Artificial Intelligence has transformed most of the industries from finance to healthcare, digital advertising is no different. The presence of AI technology can be witnessed at every step, right from the creation of ads to target potential customers at the right moment. AI has something to offer for all key players, be it the advertiser, publisher or consumers. Adapting AI technology enables the brands to gain a competitive advantage in the marketplace. Let’s understand what AI is and how it has revolutionized the world of digital advertising.
Artificial Intelligence is a technology that enables machines to learn over time, with or without human intervention. Machines powered by AI are intelligent, smart and capable of performing tasks just like humans. They can read text; interpret the meaning, sense sound, and environment. But it’s their lightning processing speed that separates these machines from humans. They are capable of processing huge chunks of user data and drive conclusions from them.
What makes AI a “Natural Fit” for the advertising industry?
AI possesses certain key characteristics which makes it highly suited for the advertising industry. Brands are shifting towards making AI systems an integral part of their advertising strategy. AI is literally taking over the advertising industry.
- Ability to process large chunks of data: The evolution of the advertising industry has resulted in the availability of massive chunks and tons of user data. It’s literally impossible for humans to process this data, which is where AI-powered software proves to be extremely beneficial.
- Analyze patterns and makes a recommendation: Once the raw data is processed, these smart AI-assisted machines began to identify patterns and similarities among user data. Based on these patterns and trend analyses, these machines are capable of predicting changes to campaign settings which could bring better results and improved performance.
- Ability to learn: These machines are called Intelligent because of their capability to learning and get smarter with experience. Over time as this software handles more data, their accuracy to recommend changes improves.
Applications of AI in advertising:
· In-depth audience analysis and targeting the right users:
The advent of full-fledged and highly advanced Ad Platforms has resulted in the availability of massive user data. AI processes this large chunk of data and provides brands with a better understanding of their target audience. It creates audience segments for each product which brands can target in various ways. AI being “smart” improve over time by evolving the audience segments based on how a particular segment reacts to the advertising campaign. They are able to predict which leads are more likely to turn into customers.
· Manages the Ad spend and campaign settings:
AI systems, especially the one using the Machine language algorithm tracks the performance of the campaign and identifies the key pointers & demographics which are getting bulk of conversion. Based on this, it recommends changes to campaign parameters and shifts the ad spend to grab the attention of similar audiences that are converting. Prior to AI, gaining insight into trends and audiences was a manual activity that wasn’t very accurate. AI-enabled software have made the life of advertisers quite easy as they are far more bang on when it comes to making predictions and recommending changes. Bids are adjusted instantly based on campaign performance which improves the result.
· Create high-performance ads:
AI-powered software can create ads with or without human intervention which aims to achieve the goals of the advertisers. Most of the social media Ad platforms possess this feature where they can recommend ads that are most likely to draw higher user traffic based on the product being promoted. Third-party tools like Phrasee create ads for social media platforms like Facebook and Instagram which resonates with the requirements of the advertisers. These ad creation tools are intelligent and learn with the performance of each ad they create.
· Product recommendation using facial recognition:
There is certain image recognition software powered by AI which identifies users by their picture and recommends products based on user’s online behavior and interest. Taking it a step further, some software displays ads to the users based on the image on the webpage being read by the user. These ads are highly targeted and correlated. Facebook also uses similar software that recognizes users in the picture and recommends a tag that is mostly accurate.
· Saves Time and increases revenue:
High processing speed is one of the biggest pluses when it comes to adopting AI-enabled software for advertising. With AI, brands can now think of doing tasks that are unimaginable with manual effort. Turning the readily available raw user data into something informative is now possible only due to AI-enabled machines and software. Taking advantage of its accurate prediction and précised recommendations brands can target the right customers at the right time with the right product which certainly brings more conversions and improves return on investment.
How does Artificial Intelligence helps in Businesses?
- Identify Patterns & Trend analysis: AI enabled tools and applications have the ability to collect and process huge chunks of data. These machines work on historical data to find insights and patterns which are similar. It is not possible for data experts to process such huge volume of past data and this is where AI tools prove to be highly beneficial. This feature is already being implemented and used in health care and transportation industries. CT scans and MRI reports are examined by the software to identify similar patterns which helps in diagnosis of diseases.
- Accurate Product Recommendations: Companies across various industries are implementing AI tools with machine learning features as they are capable of understanding behaviour of customers and recommends them products which they are more likely to purchase. These tools analyse various user profiles which helps them to understand user’s likes and interest. This knowledge enables in accurate prediction which often ends up being successful. Netflix, one of the largest media service providers has gained immensely by implementing video recommending applications. Depending on the past videos viewed by the users, Netflix recommends its viewers TV series, shows and movies which match their interest.
- Demand Forecasting: Industries like manufacturing, sales and marketing works as per the demand of the customers. So, it gets extremely essential for the executives to understand the market well. If their forecasting goes wrong, it has adverse impact on the revenue of the company. With the use of intelligent tools and companies serving them with their historical data helps in better forecasting. Apart from recommending products, there are tools which also send regular follow up emails to the customers and offer them customized discounts. There are smart tools used in the market which can predict the area with more demand of cabs and instruct the cab driver to reach that area.
- Inventory Planning: Manual tracking of inventory in a store is a tedious task which often requires 5-7 days by employees to complete with high chances of miscalculations. Using AI tools and Drones have been efficient in doing this task in less than 24 hrs that too with more accuracy than humans. Walmart use Drones which fly around the store, examine each shelf and note the items which needs refilling. These tools work best along with demand forecasting tools as they ensure that the raw material required to manufacture the most demanded product should never be out of supply.
- 24*7 customer assistance: Customer satisfaction plays a key role in growth of business. More satisfied customer’s means more revenue. Keeping this in mind, more companies are opting for automated customer interaction software which can converse with clients just like helpdesk executive. Chatbots have already been implemented across various customer facing companies. These bots are virtual assistance software which can solve client queries by answering their questions. They are available 24*7 which also saves budget for the company not having to hire executives to work day and night. As these tools have deep knowledge about regular customers, they also send them personalized message with brand specific content which certainly creates a stronger bond between the customer and the brand.
- Automate repetitive tasks and saves time: More than 70% of the daily tasks performed by a sales or marketing executive is repetitive. AI aims to automate these mundane tasks thereby saving time which can be utilized for better planning and performing other high productive tasks. Sales executives can devote more time in closing out the deals which they earlier had to spend in identify and