in real time that are not always apparent to humans. It can elucidate competitors’ advertising costs, ideas, and strategies. It can also help detect fraudulent activity, such as click fraud. Google’s AI-powered click fraud detection system analyzes data to expose suspicious clicks that bot activity is often responsible for, which prevents unnecessary ad costs associated with fraudulent clicks.

These applications are just a few examples of the many beneficial ways AI can be used for advising campaigns to aid businesses in attracting their target audience and driving sales. If you are running online advising and have not taken advantage of AI yet, what are you waiting for? Your competitors are already using it, and you don’t want to be the only one without the latest and greatest technology. It’s time to upgrade your marketing game and give the machine the wheel. Get with the times.