Artificial Intelligence has made a mark in nearly every field and is transforming the way we work. Since AI assists businesses in positioning their products and services, gathering consumer data, and improving future offers, a big fundamental shift is taking place in today’s digital world. The majority of marketers use AI to anticipate churn, propose content, and execute marketing campaigns.
Artificial intelligence has the potential to transform digital marketing by improving production and demand. Let’s take a closer look at the numerous applications of artificial intelligence in marketing.
1) Personalization and Targeted Advertising
Example – Google
Artificial Intelligence, or AI for short, has given a new flavor to the advertising world. One of its coolest contributions? Making ads more personal and targeted. It’s all about putting the right stuff in front of the right eyes at the right time, and AI is here to help with that.
Here’s the deal – AI is like this big info collector, soaking up tons of data from places like websites, social media, and online stores. It’s trying to get a vibe of what a customer likes, doesn’t like, or totally obsesses over. All this info is then used to make tailor-made ads that line up with what people want. So, if someone’s always searching for running shoes, AI can catch that trend and show them ads for running shoes or maybe even stuff that goes along with that, like sportswear or health boosters.
Google has stepped up the ad game big time by using AI to make its ads more personal and on-point. Google’s AI uses all sorts of info like what users search, where they click, and their online history to make some pretty accurate guesses about what kind of ads will hit home with them.
For example, if someone’s looking up gym gear, Google’s AI might show them ads for home workout sets, gym memberships, or even fitness classes. The magic of this method is all about relevance. By giving users ads that vibe with their interests, Google makes them happier and more engaged. Plus, it’s a win for advertisers too, because they get more clicks on their ads. It’s a total win-win.
2) Programmatic Advertising
Example – Spotify
AI-powered advertising is totally revolutionizing the ad game. Imagine trading the old-school, laborious way of buying ads with quick, efficient, automatic systems. That’s programmatic advertising in a nutshell, where AI does all the work, sifting through huge chunks of data to spot who’s gonna dig your ads the most, then bids on ad spaces on-the-fly.
The beauty of it? It saves you time and money by taking out human mistakes, while still letting you tweak things on the go. Plus, it’s like having a crystal ball to see who’s more likely to click on your ad. The bottom line, you get to chat up your ideal customer without wasting your hard-earned dollars. Talk about hitting the jackpot!
Take Spotify, for example. They’re using AI to jazz up programmatic advertising, making it more personal and efficient. They dissect stuff like what tunes you’re into, your go-to playlists, and when you’re most active, to dish up ads that you’ll actually care about.
Say, you’re an advertiser peddling running shoes. Spotify’s AI would point you toward users who are all about that high-energy workout music. With a whopping 345 million active users, that’s a pretty diverse crowd to pick from. Thanks to AI, Spotify can dish out ads to each user that are as unique as their playlist, cranking up the success rate of ad campaigns like never before. So basically, you get more bang for your advertising buck!
3) Predictive Analytics
Example – Facebook
Predictive analytics is like the crystal ball of AI in advertising. It puts AI to work to guess what customers might do next based on what they’ve done in the past. This super cool use of AI helps ad folks make ads that hit the bullseye, every single time. Thanks to AI’s ability to crunch big data like a champ, it can figure out consumer vibes and fads before they even happen. This guessing game magic does wonders, not just for who sees the ads, but also when and where the ads pop up.
Facebook’s AI is like the Sherlock Holmes of predictive analytics for super-focused advertising. It scours through user data, stuff like page likes, shares, and all that jazz, to figure out what the user might do next. For instance, if someone’s been surfing a ton of recipe pages, the AI brain might figure they’re itching to buy some new kitchen gizmos and then BAM, shows them ads about that.
A fresh-off-the-press study showed that these targeted Facebook ads can pump up conversion rates to a whopping 9.21%, which totally smashes the industry average of about 2-3%. By guessing user behaviors and likes, Facebook’s AI gives businesses the scoop on how to reach potential customers in the best way possible, which means more bang for their advertising buck.”
4) Sentiment Analysis
Example – Twitter
Sentiment Analysis is one of the crucial aspects of Artificial Intelligence used in the field of advertising. Essentially, sentiment analysis allows businesses to understand the emotional tone behind words. This is incredibly important in social media monitoring as it helps brands understand their customers better and react to both positive and negative feedback more effectively.
Twitter uses AI-powered sentiment analysis to provide businesses insights into public opinion about their brand or products. This involves analyzing tweets and comments to determine whether the prevailing sentiment is positive, negative, or neutral.
For instance, after the launch of a new smartphone model, Twitter’s AI can examine related tweets to understand the public’s reaction. Brands can use these insights to adjust their marketing strategies, address concerns, or capitalize on positive feedback., Twitter reported over 330 million active users, indicating the immense potential of sentiment analysis for gaining consumer insights on this platform.
5) Chatbots and Virtual Assistants:
Example – Starbucks
Chatbots and virtual assistants have emerged as leading applications of AI in the advertising sector. Powered by AI, these tools have become significantly smarter and more interactive over the past few years. They are primarily used for improving customer interaction and engagement. Chatbots simulate human conversation, allowing businesses to provide 24/7 customer service. They answer queries, provide product recommendations, and even facilitate transactions, making the shopping experience more seamless.
Starbucks uses AI-powered chatbots for personalized advertising and customer service. The Starbucks Barista bot on Facebook Messenger, for example, engages customers in conversations, recommends drinks based on their preferences, and allows them to place orders.
Starbucks reported that the bot had handled over 2 million conversations, showcasing the power of conversational AI in advertising. By personalizing the ordering process, Starbucks not only increases customer satisfaction but also promotes its products in a natural, engaging way.
6) Visual Search:
Example – Pinterest
Visual Search is getting super important in the advertising world, thanks to fancy artificial intelligence tricks. Now, all you gotta do is snap a pic or upload an image, and bam! You can find and buy stuff without even using words. It’s like magic! Big players like Pinterest and Google are already in on this game, giving their users a totally interactive and exciting shopping experience.
Pinterest is all about boosting visual search with the help of AI. You can upload a pic, and the clever AI will find similar things or stuff related to it. So, if you snap a pic of a cool, modern chair, Pinterest’s AI will show you other chairs that look just as cool, and you can actually buy them!
Pinterest has a massive gang of over 450 million peeps who use the platform to get inspired and find cool stuff to buy. By seamlessly blending in product recommendations with the visual search experience, Pinterest creates a super cool opportunity for brands to advertise and reach out to these users.
7) Voice Search:
Voice search, powered by artificial intelligence, is rapidly reshaping the advertising landscape, offering a fresh and interactive way for brands to engage with consumers. As of 2023, the increasing adoption of smart speakers and voice assistants like Amazon’s Alexa, Google’s Assistant, and Apple’s Siri have made voice-activated searches a commonplace occurrence. These AI-driven technologies are capable of understanding and responding to spoken queries, providing immediate answers and recommendations. For advertisers, this means optimizing their content and ads to be discovered and effectively presented via voice search.
Amazon’s voice assistant, Alexa, uses AI to interpret user commands and suggest products available on Amazon. With the rise of smart homes, more users are turning to voice assistants for shopping.
Alexa responds to user queries by suggesting products, providing an opportunity for advertisers to reach customers in a new, engaging way.
It was estimated that there were over 200 million Alexa-enabled devices worldwide, illustrating the reach and potential of voice-based advertising.
8) Content Creation:
Example – The New York Times
AI-based content creation tools are also proficient at data analysis, which allows them to incorporate the most effective keywords and SEO strategies into the content. This enables businesses to improve their online visibility and reach a wider audience.
Furthermore, AI in content creation has made it possible to create personalized content. By analyzing user data, AI can understand individual preferences and behaviors, thus enabling it to craft messages that are specifically targeted at individual consumers. This level of personalization can significantly increase the effectiveness of advertising campaigns.
The New York Times uses AI to generate content for its advertising partners through a tool called “T Brand Studio”. This tool can create articles, infographics, and other types of content that match the advertising partner’s brand and The New York Times audience.
While specific data on the tool’s success isn’t publicly available, the continued investment into AI by The New York Times suggests that the approach is yielding positive results. By automating content creation, businesses can ensure consistent, high-quality advertising content while freeing up resources for other tasks.
9) Ad Performance Analysis:
Example – Adobe
Artificial intelligence (AI) is like a magical force that’s changing the game of analyzing ad performance. It gives marketers super cool tools to make super smart decisions based on data. AI is all about handling ginormous amounts of data, finding cool patterns, and telling you what’s gonna happen in the future. It’s like having a crystal ball for understanding how ads are doing.
AI-powered systems can keep an eye on the important stuff in real-time, like how many people are clicking on ads (click-through rates or CTR), how many are actually buying stuff (conversion rates), and how engaged people are with the ads. They dive deep into the ad campaign to show you what’s awesome and what’s not so awesome.
Adobe has this boss AI tool called Adobe Sensei. It’s like the ad performance guru across different platforms. It knows which ads are rocking it and why they’re totally killing it. And it even suggests ways to make not-so-great ads more awesome.
By automating the whole analysis thing, Adobe Sensei saves marketers tons of time. Plus, it finds insights that humans might miss because they’re not superhuman like AI. Adobe doesn’t give out the exact numbers, but Adobe Sensei is a big part of their Adobe Experience Cloud, which had crazy good revenue growth of over 21% year after year. It’s a big deal!
10) Dynamic Pricing:
Example – Uber
Dynamic pricing is a revolutionary application of artificial intelligence (AI) in the advertising industry. It involves the use of AI to analyze a multitude of variables such as demand, competition, and other market conditions to adjust prices dynamically. AI helps to make the pricing flexible and more responsive to changes in real time.
It has revolutionized the way advertisers approach pricing strategies. For instance, during peak seasons or high-demand periods, the prices of certain goods or services might be increased to maximize profits. Conversely, during low-demand periods, prices can be decreased to attract more customers. This strategic price modulation helps businesses to stay competitive and increase sales.
Uber uses AI to implement dynamic pricing in its ads. Depending on factors like demand, location, and time, Uber’s AI adjusts pricing and displays it in its ads. This strategy helps attract more riders during low-demand periods and manage rider demand during busy times.